Selfish Mining under General Stochastic Rewards
Maryam Bahrani, Michael Neuder, S. Matthew Weinberg

TL;DR
This paper develops a new model for selfish mining that accounts for stochastic, time-based rewards like transaction fees, providing both theoretical insights and practical implications for protocol security.
Contribution
It introduces a novel analytical framework for modeling and calculating selfish mining profitability under general stochastic reward functions, including transaction fees.
Findings
Profitability threshold reduced by 22% with combined rewards
Miner behavior varies with reward composition, affecting attack incentives
New methodology validated against existing models and simulations
Abstract
Selfish miners selectively withhold blocks to earn disproportionately high revenue. The vast majority of the selfish mining literature focuses exclusively on block rewards. Carlsten et al. [2016] is a notable exception, observing that similar strategic behavior is profitable in a zero-block-reward regime (the endgame for Bitcoin's quadrennial halving schedule) if miners are compensated with transaction fees alone. Neither model fully captures miner incentives today. The block reward remains 3.125 BTC, yet some blocks yield significantly higher revenue. For example, congestion during the launch of the Babylon protocol in August 2024 caused transaction fees to spike to 9.52 BTC. Our results are both practical and theoretical. Of practical interest, we study selfish mining profitability under a combined reward function that more accurately models miner incentives. This analysis enables us…
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