CS 224 W Project Report Network Analysis of Weighted Signed Bitcoin Networks
Bitcoin has become an increasingly popular cryptocurrency because of the anonymity it offers. Any transaction between two bitcoin users is stored in a public ledger (called blockchain) While there has been analysis of various Bitcoin networks [RS12, FKP14, OKH13] most of the papers consider only unsigned Bitcoin networks and only do basic analysis of the transaction graph, such as amount of bitcoin exchanged. In this paper, we will analyze the trust network formed by users of Bitcoin as weighted signed networks. Since anonymity is the main feature in bitcoin transactions, a user's reputation needs to be qualified to avoid fraudulent transactions. Towards this goal, we will study signed, weighted bitcoin trust networks. Network properties of these networks will be examined and the theories of balance and status from the social psychological domain will be applied to model user trust.