Scaling Blockchains: Can Committee-Based Consensus Help?
Management Science, Forthcoming
56 Pages Posted: 1 Sep 2021 Last revised: 18 Aug 2023
Date Written: August 14, 2023
In the high-stakes race for scalability, some blockchains have turned to committee-based consensus (CBC), whereby the chain's record-keeping rights are entrusted to a committee of block producers, elected via approval voting. Smaller committees boost speed and scalability but can compromise security when voters have limited information. In this environment, voting strategies are naturally non-linear and equilibria can become intractable. Despite this, we show that elections converge to optimality asymptotically (in voter numbers), exponentially quickly, and under relatively weak informational requirements. Compared to popular stake-weighted lottery and single-vote protocols used in practice, we find that CBC, when paired with approval voting, can offer meaningful efficiency and robustness gains, if enough voters are engaged.
Keywords: Approval Voting, Blockchain Consensus Protocols, Blockchain Economics, Token Voting, Committee-Based Consensus, Delegated Proof of Stake, DPoS, Stake-Weighted Voting
JEL Classification: G14, D82, C11, O32, O14
Suggested Citation: Suggested Citation