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Documents authored by Kiayias, Aggelos

Document
DOI: 10.4230/LIPIcs.AFT.2025.21
Pool Formation in Oceanic Games: Shapley Value and Proportional Sharing

Authors: Aggelos Kiayias, Elias Koutsoupias, Evangelos Markakis, and Panagiotis Tsamopoulos

Published in: LIPIcs, Volume 354, 7th Conference on Advances in Financial Technologies (AFT 2025)

Abstract
We study a game-theoretic model for pool formation in Proof of Stake blockchain protocols. In such systems, stakeholders can form pools as a means of obtaining regular rewards from participation in ledger maintenance, with the power of each pool being dependent on its collective stake. The question we are interested in is the design of mechanisms, i.e., "reward sharing schemes," that suitably split rewards among pool members and achieve favorable properties in the resulting pool configuration. With this in mind, we initiate a non-cooperative game-theoretic analysis of the well known Shapley value scheme from cooperative game theory into the context of blockchains. In particular, we focus on the oceanic model of games, proposed by Milnor and Shapley (1978), which is suitable for populations where a small set of large players coexists with a big mass of rather small, negligible players. This provides an appropriate level of abstraction for pool formation processes that occur among the stakeholders of a blockchain. We provide comparisons between the Shapley mechanism and the more standard proportional scheme, in terms of attained decentralization, via a Price of Stability analysis and in terms of susceptibility to Sybil attacks, i.e., the strategic splitting of a players' stake with the intention of participating in multiple pools for increased profit. Interestingly, while the widely deployed proportional scheme appears to have certain advantages, the Shapley value scheme, which rewards higher the most pivotal players, emerges as a competitive alternative, by being able to bypass some of the downsides of proportional sharing in terms of Sybil attack susceptibility, while also not being far from optimal guarantees w.r.t. decentralization. Finally, we also complement our study with some variations of proportional sharing, where the profit is split in proportion to a superadditive or a subadditive function of the stake, showing that our results for the Shapley value scheme are maintained in comparison to these functions as well.
Cite as

Aggelos Kiayias, Elias Koutsoupias, Evangelos Markakis, and Panagiotis Tsamopoulos. Pool Formation in Oceanic Games: Shapley Value and Proportional Sharing. In 7th Conference on Advances in Financial Technologies (AFT 2025). Leibniz International Proceedings in Informatics (LIPIcs), Volume 354, pp. 21:1-21:24, Schloss Dagstuhl – Leibniz-Zentrum für Informatik (2025)

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@InProceedings{kiayias_et_al:LIPIcs.AFT.2025.21,
  author =	{Kiayias, Aggelos and Koutsoupias, Elias and Markakis, Evangelos and Tsamopoulos, Panagiotis},
  title =	{{Pool Formation in Oceanic Games: Shapley Value and Proportional Sharing}},
  booktitle =	{7th Conference on Advances in Financial Technologies (AFT 2025)},
  pages =	{21:1--21:24},
  series =	{Leibniz International Proceedings in Informatics (LIPIcs)},
  ISBN =	{978-3-95977-400-0},
  ISSN =	{1868-8969},
  year =	{2025},
  volume =	{354},
  editor =	{Avarikioti, Zeta and Christin, Nicolas},
  publisher =	{Schloss Dagstuhl -- Leibniz-Zentrum f{\"u}r Informatik},
  address =	{Dagstuhl, Germany},
  URL =		{https://drops.dagstuhl.de/entities/document/10.4230/LIPIcs.AFT.2025.21},
  URN =		{urn:nbn:de:0030-drops-247409},
  doi =		{10.4230/LIPIcs.AFT.2025.21},
  annote =	{Keywords: Shapley value, Nash equilibria, Price of Stability, Reward sharing schemes, Proof of Stake blockchains}
}
Document
DOI: 10.4230/LIPIcs.AFT.2025.22
Single-Token vs Two-Token Blockchain Tokenomics

