Pseudo-Equilibria, or: How to Stop Worrying About Crypto and Just Analyze the Game

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Main Authors: Psomas, Alexandros, Terzoglou, Athina, Wei, Yu, Zikas, Vassilis
Format: Preprint
Published: 2025
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author Psomas, Alexandros
Terzoglou, Athina
Wei, Yu
Zikas, Vassilis
author_facet Psomas, Alexandros
Terzoglou, Athina
Wei, Yu
Zikas, Vassilis
contents We consider the problem of a game theorist analyzing a game that uses cryptographic protocols. Ideally, a theorist abstracts protocols as ideal, implementation-independent primitives, letting conclusions in the "ideal world" carry over to the "real world." This is crucial, since the game theorist cannot--and should not be expected to--handle full cryptographic complexity. In today's landscape, the rise of distributed ledgers makes a shared language between cryptography and game theory increasingly necessary. The security of cryptographic protocols hinges on two types of assumptions: state-of-the-world (e.g., "factoring is hard") and behavioral (e.g., "honest majority"). We observe that for protocols relying on behavioral assumptions (e.g., ledgers), our goal is unattainable in full generality. For state-of-the-world assumptions, we show that standard solution concepts, e.g., ($ε$-)Nash equilibria, are not robust to transfer from the ideal to the real world. We propose a new solution concept: the pseudo-Nash equilibrium. Informally, a profile $s=(s_1,\dots,s_n)$ is a pseudo-Nash equilibrium if, for any player $i$ and deviation $s'_i$ with higher expected utility, $i$'s utility from $s_i$ is (computationally) indistinguishable from that of $s'_i$. Pseudo-Nash is simpler and more accessible to game theorists than prior notions addressing the mismatch between (asymptotic) cryptography and game theory. We prove that Nash equilibria in games with ideal, unbreakable cryptography correspond to pseudo-Nash equilibria when ideal cryptography is instantiated with real protocols (under state-of-the-world assumptions). Our translation is conceptually simpler and more general: it avoids tuning or restricting utility functions in the ideal game to fit quirks of cryptographic implementations. Thus, pseudo-Nash lets us study game-theoretic and cryptographic aspects separately and seamlessly.
format Preprint
id arxiv_https___arxiv_org_abs_2506_22089
institution arXiv
publishDate 2025
record_format arxiv
spellingShingle Pseudo-Equilibria, or: How to Stop Worrying About Crypto and Just Analyze the Game
Psomas, Alexandros
Terzoglou, Athina
Wei, Yu
Zikas, Vassilis
Computer Science and Game Theory
Cryptography and Security
We consider the problem of a game theorist analyzing a game that uses cryptographic protocols. Ideally, a theorist abstracts protocols as ideal, implementation-independent primitives, letting conclusions in the "ideal world" carry over to the "real world." This is crucial, since the game theorist cannot--and should not be expected to--handle full cryptographic complexity. In today's landscape, the rise of distributed ledgers makes a shared language between cryptography and game theory increasingly necessary. The security of cryptographic protocols hinges on two types of assumptions: state-of-the-world (e.g., "factoring is hard") and behavioral (e.g., "honest majority"). We observe that for protocols relying on behavioral assumptions (e.g., ledgers), our goal is unattainable in full generality. For state-of-the-world assumptions, we show that standard solution concepts, e.g., ($ε$-)Nash equilibria, are not robust to transfer from the ideal to the real world. We propose a new solution concept: the pseudo-Nash equilibrium. Informally, a profile $s=(s_1,\dots,s_n)$ is a pseudo-Nash equilibrium if, for any player $i$ and deviation $s'_i$ with higher expected utility, $i$'s utility from $s_i$ is (computationally) indistinguishable from that of $s'_i$. Pseudo-Nash is simpler and more accessible to game theorists than prior notions addressing the mismatch between (asymptotic) cryptography and game theory. We prove that Nash equilibria in games with ideal, unbreakable cryptography correspond to pseudo-Nash equilibria when ideal cryptography is instantiated with real protocols (under state-of-the-world assumptions). Our translation is conceptually simpler and more general: it avoids tuning or restricting utility functions in the ideal game to fit quirks of cryptographic implementations. Thus, pseudo-Nash lets us study game-theoretic and cryptographic aspects separately and seamlessly.
title Pseudo-Equilibria, or: How to Stop Worrying About Crypto and Just Analyze the Game
topic Computer Science and Game Theory
Cryptography and Security
url https://arxiv.org/abs/2506.22089