Bitcoin's Theoretical Foundations

At the core of Bitcoin is a novel algorithm that enables a network of anonymous participants to eventually agree on an ordered sequence of transactions. In this talk, I will present a formal model of Bitcoin’s requirements and sketch a correctness proof that extends the argument from Satoshi’s whitepaper. I will also suggest three ways to improve the basic algorithm:
1) A more realistic (partially synchronous) latency model will remove the need to globally configure a subjective “risk” parameter.
2) An enhancement to the blockchain data structure will reduce the amount of trusted hardware needed to validate transactions.
3) An alternate proof-of-work puzzle that unifies mining with transaction validation will allow Bitcoin’s infrastructure to scale more efficiently.