Authors: Aggelos Kiayias, Philip Lazos, and Paolo Penna

Published in: LIPIcs, Volume 354, 7th Conference on Advances in Financial Technologies (AFT 2025)

Abstract
We study long-term equilibria that arise in the token monetary policy, or tokenomics, design of proof-of-stake (PoS) blockchain systems that engage utility maximizing users and validators. Validators are system maintainers who get rewarded with tokens for performing the work necessary for the system to function properly, while users compete and pay with such tokens for getting a desired portion of the system service. We study how the system service provision and suitable rewards schemes together can lead to equilibria with the following desirable characteristics (1) viability: the system keeps parties engaged, (2) decentralization and skin-in-the-game: multiple sufficiently invested validators are participating, (3) stability: the price path of the underlying token used to transact with the system does not change widely over time, and (4) feasibility: the mechanism is easy to implement as a smart contract, e.g., it does not require a fiat reserve on-chain to perform token buybacks or to perform bookkeeping of exponentially growing token holdings. Our analysis enables us to put forward a novel generic mechanism for blockchain monetary policy that we call quantitative rewarding (QR). We investigate how to implement QR in single-token and two-token proof of stake (PoS) blockchain systems. The latter are systems that utilize one token for the users to pay the transaction fees and a different token for the validators to participate in the PoS protocol and get rewarded. Our approach demonstrates a concrete advantage of the two-token setting in terms of the ability of the QR mechanism to be realized effectively and provide good equilibria. Our analysis also reveals an inherent limitation of the single token setting in terms of implementing an effective blockchain monetary policy - a distinction that is, to the best of our knowledge, highlighted for the first time.
Cite as

Aggelos Kiayias, Philip Lazos, and Paolo Penna. Single-Token vs Two-Token Blockchain Tokenomics. In 7th Conference on Advances in Financial Technologies (AFT 2025). Leibniz International Proceedings in Informatics (LIPIcs), Volume 354, pp. 22:1-22:22, Schloss Dagstuhl – Leibniz-Zentrum für Informatik (2025)

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@InProceedings{kiayias_et_al:LIPIcs.AFT.2025.22,
  author =	{Kiayias, Aggelos and Lazos, Philip and Penna, Paolo},
  title =	{{Single-Token vs Two-Token Blockchain Tokenomics}},
  booktitle =	{7th Conference on Advances in Financial Technologies (AFT 2025)},
  pages =	{22:1--22:22},
  series =	{Leibniz International Proceedings in Informatics (LIPIcs)},
  ISBN =	{978-3-95977-400-0},
  ISSN =	{1868-8969},
  year =	{2025},
  volume =	{354},
  editor =	{Avarikioti, Zeta and Christin, Nicolas},
  publisher =	{Schloss Dagstuhl -- Leibniz-Zentrum f{\"u}r Informatik},
  address =	{Dagstuhl, Germany},
  URL =		{https://drops.dagstuhl.de/entities/document/10.4230/LIPIcs.AFT.2025.22},
  URN =		{urn:nbn:de:0030-drops-247412},
  doi =		{10.4230/LIPIcs.AFT.2025.22},
  annote =	{Keywords: Blockchain, tokenomics, buyback, equilibria, price path, stable price, discounted game, dual-token, proof-of-stake, validator}
}
Document
DOI: 10.4230/LIPIcs.AFT.2024.9
Blockchain Space Tokenization

Authors: Aggelos Kiayias, Elias Koutsoupias, Philip Lazos, and Giorgos Panagiotakos

Published in: LIPIcs, Volume 316, 6th Conference on Advances in Financial Technologies (AFT 2024)

Abstract
Handling congestion in blockchain systems is a fundamental problem given that the security and decentralization objectives of such systems lead to designs that compromise on (horizontal) scalability (what sometimes is referred to as the "blockchain trilemma"). Motivated by this, we focus on the question whether it is possible to design a transaction inclusion policy for block producers that facilitates fee and delay predictability while being incentive compatible at the same time. Reconciling these three properties is seemingly paradoxical given that the dominant approach to transaction processing is based on first-price auctions (e.g., as in Bitcoin) or dynamic adjustment of the minimum admissible fee (e.g. as in Ethereum EIP-1559) something that breaks fee predictability. At the same time, in fixed fee mechanisms (e.g., as in Cardano), fees are trivially predictable but are subject to relatively inexpensive bribing or denial of service attacks where transactions may be delayed indefinitely by a well funded attacker, hence breaking delay predictability. In this work, we set out to address this problem by putting forward blockchain space tokenization (BST), namely a new capability of a blockchain system to tokenize its capacity for transactions and allocate it to interested users who are willing to pay ahead of time for the ability to post transactions regularly for a period of time. We analyze our system in the face of worst-case transaction-processing attacks by introducing a security game played between the mempool mechanism and an adversary. Leveraging this framework, we prove that BST offers predictable and asymptotically optimal delays, predictable fees, and is incentive compatible, thus answering the question posed in the affirmative.
Cite as

Aggelos Kiayias, Elias Koutsoupias, Philip Lazos, and Giorgos Panagiotakos. Blockchain Space Tokenization. In 6th Conference on Advances in Financial Technologies (AFT 2024). Leibniz International Proceedings in Informatics (LIPIcs), Volume 316, pp. 9:1-9:20, Schloss Dagstuhl – Leibniz-Zentrum für Informatik (2024)

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@InProceedings{kiayias_et_al:LIPIcs.AFT.2024.9,
  author =	{Kiayias, Aggelos and Koutsoupias, Elias and Lazos, Philip and Panagiotakos, Giorgos},
  title =	{{Blockchain Space Tokenization}},
  booktitle =	{6th Conference on Advances in Financial Technologies (AFT 2024)},
  pages =	{9:1--9:20},
  series =	{Leibniz International Proceedings in Informatics (LIPIcs)},
  ISBN =	{978-3-95977-345-4},
  ISSN =	{1868-8969},
  year =	{2024},
  volume =	{316},
  editor =	{B\"{o}hme, Rainer and Kiffer, Lucianna},
  publisher =	{Schloss Dagstuhl -- Leibniz-Zentrum f{\"u}r Informatik},
  address =	{Dagstuhl, Germany},
  URL =		{https://drops.dagstuhl.de/entities/document/10.4230/LIPIcs.AFT.2024.9},
  URN =		{urn:nbn:de:0030-drops-209453},
  doi =		{10.4230/LIPIcs.AFT.2024.9},
  annote =	{Keywords: Blockchain protocols, Predictable Service, Transaction Fees}
}
Document
Complete Volume
DOI: 10.4230/OASIcs.Tokenomics.2022
OASIcs, Volume 110, Tokenomics 2022, Complete Volume

Authors: Yackolley Amoussou-Guenou, Aggelos Kiayias, and Marianne Verdier

Published in: OASIcs, Volume 110, 4th International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2022)

Abstract
OASIcs, Volume 110, Tokenomics 2022, Complete Volume
Cite as

4th International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2022). Open Access Series in Informatics (OASIcs), Volume 110, pp. 1-82, Schloss Dagstuhl – Leibniz-Zentrum für Informatik (2023)

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@Proceedings{amoussouguenou_et_al:OASIcs.Tokenomics.2022,
  title =	{{OASIcs, Volume 110, Tokenomics 2022, Complete Volume}},
  booktitle =	{4th International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2022)},
  pages =	{1--82},
  series =	{Open Access Series in Informatics (OASIcs)},
  ISBN =	{978-3-95977-274-7},
  ISSN =	{2190-6807},
  year =	{2023},
  volume =	{110},
  editor =	{Amoussou-Guenou, Yackolley and Kiayias, Aggelos and Verdier, Marianne},
  publisher =	{Schloss Dagstuhl -- Leibniz-Zentrum f{\"u}r Informatik},
  address =	{Dagstuhl, Germany},
  URL =		{https://drops.dagstuhl.de/entities/document/10.4230/OASIcs.Tokenomics.2022},
  URN =		{urn:nbn:de:0030-drops-184169},
  doi =		{10.4230/OASIcs.Tokenomics.2022},
  annote =	{Keywords: OASIcs, Volume 110, Tokenomics 2022, Complete Volume}
}
Document
Front Matter
DOI: 10.4230/OASIcs.Tokenomics.2022.0
Front Matter, Table of Contents, Preface, Conference Organization

