Playing Strategic Games in The Open Network (TON): Analyzing the Robustness of Proof-of-Stake Slashing Incentives

Abstract

This paper examines the strategic behavior of rational actors in the TON blockchain, focusing on their responses to slashing mechanisms in a proof-of-stake (PoS) environment. Slashing introduces financial penalties for behavior that threatens network integrity, addressing the nothing-at-stake problem, where validators in PoS systems can support multiple chains at no cost. Although slashing is intended to deter malicious behavior by Byzantine actors, it also affects rational validators by altering their expected returns. Using a game-theoretic model inspired by the BAR framework, this study examines how rational, utility-maximizing validators weigh the risks and rewards of violating or enforcing slashing mechanisms in the presence of potentially Byzantine actors when penalty enforcement is uncertain. Located at the intersection of game theory and distributed systems, this research sheds light on compliance and deviation dynamics in PoS networks, contributing to a deeper understanding of incentive alignment in blockchain governance.