Dissecting Mining Pools of Bitcoin Network: Measurement, Analysis and Modeling

Canhui Wang, Xiaowen Chu*, Yang Qin

*Corresponding author for this work

Research output: Contribution to journalJournal articlepeer-review

3 Citations (Scopus)


Bitcoin network is one of the most popular blockchain systems. Mining pools are the main components of the Bitcoin network that invest a large amount of computing power to maximize their expected mining payoffs, which guarantees the security of the Bitcoin network. Although many existing works about mining pools are available, the long-term evolution of mining pools, and their effects on both the Bitcoin system and end-users, remain to be investigated. To fill this gap, we trace over 2.54 hundred thousand blocks from Feb 2016 to Nov 2020 and collect over 12 million unconfirmed transactions from Mar 2018 to Nov 2020. We then conduct a broad range of analyses, including the pool evolution, labeled transactions, and labeled blocks. We make the following observations from our measured data: 1) A few mining pools control most of the peer-to-peer network's computing power. 2) The long-term computing power of top mining pools grows exponentially while its continuous-time mining strategy decreases linearly. 3) The computing power of the Bitcoin network converges to the Nash equilibrium. We then propose game-based strategies for mining activity analysis, i.e., the best-response strategies for mining pools when the mining revenue increases or decreases sharply. Moreover, we study the transaction fee dilemma of mining pools and the transaction fee strategies for end-users. Our models and analysis can help to understand and improve the Bitcoin system quantitatively.

Original languageEnglish
Pages (from-to)398-412
Number of pages15
JournalIEEE Transactions on Network Science and Engineering
Issue number1
Publication statusPublished - 1 Jan 2023

Scopus Subject Areas

  • Control and Systems Engineering
  • Computer Science Applications
  • Computer Networks and Communications

User-Defined Keywords

  • Bitcoin network
  • incentive mechanism
  • mining pool
  • mining strategy
  • proof-of-work


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