Authors: Yackolley Amoussou-Guenou, Aggelos Kiayias, and Marianne Verdier

Published in: OASIcs, Volume 110, 4th International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2022)

Abstract
Front Matter, Table of Contents, Preface, Conference Organization
Cite as

4th International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2022). Open Access Series in Informatics (OASIcs), Volume 110, pp. 0:i-0:xii, Schloss Dagstuhl – Leibniz-Zentrum für Informatik (2023)

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@InProceedings{amoussouguenou_et_al:OASIcs.Tokenomics.2022.0,
  author =	{Amoussou-Guenou, Yackolley and Kiayias, Aggelos and Verdier, Marianne},
  title =	{{Front Matter, Table of Contents, Preface, Conference Organization}},
  booktitle =	{4th International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2022)},
  pages =	{0:i--0:xii},
  series =	{Open Access Series in Informatics (OASIcs)},
  ISBN =	{978-3-95977-274-7},
  ISSN =	{2190-6807},
  year =	{2023},
  volume =	{110},
  editor =	{Amoussou-Guenou, Yackolley and Kiayias, Aggelos and Verdier, Marianne},
  publisher =	{Schloss Dagstuhl -- Leibniz-Zentrum f{\"u}r Informatik},
  address =	{Dagstuhl, Germany},
  URL =		{https://drops.dagstuhl.de/entities/document/10.4230/OASIcs.Tokenomics.2022.0},
  URN =		{urn:nbn:de:0030-drops-184172},
  doi =		{10.4230/OASIcs.Tokenomics.2022.0},
  annote =	{Keywords: Front Matter, Table of Contents, Preface, Conference Organization}
}
Document
DOI: 10.4230/OASIcs.Tokenomics.2019.3
A Puff of Steem: Security Analysis of Decentralized Content Curation

Authors: Aggelos Kiayias, Benjamin Livshits, Andrés Monteoliva Mosteiro, and Orfeas Stefanos Thyfronitis Litos

Published in: OASIcs, Volume 71, International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2019)

Abstract
Decentralized content curation is the process through which uploaded posts are ranked and filtered based exclusively on users' feedback. Platforms such as the blockchain-based Steemit employ this type of curation while providing monetary incentives to promote the visibility of high quality posts according to the perception of the participants. Despite the wide adoption of the platform very little is known regarding its performance and resilience characteristics. In this work, we provide a formal model for decentralized content curation that identifies salient complexity and game-theoretic measures of performance and resilience to selfish participants. Armed with our model, we provide a first analysis of Steemit identifying the conditions under which the system can be expected to correctly converge to curation while we demonstrate its susceptibility to selfish participant behaviour. We validate our theoretical results with system simulations in various scenarios.
Cite as

Aggelos Kiayias, Benjamin Livshits, Andrés Monteoliva Mosteiro, and Orfeas Stefanos Thyfronitis Litos. A Puff of Steem: Security Analysis of Decentralized Content Curation. In International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2019). Open Access Series in Informatics (OASIcs), Volume 71, pp. 3:1-3:21, Schloss Dagstuhl – Leibniz-Zentrum für Informatik (2020)

