🤖 AI Summary
This paper identifies how blockchain protocol malleability elevates miners’ time preference, undermines long-run cooperative equilibria, and incentivizes a strategic shift from productive investment toward political rent-seeking and influence contests. Method: Drawing on Austrian capital theory (Böhm-Bawerk, Mises, Hayek) and repeated game frameworks, the authors construct an institution–behavior interaction model to analyze how protocol immutability functions as a critical institutional anchor—reducing time preference, enhancing calculability, and reinforcing strategic consistency. Contribution/Results: The study pioneers the systematic integration of time preference theory into blockchain incentive design, demonstrating that rigid, rule-based protocols restore entrepreneurial confidence by mitigating uncertainty and intertemporal distortion, thereby enabling sustainable network equilibria grounded in credible commitment and long-horizon coordination.
📝 Abstract
This paper integrates Austrian capital theory with repeated game theory to examine strategic miner behaviour under different institutional conditions in blockchain systems. It shows that when protocol rules are mutable, effective time preference rises, undermining rational long-term planning and cooperative equilibria. Using formal game-theoretic analysis and Austrian economic principles, the paper demonstrates how mutable protocols shift miner incentives from productive investment to political rent-seeking and influence games. The original Bitcoin protocol is interpreted as an institutional anchor: a fixed rule-set enabling calculability and low time preference. Drawing on the work of Bohm-Bawerk, Mises, and Hayek, the argument is made that protocol immutability is essential for restoring strategic coherence, entrepreneurial confidence, and sustainable network equilibrium.