Arweave Miners Are Sacrificing Their $AR

Today, Sam Williams, founder of Arweave, shared on Twitter a new behaviour emerging in the Arweave ecosystem.

Very interesting new behaviour emerging in the Arweave ecosystem today: Sacrifice mining.

tl;dr: Miners are now sacrificing AR to improve their performance.

Here’s how it works, and what it means for the network ????

— Sam Williams (@samecwilliams) March 22, 2021

What does it mean for the network?

In Arweave, users pay tokens to store data. Normally, it happens in two steps :

1. Payment via a transaction
2. Seeding

The user sends a transaction which is settled into the network, committing their payment. Most of these tokens go to the endowment, where they are slowly unlocked to miners over an extremely long period of time rewarding them tokens by replicating the data in the network and constantly testing its validity.

Next, they seed the data to a sufficient number of miners.  Over time to these miners share the data with one another in order to gain access to more data, explaining this mechanism : optimistic tit-for-tat

Sam also mentioned that sacrifice mining works by storing data, but not seeding it. This gives the miner a small increase in performance at the cost of some Arweave tokens that are contributed to the endowment where they remain for many decades. This essentially adds an economic layer of security to the network’s mining process.

The effects are as follows:

1. Nothing changes for normal users. Their data is always preferable for miners to store over sacrifice data, as user data is freely traded between nodes in the network.
2. More tokens are added to the Arweave endowment, and taken out of circulating supply.
3. An additional incentive is created to buy and use Arweave tokens to provide economic security during the mining process.
4. If sacrifice mining data is never seeded, then more tokens will be given to miners for storing user data later in the network’s life, thanks to the endowment pool. This will increase the number of user data replications even further over time.
5. One trade-off is that more TXIDs (those involved in sacrifice mining) will not resolve to public data.

This has been possible in the network since the launch of 2.0 last year where the trade-off for vastly increased scalability was made for guaranteed discoverability.

Sam Williams also warned miners :

We have not actively encouraged sacrifice mining previously, as its profitability is hard to calculate. This is because sacrifice miners will compete against one another to contribute more tokens to the endowment.

As one sacrifice miner commits tokens, they diminish the rewards of other sacrificers. To some extent, this dynamic is always the case in crypto mining but the sacrifice route is even more extreme than normal.

If, however, there is significant community demand, the core Arweave team intends to provide open source tools that allow miners to take part in this way.

Finally, Sam mentioned that so far, over $11,000 worth of Arweave tokens have been sacrificed to the endowment today alone.