What is Proof Of Time and How Does it Work?
Disclaimer: The Industry Talk section features insights by crypto industry players and is not a part of the editorial content of Cryptonews.com.
Proof-of-Time (PoT) is a decentralized consensus algorithm that works by selecting validators in proportion to their ranking scores and fixed stake. A ranking score is a numerical weighting measure that the algorithm assigns to each validator based on its historical experience (the accuracy with which the node validates event data) and other validators’ experience with the node.
On the other hand, a fixed stake is a staking mechanism where all the validators stake an equal amount of $ANLOG tokens—the platform’s native asset—to participate in the consensus process. Unlike typical proof-of-stake (PoS), where nodes must stake large amounts of tokens to be considered for consensus, the PoT mechanism is fair. Any node can participate as a validator provided it has staked a fixed amount of $ANLOG tokens and accumulated a ranking score.
The PoT mechanism is a two-step process involving soft and hard voting at its core. During the soft voting stage, a selected time elector (validator) proposes a block to be included on the Timechain—the Analog’s event-based ledger. While all the online time nodes can submit block proposals, only one time elector gets selected through a randomized process that incorporates a verifiable delay function (VDF) based on its ranking score and fixed stake.
For each consensus round—also called slot—each time node determines whether it has been selected as a proposer or not by running a VDF process. If selected, the time elector collates the posted event data, verifies the publisher’s signature, and generates the VDF proofs. It then broadcasts the hashed transaction alongside a VDF proof to the rest of the time nodes in the network.
This process triggers the hard voting phase, where a committee of 1,000 time nodes—also selected via VDF— determines whether the transaction is valid. Each of the 1,000 time nodes checks for VDF proofs, double-spending, and other issues with the proposed block. If the proposed block is valid, the time nodes attest to it by accepting it.
If more than two-thirds of the 1,000 time nodes (667 time nodes attest to the transactions), the block gets appended to the Timechain.
Why Is Proof-of-Time Important? (PoT)
The decentralized consensus-building accomplished by the use of different consensus methods such as proof-of-work (PoW), PoS, o delegated proof-of-stake (DPoS) is an intriguing feature of Blockchain. These consensus mechanisms are designed to ensure that participants have identical copies of the distributed database files. The issue now is, why do you need PoT as a consensus mechanism?
Decentralized consensus is the single most attribute that any Blockchain should have. It allows the network to be transparent and immutable. In a decentralized consensus, all nodes should have fair (equal) opportunities when it comes to updating the ledger. There shouldn’t be any barrier to participation in the consensus processes.
While you could argue that PoW allows any node to participate as a miner, it is restrictive in the sense that nodes have to expend a lot of computational resources, which ends up disenfranchising smaller players. As such, barriers to entry remain high on PoW-enabled chains.
PoS, on the other hand, is certainly more advanced than PoW-enabled chains in terms of speed of transactions and scalability. However, it doesn’t address the trilemma challenge well, especially when it comes to security and decentralization, because it centralizes the network by allowing only a few nodes (big spenders) to participate in the consensus process.
Because of the aforementioned issues, Analog has built PoT consensus from the ground up. Unlike PoW, where block generation relies on expensive hardware, PoT leverages ranking scores and fixed stakes. As such, any user with a fixed stake and accumulated a ranking score can propose and confirm blocks on the network.
The PoT protocol also never forks, unlike PoW, which is characterized by the longest chain rule with probabilistic finality times. Most importantly, the PoT’s randomized processes like VDF computations—where users self-select themselves—are transparent and ensure that all users have an equal chance of participating in the consensus.
Conclusion
Over the last couple of years, the Blockchain sector has made tremendous strides and gained traction. We can only compare these strides to that of the internet. However, before the technology goes mainstream, issues such as interoperability and scalability that are bedeviling the sector must be tackled.
Analog believes that these issues can be resolved through a completely decentralized consensus protocol with no barriers to entry. Instead of validators expending computational power or staking large sums of tokens to propose and confirm blocks, the PoT process has no barriers to entry. This means any node can join and participate as a time elector or time node.
When used alongside threshold cryptography, the PoT consensus provides a completely trustless and secure omnichain communication.