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@InProceedings{kiayias_et_al:OASIcs.Tokenomics.2019.3,
  author =	{Kiayias, Aggelos and Livshits, Benjamin and Monteoliva Mosteiro, Andr\'{e}s and Thyfronitis Litos, Orfeas Stefanos},
  title =	{{A Puff of Steem: Security Analysis of Decentralized Content Curation}},
  booktitle =	{International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2019)},
  pages =	{3:1--3:21},
  series =	{Open Access Series in Informatics (OASIcs)},
  ISBN =	{978-3-95977-108-5},
  ISSN =	{2190-6807},
  year =	{2020},
  volume =	{71},
  editor =	{Danos, Vincent and Herlihy, Maurice and Potop-Butucaru, Maria and Prat, Julien and Tucci-Piergiovanni, Sara},
  publisher =	{Schloss Dagstuhl -- Leibniz-Zentrum f{\"u}r Informatik},
  address =	{Dagstuhl, Germany},
  URL =		{https://drops.dagstuhl.de/entities/document/10.4230/OASIcs.Tokenomics.2019.3},
  URN =		{urn:nbn:de:0030-drops-119675},
  doi =		{10.4230/OASIcs.Tokenomics.2019.3},
  annote =	{Keywords: blockchain, content curation, decentralized, voting}
}
Document
DOI: 10.4230/OASIcs.Tokenomics.2019.7
Cryptocurrency Egalitarianism: A Quantitative Approach

Authors: Dimitris Karakostas, Aggelos Kiayias, Christos Nasikas, and Dionysis Zindros

Published in: OASIcs, Volume 71, International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2019)

Abstract
Since the invention of Bitcoin one decade ago, numerous cryptocurrencies have sprung into existence. Among these, proof-of-work is the most common mechanism for achieving consensus, whilst a number of coins have adopted "ASIC-resistance" as a desirable property, claiming to be more "egalitarian," where egalitarianism refers to the power of each coin to participate in the creation of new coins. While proof-of-work consensus dominates the space, several new cryptocurrencies employ alternative consensus, such as proof-of-stake in which block minting opportunities are based on monetary ownership. A core criticism of proof-of-stake revolves around it being less egalitarian by making the rich richer, as opposed to proof-of-work in which everyone can contribute equally according to their computational power. In this paper, we give the first quantitative definition of a cryptocurrency’s egalitarianism. Based on our definition, we measure the egalitarianism of popular cryptocurrencies that (may or may not) employ ASIC-resistance, among them Bitcoin, Ethereum, Litecoin, and Monero. Our simulations show, as expected, that ASIC-resistance increases a cryptocurrency’s egalitarianism. We also measure the egalitarianism of a stake-based protocol, Ouroboros, and a hybrid proof-of-stake/proof-of-work cryptocurrency, Decred. We show that stake-based cryptocurrencies, under correctly selected parameters, can be perfectly egalitarian, perhaps contradicting folklore belief.
Cite as

Dimitris Karakostas, Aggelos Kiayias, Christos Nasikas, and Dionysis Zindros. Cryptocurrency Egalitarianism: A Quantitative Approach. In International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2019). Open Access Series in Informatics (OASIcs), Volume 71, pp. 7:1-7:21, Schloss Dagstuhl – Leibniz-Zentrum für Informatik (2020)

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@InProceedings{karakostas_et_al:OASIcs.Tokenomics.2019.7,
  author =	{Karakostas, Dimitris and Kiayias, Aggelos and Nasikas, Christos and Zindros, Dionysis},
  title =	{{Cryptocurrency Egalitarianism: A Quantitative Approach}},
  booktitle =	{International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2019)},
  pages =	{7:1--7:21},
  series =	{Open Access Series in Informatics (OASIcs)},
  ISBN =	{978-3-95977-108-5},
  ISSN =	{2190-6807},
  year =	{2020},
  volume =	{71},
  editor =	{Danos, Vincent and Herlihy, Maurice and Potop-Butucaru, Maria and Prat, Julien and Tucci-Piergiovanni, Sara},
  publisher =	{Schloss Dagstuhl -- Leibniz-Zentrum f{\"u}r Informatik},
  address =	{Dagstuhl, Germany},
  URL =		{https://drops.dagstuhl.de/entities/document/10.4230/OASIcs.Tokenomics.2019.7},
  URN =		{urn:nbn:de:0030-drops-119715},
  doi =		{10.4230/OASIcs.Tokenomics.2019.7},
  annote =	{Keywords: blockchain, egalitarianism, cryptocurrency, economics, proof-of-work, proof-of-stake}
}
Document
DOI: 10.4230/DagSemProc.08491.5
Sound and Fine-grain Specification of Ideal Functionalities

