Bank of Finland Research Discussion Papers
272017
Gur Huberman – Jacob D. Leshno – Ciamac Moallemi
Monopoly without a monopolist:
An economic analysis of the bitcoin
payment system
Bank of Finland
Research
Bank of Finland Research Discussion Papers
Editor-in-Chief Esa Jokivuolle
Bank of Finland Research Discussion Paper 27/2017
5 September 2017
Gur Huberman – Jacob D. Leshno – Ciamac Moallemi:
Monopoly without a monopolist: An economic analysis of the bitcoin payment system
ISBN 978-952-323-186-3, online
ISSN 1456-6184, online
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The opinions expressed in this paper are those of the authors and do not necessarily reflect the views
of the Bank of Finland.
MonopolywithoutaMonopolist:AnEconomic
AnalysisoftheBitcoinPaymentSystem
GurHubermanJacobD.LeshnoCiamacMoallemi
ColumbiaBusinessSchool
August30,2017
Abstract
OwnedbynobodyandcontrolledbyanalmostimmutableprotocoltheBitcoin
paymentsystemisaplatformwithtwomainconstituencies:usersandprotseeking
minerswhomaintainthesystem’sinfrastructure.Thepaperseekstounderstand
theeconomicsofthesystem:Howdoesthesystemraiserevenuetopayforitsinfras-
tructureHowareusagefeesdeterminedHowmuchinfrastructureisdeployed
Whataretheimplicationsofchangingparametersintheprotocol
Asimpliedeconomicmodelthatcapturesthesystem’spropertiesanswersthese
questions.Transactionfeesandinfrastructurelevelaredeterminedinanequilib-
riumofacongestionqueueinggamederivedfromthesystem’slimitedthroughput.
Thesystemeliminatesdead-weightlossfrommonopoly,butintroducesotherin-
ecienciesandrequirescongestiontoraiserevenueandfundinfrastructure.We
explorethefuturepotentialofsuchsystemsandprovidedesignsuggestions.
helpfulconversationsandtoseminarparticipantsattheCentralBankofFinland,Columbia,EIEF,
MSR-NYC,NYCEandStanfordforhelpfulcomments.Keywords: Bitcoin, blockchain, queueing, two-sided markets, market design, cryptocurrency
JEL Classification: D40, D20, L10, L50
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1Introduction
Acrypto-currencyisadigitalcurrencystoredonanopenanddecentralizedelectronic
paymentsystem.FollowingNakamoto(2008),crypto-currencieshavecaughttheatten-
tionofindustry,academiaandthepublicatlarge,withBitcoinbeingthemostprominent.
Therearehundredsofsuchcrypto-currencies,manyrunningonlargeandreliabledecen-
tralizednetworksofanonymouscomputers.Thiswavehasbeenenabledbyaninnovative
computersciencedesignnamedblockchain”.Theblockchainsupportsthecreationofa
decentralizedelectronicpaymentsystemthatcanbetrusted,althoughnoneofthesys-
tem’sserversisindividuallytrusted.Thenovelblockchaindesignreliesonacombination
ofcryptographyandgametheory-basedincentives.Ithasreceivedmuchpublicinterest
onitsownright.
TheblockchaindesignenablesBitcoinandothercrypto-currenciestofunctionsimilarly
toconventionalpaymentsystemssuchasFedWire,Swift,Visa,andPayPal.These
paymentsystemsarenaturalmonopoliesinthattheyenjoyeconomiesofscaleandnetwork
eects.Eachofthemisoperatedbyanorganizationthatdeterminesitsrulesandmodies
themascircumstanceschange.Theserulesincludehowandhowmuchparticipantspay
forusingthesystem.Thegoverningorganizationensuresthesystemistrustedandis
responsibleformaintainingtherequiredinfrastructureforthesystem.Paymentsystems
areoftenregulated(oroutrightownedbygovernmentagencies)inordertomitigatethe
welfarelossassociatedwiththeirmonopolisticpositions.
TheinnovationinBitcoin’sblockchaindesignisintheabsenceofagoverningor-
ganization.Rather,aprotocolsetsthesystem’srules,bywhichallconstituentsabide.
