Instruct: Identify the main and secondary category of Arxiv papers based on the titles and abstracts
Query: Controlling Transaction Rate in Tangle Ledger: A Principal Agent Problem
  Approach   Tangle is a distributed ledger technology that stores data as a directed
acyclic graph (DAG). Unlike blockchain, Tangle does not require dedicated
miners for its operation. This makes Tangle suitable for Internet of Things
(IoT) applications. To prevent congestion and spamming, distributed ledgers
have a built-in transaction rate control mechanism. This is typically achieved
by increasing or decreasing the proof of work (PoW) difficulty level;
unfortunately, this simplistic mechanism gives an unfair advantage to users
with high computational power. This paper proposes a principal-agent problem
(PAP) framework from microeconomics to control the transaction rate in Tangle.
With users as the agents and the transaction rate controller as the principal,
we design a truth-telling mechanism to assign PoW difficulty levels to agents
as a function of their computational power. The solution of the PAP is achieved
by compensating a higher PoW difficulty level with a larger weight/reputation
for the transaction. The solution of PAP is obtained by solving a mixed-integer
optimization problem. Moreover, we show that the decision variables have useful
structures: the optimal solution of the PAP increases with the computational
power of the agents. We also show that the optimal PoW increases with the
number of agents. The structural result reduces the search space of the
mixed-integer program and enables efficient computation of the optimal
mechanism. Finally, via numerical examples, we illustrate the transaction rate
control mechanism and study its impact on the dynamics of Tangle.

11
The categories of this paper are: hep-lat
25
The categories of this paper are: patt-sol
3
The categories of this paper are: physics
23
The categories of this paper are: solv-int
33
The categories of this paper are: plasm-ph
5
The categories of this paper are: gr-qc
26
The categories of this paper are: bayes-an
14
The categories of this paper are: math-ph
35
The categories of this paper are: mtrl-th
22
The categories of this paper are: chao-dyn
0
The categories of this paper are: hep-ph
31
The categories of this paper are: ao-sci
32
The categories of this paper are: atom-ph
36
The categories of this paper are: cmp-lg
29
The categories of this paper are: funct-an
17
The categories of this paper are: q-fin