Authors: Juan Garay, Aggelos Kiayias, and Hong-Sheng Zhou

Published in: Dagstuhl Seminar Proceedings, Volume 8491, Theoretical Foundations of Practical Information Security (2009)

Abstract
Nowadays it is widely accepted to formulate the security of a protocol carrying out a given task via the "trusted-party paradigm," where the protocol execution is compared with an ideal process where the outputs are computed by a trusted party that sees all the inputs. A protocol is said to securely carry out a given task if running the protocol with a realistic adversary amounts to "emulating" the ideal process with the appropriate trusted party. In the Universal Composability (UC) framework the program run by the trusted party is called an ideal functionality. While this simulation-based security formulation provides strong security guarantees, its usefulness is contingent on the properties and correct specification of the ideal functionality, which, as demonstrated in recent years by the coexistence of complex, multiple functionalities for the same task as well as by their "unstable" nature, does not seem to be an easy task. In this paper we address this problem, by introducing a general methodology for the sound specification of ideal functionalities. First, we introduce the class of canonical ideal functionalities for a cryptographic task, which unifies the syntactic specification of a large class of cryptographic tasks under the same basic template functionality. Furthermore, this representation enables the isolation of the individual properties of a cryptographic task as separate members of the corresponding class. By endowing the class of canonical functionalities with an algebraic structure we are able to combine basic functionalities to a single final canonical functionality for a given task. Effectively, this puts forth a bottom-up approach for the specification of ideal functionalities: first one defines a set of basic constituent functionalities for the task at hand, and then combines them into a single ideal functionality taking advantage of the algebraic structure. In our framework, the constituent functionalities of a task can be derived either directly or, following a translation strategy we introduce, from existing game-based definitions; such definitions have in many cases captured desired individual properties of cryptographic tasks, albeit in less adversarial settings than universal composition. Our translation methodology entails a sequence of steps that derive a corresponding canonical functionality given a game-based definition. In this way, we obtain a well-defined mapping of game-based security properties to their corresponding UC counterparts. Finally, we demonstrate the power of our approach by applying our methodology to a variety of basic cryptographic tasks, including commitments, digital signatures, zero-knowledge proofs, and oblivious transfer. While in some cases our derived canonical functionalities are equivalent to existing formulations, thus attesting to the validity of our approach, in others they differ, enabling us to "debug" previous definitions and pinpoint their shortcomings.
Cite as

Juan Garay, Aggelos Kiayias, and Hong-Sheng Zhou. Sound and Fine-grain Specification of Ideal Functionalities. In Theoretical Foundations of Practical Information Security. Dagstuhl Seminar Proceedings, Volume 8491, Schloss Dagstuhl – Leibniz-Zentrum für Informatik (2009)

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@InProceedings{garay_et_al:DagSemProc.08491.5,
  author =	{Garay, Juan and Kiayias, Aggelos and Zhou, Hong-Sheng},
  title =	{{Sound and Fine-grain Specification of Ideal Functionalities}},
  booktitle =	{Theoretical Foundations of Practical Information Security},
  series =	{Dagstuhl Seminar Proceedings (DagSemProc)},
  ISSN =	{1862-4405},
  year =	{2009},
  volume =	{8491},
  editor =	{Ran Canetti and Shafi Goldwasser and G\"{u}nter M\"{u}ller and Rainer Steinwandt},
  publisher =	{Schloss Dagstuhl -- Leibniz-Zentrum f{\"u}r Informatik},
  address =	{Dagstuhl, Germany},
  URL =		{https://drops.dagstuhl.de/entities/document/10.4230/DagSemProc.08491.5},
  URN =		{urn:nbn:de:0030-drops-18911},
  doi =		{10.4230/DagSemProc.08491.5},
  annote =	{Keywords: Security definitions, universal composability, cryptographic protocols, lattices and partial orders.}
}
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