Absentisacentralentitythatmaintainstheinfrastructure.Rather,Bitcoin’sinfrastruc-
tureconsistsofcomputerservers(calledminers”)whichenterandexitthesystematwill,
respondingtoperceivedprotopportunities.1Participantsfollowtheprotocolbecause
itisintheirbestinteresttodoso,assumingtheotherparticipantsfollowtheprotocol.
Thus,theprotocol-derivedrulesarepracticallyxedandbindingonallparties.
Theblockchaindesigncarriesaneconomicinnovation.Unlikeotherpaymentsystems,
Bitcoinisatwo-sidedplatformwithrulesthatarepre-speciedbyacomputerproto-
col.Noparticipanthaspowertosetormodifyfeesorrulesofconductorotherwise
controlthesystem.Eachparticipantinthemarketplace,usersandminersalike,isa
pricetaker.Usersareprovidedprotectionfrommonopolypricing:evenifthesystem
becomesamonopoly,thereisnomonopolistwhochargesmonopolistfees.However,for
1MiningispermissionlessinBitcoin,i.e.,anycomputercanserveasaminer.thesystemtofunctionproperlyitmustraisesucientrevenuefromtheuserstofundthe
requiredinfrastructure.Weaimtounderstandhowfees,systemrevenueandamountof
infrastructurearedeterminedinequilibrium,andhowtheseareaectedbytherulesset
bytheBitcoinprotocol.
Inordertoanalyzethesystem,werstconstructasimpliedmodelthatcapturesthe
economicenvironmentgeneratedbytheBitcoinprotocol.Weprovideasimpledescription
oftheblockchainprotocolandtheBitcoinsysteminSection3,illustratinghowtheBitcoin
systemisenabledbyacombinationofcryptographictoolsthatenablevericationofthe
ledger,togetherwithgametheoreticstructurethatsetsincentivestoreachconsensuson
alegalledger.Abstractingawayfrommuchofthetechnicaldetail,wetranslatethis
descriptiontoasimpliedeconomicmodel.
TheBitcoinsystem’stwomainconstituenciesareusers,identiedwiththetransactions
theysend,andservers,calledminers.Theminerscollectivelymaintainaledgerofall
transactioninaformatcalledtheblockchain,wheretransactionsarearrangedinblocks.
Eachtransactionisacryptographicallyveriedmessage.Every10minutes(onaverage)
theBitcoinsystemrandomlyselectsoneminertoaddablockoftransactionstothe
ledger,processingallthetransactionswithinthatblock.Theselectedminerissaidto
haveminedtheblock”.Equilibriumbetweenmanysmallminersensuresthatallminers
maintainconsensusonthesameledger,andonlylegaltransactionsareprocessed.The
protocollimitseachblocktonomorethanapproximately2,000transactions.2Therefore
thesystem’sthroughputisbounded,anddoesnotdependonthenumberofminers.
Toprovideproperincentives,thesystemcompensatesminersfortheireortbyre-
wardingminerswhentheyareselectedtomineablock.Therewardconsistsofnewly
mintedcoinsandthetransactionfeespaidbythetransactionsprocessedintheblock.
Theprotocolspecieshowmanynewlymintedcoinsareawardedineachblock.This
numberiscutinhalfapproximatelyeveryfouryears.Incontrast,transactionfeesare
notxedbytheprotocol,anduserschoosethetransactionfeestheypay.
Thesimpliedeconomicmodelcapturesthesefeaturesofthesystem.
Twosetsofseeminglydisparatequestionsarethestartingpointoftheanalysis:(i)in
thelongrun,whowillpaytheminersandwhy(ii)ifthesystembecomespopularhow
willitmanageitslimitedthroughputHpwwillserviceprioritybeassginedTheabsence
ofaBitcoin-controllingorganizationrendersbothquestionsnontrivial.Themodelasserts
asingleanswertobothquestions:Thesystem’scongestionduetoitslimitedthroughput
2Theprotocollimitseachblockto1MBofdata,andtheaveragetransactionrequires0.5KBofdata
(Zohar2015).。。。以上简介无排版格式，详细内容请下载查看