APoW: Auditable Proof-of-Work Against Block Withholding Attacks

TL;DR

APoW introduces an auditable proof-of-work scheme that enables miners to verify each other's effort, reducing block withholding attacks and supporting decentralized, verifiable mining pools without requiring trusted hardware.

Contribution

The paper presents a novel PoW construction that allows probabilistic auditing of miners' efforts, enhancing security and transparency in pool-based mining without trusted hardware.

Findings

Enables retroactive effort verification among miners.

Reduces incentives for block withholding attacks.

Supports decentralized, verifiable mining pools.

Abstract

We introduce Auditable Proof-of-Work (APoW), a novel proof-of-work (PoW) construction inspired by Hashcash-style nonce searching, which enables the auditing of other miners' work through accountable re-scanning of the nonce space. The proposed scheme allows a miner to probabilistically attest to having searched specified regions of the nonce space in earlier mining rounds, while concurrently earning rewards for performing productive work for a new block or pool share. This capability enables miners belonging to a mining pools to audit another miner's claimed effort retroactively, thereby allowing the probabilistic detection of block withholding attacks (BWAs) without requiring trusted hardware or trusted third parties. As a consequence, the construction supports the design of decentralized mining pools in which work attribution is verifiable and withholding incentives are substantially reduced. The scheme preserves the fundamental properties of conventional PoW, including public verifiability and difficulty adjustment, while adding an orthogonal auditability layer tailored to pool-based mining. Finally, while a full deployment of APoW in Bitcoin would require a consensus rule change and minor modifications to mining ASICs, the construction remains practically useful even without consensus changes, for instance, as a pool-level auditing mechanism that enables verifiable pay-for-auditing using existing pool reserves.