We introduce Casper, a proof of stake-based finality system which overlays an existing proof of work blockchain. Casper is a partial consensus mechanism combining proof of stake algorithm research and Byzantine fault tolerant consensus theory. We introduce our system, prove some desirable features, and show defenses against long range revisions and catastrophic crashes. The Casper overlay provides almost any proof of work chain with additional protections against block reversions.
The very obstacle of Proof of Stake(PoS) is Nothing at Stake, which means a malicious validator can performe an attack with any cost. Casper improves byzantine fault tolerance(BFT) and introduces a feature called Accountability which penalizes malfeasant validators by slashing their deposits. Casper also enables validator set to change. Long Range Revisions and Castastrophic Crashes are two common attacks which Casper could deal with well. 1/3 of validators drop offline is also able to be solved with a week tradeoff. An important and practical point is that Casper works as an overlay on Ethereum and works as an upgrade to gradually substitute current Proof of Work(PoW) to PoS.