Complete Guide to Understanding Proof-of-history And How it Functions

The Importance of Proof-of-history

Anatoly Yakovenko, Solana’s founder, devised a solution to the ‘clock issue’ by unveiling a cryptographic solution that offers a historical transaction record. By offering each transaction a verifiable timestamp, Solana can develop a cryptographic order of events without needing constant network consensus on the time and order.

The proof-of-history is the solution has become a vital feature that makes Solana unique. It allows it to attain high speeds without affecting decentralization.

Blockchains such as Ethereum and Bitcoin depend solely on consensus mechanisms such as proof-of-stake (PoS) and proof-of-work (PoW), respectively. However, Solana combines PoS and PoH to ensure high throughput and low latency. 

The special combination permits Solana to handle numerous transactions per second, addressing considerable bottlenecks encountered by other chains. 

How Proof-of-history (PoH) Functions 

The process utilizes a verifiable delay function (VDF) to develop a continuous  series of hashes. Every hash references the earlier one, creating a special timeline. 

PoH’s uniqueness is based on the idea that every hash is verifiable and relies on the previous one. The chain of hashes creates a ‘clock’ that all notes in the network can follow, permitting them to agree on the order of transactions without direct communication. 

Nodes can later validate blocks and transactions in a pre-ordered sequence, hastening the entire process.

How PoH Hastens Consensus on Solana 

In traditional PoW or PoS systems, blocks are created via a network-wide voting process. The process needs consensus on every block’s timestamp and ordering.

PoH permits Solana avoids such a situation through pre-ordering transactions to allow validators to process transactions as they emerge without the network-wide agreement. This minimizes communication and boosts the validation process’s efficacy and speed.

PoH can enable Solana to attain consensus quickly since each node has access to the same verifiable timeline. This facilitates predictable and rapid block times. 

Addressing the synchronization problems enables Solana to process numerous transactions per second with high consistency.

Interaction Between PoH and PoS

PoH and PoS function together seamlessly in the following way:

• PoH offers the ordered list of events, while PoS determines who should add them to the blockchain.
• The elected validator (‘leader’) gathers and orders transactions in line with PoH’s timestamps. The synergy between PoS and PoH allows Solana to retain security and speed, a balance that has been difficult to attain in other blockchains.

Lead Validator’s Role in Block Creation in Solana 

The leader can leverage PoH to place every transaction in a particular order. This eradicates the need for other validators to validate the sequence of transactions actively.

After the validator creates the block, other nodes verify it. Because every block already adheres to the PoH timeline, verification is faster and more efficient.

The thematic flow of consensus that combines PoH and PoS is shown below:

Step 1: Validator leaders on Solana are selected based on a stake-weighted system.

Step 2: The PoH consensus mechanism yields a rotation schedule for the leaders with each accorded a slot. 

Step 3: The leader gathers transactions from the network. Using a special cryptographic signature, the leader timestamps each transaction.

Step 4: The leader classifies the transactions into a block by embedding a timestamp relative to the PoH pattern.

Step 5: After the block’s creation, the leader broadcasts it to the rest of the network.

Step 6: Other validators receive the block and validate it against the PoH sequence.

Step 7: Following validation, the block integration into the blockchain occurs to finalize the transaction records. 

Additional Innovations on Solana 

Turbine addresses the data propagation problem in large networks by breaking down data into smaller pieces and transmitting it across nodes in parallel. Solan’s pipelining architecture allows various stages of transaction processing to run concurrently. 

Why Solana Lacks a Memepool

In Solana’s system timestamping transactions occur as they enter the network. This allows real-time processing that eradicates the need for a meme pool. 

Block Leaders

Since leaders are responsible for organizing and ordering transactions, they are critical in the network. Further, because block leaders are responsible for order transactions, they can manage extra earnings via the maximum extractable value (MEV) transactions.