Bitcoin is a cryptocurrency that has recently emerged as a popular medium of exchange, with a rich and extensive ecosystem. The Bitcoin network operates at over 42×1018 FLOPS, with a total market capitalization of approximately US$1.5 billion as of October 2013. At the heart of Bitcoin's operation is a global public ledger, called the blockchain, which records all transactions between Bitcoin customers. Blockchain security is established by a chain of cryptographic puzzles, solved by a loosely organized network of participants called miners. Each miner who successfully solves a cryptopuzzle can record a series of transactions and collect a Bitcoin reward. The more mining power (resources) a miner applies, the higher his chances of solving the puzzle sooner. This reward structure provides an incentive for miners to contribute their resources to the system and is essential to the decentralized nature of the currency. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay The Bitcoin protocol requires the majority of miners to be honest; that is, follow the Bitcoin protocol as prescribed. By construction, if a group of colluding miners comes to control the majority of mining power in the network, the currency stops being decentralized and becomes controlled by the colluding group. Such a group can, for example, ban certain or all transactions. It is therefore crucial that the protocol is designed so that miners have no incentive to form such large colluding groups. Empirical evidence shows that Bitcoin miners behave strategically and form pools. Specifically, because rewards are distributed at random and infrequent intervals, miners form mining pools to reduce the variance of their revenue rate. Within such pools, all members contribute to the solution of each cryptopuzzle and share the rewards proportionally to their contributions. As far as we know, so far such pools have been benign and have followed protocol. Indeed, conventional wisdom has long held that the Bitcoin protocol is incentive-friendly; that is, a rational minority group's best strategy is to be honest, and a minority of colluding miners cannot gain disproportionate benefits by deviating from protocol. Since the protocol is believed to reward miners strictly proportional to the ratio of overall mining power they control, a miner in a large pool is believed to earn the same revenue as they would in a small pool. As a result, there is no benefit to colluding miners in organizing themselves into ever-larger pools. Therefore, pool formation by honest and rational miners poses no threat to the system. Conventional wisdom is wrong: the Bitcoin protocol, as prescribed and implemented, is not incentive-friendly. We describe a strategy that can be used by a minority pool to earn more revenue than the pool's fair share, i.e., more than its ratio to total mining power. The key idea behind this strategy, called Selfish Mining, is that a pool keeps discovered blocks private, thus intentionally forking the chain. Honest nodes continue to mine on the public chain, while the pool mines on its private branch. If the pool discovers more blocks, it develops a longer lead on the public chain and continues to keep these new blocks private. When the public branch approaches the private branch of the pool in length, selfish miners reveal the blocks of their private chain to the public. This strategy brings i.