ELROND NETWORK- A scalable value transfer protocol for the digital economy
WHAT IS ELROND ?
Elrond is a complete rethinking of public blockchain architecture, especially designed to bring a major overall improvement by being scalable, efficient, and secure while maintaining a sufficiently decentralized setting. To achieve this the team introduce a novel Adaptive State Sharding mechanism, enabling scalability as more nodes join the network by parallizing transaction processing. On a consensus level Elrond proposes a novel mechanism called Secure Proof of Stake, introducing a random selection of the consensus group, stake plus rating as a fitness function for sybil attack prevention, and near-instant finality based on pBFT. To enable decentralized applications, Elrond is designed so that it is EVM and Ewasm compliant, supporting multiple smart contract languages and formal verification. Elrond steps up the scalability and interoperability game and proposes two new major assets to the blockchain. The scope is to create a novel blockchain architecture which goes beyond state-of-the-art and is designed for practical scalability via Adaptive State Sharding and Secure Proof of Stake (SPoS). In an ecosystem that strives for interconnectivity, their solution for smart contracts offers an EVM compliant engine to ensure interoperability by design, thus ensuring that Elrond Network will be relevant in an ever growing blockchains environment. Elrond is not a token that is backed by an asset or a service. Instead it is designed as a wholistic blockchain platform such as Ethereum. It offers smart contract execution and comes with the Elrond Virtual machine.
Elrond uses the Secure Proof of Stake consensus mechanism, its own variation of the Proof of Stake consensus mechanism. Proof of Stake requires that the node that proposes the next block is selected by a combination of stack, randomness and coin age. Stack is based on the number of coins held by an account. Coin age is derived from the number of days a coin has been held. Randomness is achieved by using different mathematical formulas and taking into account variables such as hash value. Some sort of Proof of Stake consensus mechanism is used by Cardano, EOS and Neo among many other cryptocurrencies and will be used by Ethereum in the near future. Proof of Stake is a consensus mechanism that is designed to secure the blockchain network without consuming high computational resources as it is the case with the Proof of Work consensus mechanism. Proof of Work is currently used by Bitcoin and Ethereum and can process only few transactions per second.
BLOCKCHAIN & NETWORK DATA
The blockchain has low system requirements and can run on anything from an ordinary computer to T2 medium AWS machines. The blockchain features epochs of ~24 hours and rounds of ~5 seconds.
All the validators in Elrond’s network will be split among multiple shards, where they will only have to synchronize the state for the current shards and process transactions only for their current shard. In order to prevent collusion amongst validators, up to ⅓ of the validators in a shard will be reshuffled to other shards at the end of every epoch. Liveness is not affected by this because the fast state synchronization for the newly reshuffled validators needs to synchronize only the state for the current epoch (~24 hours timeframe), while the remaining ⅔ of the unshuffled validators in the shard can still process transactions.
Each shard will consist of 400-600 validators and have a separate chain, accounts and application state. The consensus group (currently set to be n=63) changes every round based on a randomness seed stored in the previous block’s header. These validators in the consensus group need to agree on the proposed block in every round of every epoch.
Based on the randomness source in the previous block, n validators are chosen using a deterministic function. Every other validator in the shard can compute the n validators and verify the correctness of this nomination. The first selected validator will be the block proposer for the current round.
The block proposer signs the previous randomness source with a BLS single signature to generate the next randomness source, creates a block with transactions, adds the new randomness source in the block header and broadcasts this block to consensus group members.
Each member validates the block, also validating that the new randomness source is a signature verifiable with the leader’s public key on the old randomness source. If both are valid, it creates a BLS signature on the proposed block and sends this back to the leader.
The block proposer selects from among all received signatures, creating a subset of at least ⅔*n + 1 signatures, and creates a bitmap for his selection, where B[i]=1 if the ith member of consensus group was selected and B[i]=0 otherwise. The proposer then aggregates the signatures and attaches the bitmap and signature to the block. It must also sign the end result to "seal" the configuration for (B[ ], aggSig) before propagating the resulted block through gossip inside the shard.
CONTRIBUTION FOR THE BLOCKCHAIN ECONOMY
The team behind Elrond proposes a fast, secure, and highly scalable blockchain network that will be able to process a number of 10,000 tps per second and support a large number of dApps. While there is a large amount of competition in this space, all aiming for high throughput networks, an estimated 10,000 dApps will be in operation by 2020 and the blockchain industry will only move forward to mass adoption. Elrond’s proposition can add considerable value to the blockchain infrastructure space, by utilizing novel protocols and consensus mechanisms, and pushing the limits of Proof of Stake and Sharding. This coupled with the fact that one of Elrond’s focus is on the cross-chain interoperability puts the project in a position to become a leading force in blockchain development.
SIZE OF POTENTIALl MARKET
Elrond is looking to be a major player in a so called “big league” of blockchain development which is the high throughput, sharding, and cross-chain interoperability sector. The need for a high throughput and low cost of data storage is at an all-time high. The project that will solve these issues and provide an open and easily interoperable chain will be one that will see massive adoption, therefore there is room for multiple possibilities.
https://elrond.com/
https://elrond.com/files/Elrond_Whitepaper_EN.pdf
https://medium.com/elrondnetwork
Created by :
Elrond Community Username : Susukugede