What is Blockchain Consensus in Blockchain?

What is the role of the Consensus Mechanism in Blockchain?

The biggest issue with Byzantine is reaching a consensus. Nodes cannot agree or have a higher difficulty score if even one error occurs. Consensus algorithms, on the other hand, can handle this sort of challenge. The primary purpose is to achieve a given goal by whatever means necessary. Blockchain consensus models are far more dependable and fault-tolerant than Byzantine ones.

The Byzantine Fault Tolerance is a mechanism having a specific failure event. The problem is known as the Byzantine Generals’ problem. A distributed computer system is the most significant way to experience the issue. There are several situations in which consensus systems fail.

Types of Consensus Mechanisms

(1) Proof of Work consensus: PoW is now the most prevalent and one of the most robust blockchain consensus mechanisms. Before approving the new block to the ledger, the miner must solve mathematically challenging riddles on the new block. After completing the challenge, the solution is sent to other miners for validation before being included in their ledger copies. According to the PoW algorithm, nodes must adopt the fork that carries work, and it is improbable that two competing forks would create the next block together.

With the adoption of proof-of-work (PoW), the blockchain network verifies each transaction and prevents double-spending. After verification, minors finalize and authorize transactions. If someone tries to replicate a transaction, the web will detect it as a forgery and will not be approved. Once a transaction is accepted, you cannot double-spend.

How Does POW Work? 

First, the miners will solve all the problems, after which the ecosystem creates new blocks and confirm the transactions. It’s hard to predict how difficult a challenge will be.

It significantly depends on the maximum number of users, the minimum current power, and the total network load. New blocks include a Hashing Algorithm, each consisting of the previous block’s hash function. As a result, the network provides an extra layer of security and prohibits any form of infringement. A new block is constructed, and the transaction is confirmed after a miner solves the riddle.

(2) Delegated Proof-of-stake (DPoW)

DPoS is not the same as PoS. Token holders do not work on the validity of the blocks directly but rather choose delegates to do so for them. A DPoS system typically has between 21 and 100 designated representatives. The delegates are regularly rotated and given the order to present their blocks. If you have fewer delegates, they may arrange themselves more effectively and generate time slots to publish blocks. If the representatives consistently miss their blocks or post erroneous transactions, the token holders vote them out and replace them with another chosen delegate.

(3) Proof-of-stake consensus:

PoS is a PoW alternative that requires fewer CPU calculations for mining. This feature is similar to an algorithm with the same goal as PoW, but the approach is somewhat distinguishable. A miner is paid for solving mathematical problems and producing new blocks in PoW.

At the same time, the creator of a new partnership in Proof-of-Stake is also chosen deterministic based on its wealth, also known as stake. This step indicates that there is no block reward in the PoS process. As a result, the miners profit from the transaction fees. The PoS system has advantages and disadvantages, and the actual implementation is relatively complicated.

How Does POS work?

Minors are pre-selected in this consensus procedure. Even though the process is random, not every miner can participate in the staking. The network selects them randomly. You will be eligible to join the web as a node if you have a certain number of coins in your wallet.

After becoming a node, you must deposit a particular quantity of coins to be eligible to become a miner. The system will then use a voting method to choose the validators. When everything is finished, the miners will stake the bare minimum for the unique wallet staking.

In reality, the procedure is relatively straightforward. New blocks will be generated following the number of coins in the wallet. For example, if you possess 5% of all currencies, you can mine 5% of all new blocks.

(4) Byzantine Fault Tolerance (BFT)

BFT is used to resolve the problem of a rogue or unreliable node. The blockchain’s dependability collapses if any community member distributes inaccurate information about transactions to others, and no centralized body can step in to repair it. To address this, PoW already provides BFT via its processing power. PoS, on the other hand, requires a more definitive answer. Nodes will regularly vote to determine the genuine transaction. Using a variant of PoS that works with BFT is the most viable solution to blockchain transaction approval.

Also Read: Byzantine Fault Tolerance (BFT) (blockchainshiksha.com)

(5) Practical Byzantine Fault Tolerance (PBFT)

Hyperledger supports two consensus algorithms: Practical Byzantine Fault Tolerance (PBFT) and SIEVE, which can handle non-deterministic chain code execution. PBFT was the first approach to establish consensus in the event of a Byzantine failure. The PBFT technique is also used by Stellar and Ripple. Each ‘generic’ in the PBFT process handles an internal state, a continuing information status. 

When a message is received, a general uses the message in conjunction with their internal state to initiate a computing process. This calculating procedure polls the broad public on their thoughts on the message. After making a decision, the general informs the other generals in the system. Based on the overall number of decisions made by all the generals, a consensus is reached.

(6) SIEVE

Hyperledger Fabric uses the SIEVE consensus method, enabling the network to detect and eliminate potentially non-deterministic requests while still achieving consensus on the output of recommended transactions.

(7) Proof of Burn (PoB) Consensus

To earn a proportional right to mine new blocks and verify transactions, miners purposely and permanently destroy or “burn” tokens under PoB. The more tokens a miner burns, the more likely the miner will be chosen as the next block validator. Miners in a PoB configuration can use significantly less energy than traditional PoW systems by demonstrating their loyalty to the network through intentional token destruction rather than using computing resources and leveraging sophisticated mining hardware.

(8) Proof of Capacity (PoC) / Proof of Space (PoSpace)

Proof of Capacity, also known as Proof of Capacity, decides mining rights and validates transactions using the available hard drive space in a miner’s device rather than using computational resources. Even before the mining activity begins, a list of potential cryptographic mining solutions is kept in the mining device’s hard drive, with larger hard drives capable of storing more potential solution values. 

As a result, the more a miner’s storage capacity, the more likely that miner will be able to match the required hash value of a new block production cycle and earn the mining reward. This protocol was created to circumvent the energy inefficiencies of traditional Proof of Work (PoW) mechanisms and the hoarding incentives introduced by many Proof of Stake (PoS) arrangements. 

(9) Evidence of Contribution (PoC/PoCo) Mechanism of Consensus

Proof of Contribution (PoC) protocols use specialized algorithms to monitor the contributions of all active nodes in a network throughout each consensus round and then award the privilege to generate the following block to the node(s) with the highest contribution value. 

Under PoC, each executable action can be assigned a specific confidence threshold, which establishes the minimal amount of confidence required for the network to validate the calculation associated with that action.

Users who want to do an on-chain computation within a PoC consensus mechanism must first stake a security deposit. Each user’s contribution level is determined by their past track record, stake amount, and the accuracy of their calculated result for every particular activity.

For each consensus round, a series of eligible users suggest relevant computation results until a user successfully provides an impact with a confidence level that meets the required threshold. The nodes that compute the validated result will then be rewarded with the transaction fee from the user who requested the on-chain activity that just occurred, as well as the stake lost by users who calculated an incorrect result before the reputations of all involved users are readjusted.

Almost always, many users will provide the same accurate result for any given computation. In these cases, the users’ confidence levels are combined to compute the result’s overall confidence score, and the consensus rewards are distributed among the users. While not widely utilized, Proof of Concept has been successfully applied in projects where the network must confirm on-chain operations performed off-chain securely and transparently.

Bottom line: The consensus algorithms utilized by various blockchain platforms are motivated mainly by the applications the platform hopes to offer and the threats to the chain’s integrity. Permissionless systems attain consensus among many untrusted peers using computational difficulties.

While approved blockchains use a less scalable but higher throughput approach that guarantees speedier transactions. Various factors are evaluated while selecting the best consensus model for a particular network, including the intended network, participant relationships, and functional and non-functional elements.

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