Games & Graphs
Incentives in Local Protocol
Snapshot-relative diffusion on the transaction graph dynamically adjusts incentives while keeping validator work bounded and Sybil resistance strong.
Local Protocol leverages snapshot-relative diffusion on the transaction graph to dynamically adjust incentives while maintaining strong Sybil resistance. Diffusion-derived outputs enter the system through bounded, challengeable claims, keeping validator work bounded and predictable.
Intuition
Diffusion answers: “if we start from verified activity and let trust spread, where does it end up?” Those scores then feed reward multipliers, risk limits, and market policy knobs.Related work
Graph diffusion for ranking/trust: PageRank, Personalized PageRank, and seed-set anchoring like TrustRank.Why it fits
The protocol wants local actions (a completed delivery) to have non-local effects (your neighborhood becomes more trusted). Diffusion provides that spillover with clear semantics.Next Steps
In the following sections, we’ll build up the full model:
- The Transaction Graph
- Snapshot-Relative Diffusion (PageRank / PPR)
- Markets
- Graph Commitments & Epoch Snapshots
- Optimistic Diffusion Claims
- Basic Example (PPR intuition)
- Insurance & Dispute Resolution
After you’re comfortable with the transaction graph, you can dive into the other core protocol layers: