Transaction Capacity, Security and Latency in Blockchains

Abstract: We analyze how secure a block is after the block becomes k-deep, i.e., security-latency, for Nakamoto consensus under an exponential network delay model. We give parameter regimes for which transactions are safe when sufficiently deep in the chain. We compare our results for Nakamoto consensus under bounded network delay models and obtain analogous bounds for safety violation threshold. Next, modeling the blockchain system as a batch service queue with exponential network delay, we connect the security-latency analysis to sustainable transaction rate of the queue system. As our model assumes exponential network delay, batch service queue models give a meaningful trade-off between transaction capacity, security and latency. As adversary can attack the queue service to hamper the service process, we consider two different attacks for adversary. In an extreme scenario, we modify the selfish-mining attack for this purpose and consider its effect on the sustainable transaction rate of the queue.