Download This PaperBitcoin and Beyond
Annual Review of Financial Economics, Volume 14, 2022, Pages 95 - 115
26 Pages Posted: 2 Nov 2021 Last revised: 21 Feb 2023
There are 2 versions of this paper
Bitcoin and Beyond
Date Written: November 1, 2021
Abstract
We survey extant literature on the economics of blockchain fundamentals with particular focus on Bitcoin, Proof-of-Work and Proof-of-Stake. We formally clarify Bitcoin’s economic significance in solving the double-spending problem without a centralized entity. We then transition to the economics literature, highlighting the key endogenous economic interactions among participants in the Bitcoin ecosystem as well as the economics of Proof-of-Stake and other potential consensus algorithms. Along the way, we discuss various literature that provides important insights regarding fees, forks and price volatility. We conclude by reflecting on the next generation of blockchain innovations.
Keywords: blockchain, bitcoin, fees, proof-of-work, proof-of-stake
JEL Classification: G00, O30
Suggested Citation: Suggested Citation
Maureen O'Hara
Cornell University - Samuel Curtis Johnson Graduate School of Management ( email )
Ithaca, NY 14853
United States
607-255-3645 (Phone)
607-255-5993 (Fax)
