Consensus mechanisms are used to validate the transactions on a blockchain. This allows the transactions to be executed in a decentralised ecosystem while the validator network ensures an acceptable level of security for the network.
What is Proof of Work? and What is Proof of Stake? are two of the most popular consensus mechanisms. The former is used by Bitcoin, Ethereum, and other networks while the latter by Cardano, Avalanche, etc
Proof of history is an evolved version of Proof of stake, but with some nuances. Let’s dive into it!
About Proof of History and its Working
Proof of History is an evolved version of Proof of Stake. A Solana native mechanism, proof of history works on validating a transaction based on previous historical events. It employs the Verifiable Delay Function, which calculates the time based on historical occurrences. After analyzing these occurrences, a hash function is constructed that can be confirmed by anybody. Every block created by the network has this hash appended to it.
Only a single CPU core can solve a VDF by performing a certain set of consecutive steps. Because no parallel processing is permitted, it is simple to determine how long each step will take.
Proof of History (PoH) overcomes the time barrier, making blockchain lighter and quicker by reducing the processing weight. Solana combines Proof of History (PoH)
with Tower Byzantine Fault Tolerance (Tower BFT), a security system that allows users to stake tokens to vote on the validity of a PoH hash.
List of networks: So far, Solana is the only major blockchain using this consensus mechanism
Advantages of Proof of History
- Using Proof of History on the network allows a reduction in network fees to a great. This is the reason why Solana offers low transaction fees as compared to other similar networks.
- As its an adapted and modified version of PoS, this mechanism also promotes scalability. As a result, more and more transactions are processed and attract a lot of developers.
- Under this mechanism, a clear, verifiable sequence of transactions that a validator adds to a block is created, without the need for a conventional timestamp.
Disadvantages of Proof of History
- As this method is only available on the Solana blockchain, it hasn’t been ever tested on the large scale. Hence several developers and critics question its usage and scalability.
- In past, a lot of attacks have taken place on the network and some are majorly due to the mechanism. Hence, critics doubt its security as well.
- For a person to be included as a validator on the network, certain pre-set conditions are to be fulfilled which aren’t negotiable.