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Evolution of Shares in a Proof-of-Stake Cryptocurrency

Abstract : Do the rich always get richer by investing in a cryptocurrency for which new coins are issued according to a Proof-of-Stake (PoS) protocol? We answer this question in the negative: Without trading, the investor shares in the cryptocurrency are martingales that converge to a well-defined limiting distribution, hence are stable in the long run. This result is robust to allowing trading when investors are risk-neutral. Then, investors have no incentive to accumulate coins and gamble on the PoS protocol, but weakly prefer not to trade.
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Preprints, Working Papers, ...
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https://hal-hec.archives-ouvertes.fr/hal-02896092
Contributor : Antoine Haldemann <>
Submitted on : Friday, July 10, 2020 - 12:26:30 PM
Last modification on : Sunday, August 2, 2020 - 8:44:04 AM

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Ioanid Rosu, Fahad Saleh. Evolution of Shares in a Proof-of-Stake Cryptocurrency. 2020. ⟨hal-02896092⟩

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