Draft BIP for discussion: Time-Shifted Proof of Work (TSPOW) — an informational consensus-design proposal

TSPOW suggests a novel two-stage mechanism where miners first generate a valid initial-hash that meets the specified difficulty threshold, earning them a warrant which entitles them to the coin reward upon later validation. This warrant is subject to expiration, adding a temporal element to mining rewards. In the second stage, block producers are selected from a pool of warrant holders, using the lowest hash value derived either from an external beacon or the fallback seed of the previous block's hash.

This proposed method aims to stabilize the variance in block times by transforming the block interval into a sum of Gamma-distributed intervals. The division of time variance by the number of accumulated warrants (k) effectively reduces it, addressing the wide confirmation-latency variance seen in current proof-of-work systems. However, the proposal acknowledges that it does not solve the fundamental security issues associated with majority attacks, where entities controlling over 50% of mining operations can still influence outcomes significantly.

Furthermore, TSPOW necessitates a hard fork due to its extensive changes in the block header structure and block authorship process, making it a backward-incompatible modification. It introduces a potential new security vulnerability concerning the reliance on an external beacon for random selection in the block production process. Despite these concerns, the design includes mechanisms such as chained FIFO and per-owner caps to mitigate risks like pool-flooding, although these require further testing.

For those interested in a deeper understanding of the technical underpinnings and potential implications of TSPOW, detailed documents and tools including whitepapers, reference implementations, and verification scripts are made available in the TSPOW repository on GitHub. This repository serves as a resource for ongoing discussion and refinement of the proposal, inviting feedback particularly on its approach to block-time stability, the economic model related to delayed mining rewards, and the trust model for the external beacon used in block producer selection.