Proof Of Elapsed Time Consensus Algorithm
Since the PoW algorithm became standard for Bitcoin-like cryptocurrencies, there were many attempts to change the key component of consensus achievement. The reason is simple:
- PoW requires a lot of efforts to be wasted for nothing. Indeed, each participant willing to win the mining race enhances his or her calculating performance. This leads to the endless hashrate race. All hashing processes compensate each other, thus pushing participants to further improvements.
- PoW tends to centralization. As the hashrate increases, there are small members refusing to proceed with mining. Those who want to continue join mining pools. In this way, a significant hash rate appears to be concentrated under a single management.
- PoW substitutes consensus achievement for mining as a profitable activity. Mining is simply one of the ways to reach the overall agreement. But reward provision moved focus toward bounty.
These reasons provoked different alternative consensus approaches to appear. In order to prevent similar flaws of future solutions, there are attempts to tie mining to time intervals. This algorithm is called Proof of Elapsed Time.
Previous Approaches Recollection
Before describing PoET in more detail, let’s refresh some previously researched methods.
PoW is the most popular method used by simple blockchain-based projects. All Bitcoin descendants use PoW with minor variations. So do Ethereum and other early proposals.
Proof Of Stake
One of the first alternative algorithms is Proof-of-Stake. This method was developed for Ethereum final upgrade. It is based on the idea of locking one’s assets to gain the possibility of block mining. Resolving some of PoW disadvantages, it still has its own flaws.
This method was explained in the previous article. It depends on the memory space reserved by participants. It requires more trust than other algorithms, thus it is not really convenient for the trustless crypto environment.
This interesting proposal was introduced as an attempt to step aside from resources race. PoB uses assets destruction to prove the right for a new block proposal. It may even bring losses to participants if they are willing to mine transaction as soon as possible.
Proof Of Elapsed Time
As for PoET, the most crucial component here, defining who is the miner, is time. Time delays are set to be random with special software modules. As soon as time delay runs out, it is possible to propose a new block to the network. If someone already does it, a new delay will be recalculated and the process will go on.
There is only one famous project that uses this approach. It’s general name is Hyperledger. Inside, there are five separate solutions. One of them is called Sawtooth. This is the one that uses PoET.
The problem of trustworthiness arises here. Since all calculations are performed on a particular node, it is impossible to verify whether they are fair. To resolve this problem, the Hyperledger team uses Intel SGX software developed to protect code execution and results from intrusion.
The PoET is explained on its website as follows:
- Each validator queries for a time delay from a trusted party.
- The shortest time delay validator is considered to be a leader.
- The special “CreateTimer” function is responsible for the calculation of a block transaction timer.
- The special “CheckTimer” function is responsible for proving the leader time delay.
PoET is not the only case when time is used. Time delays after PoS calculations, which help prevent a participant from mining several blocks in row, are used in the Peercoin project.
We will talk about similar interesting implementations and other consensus methods in our next articles.