Solana Blockchain - Crypto Academy / S4W4 - Homework post for pelon53/
I am glad to participate in your class this week professor @pelon53. I have tried to keep this assesment task as concise and straight to point as I could. Thanking you in advance for your good judgement.
Explain in detail the PoH of Solana.
What is proof of history.
Proof of history involves a sequence of cryptographic computation that tends to establish the difference in time between one occurrence (a transaction) in a Blockchain network from another using a high frequency Verifiable Delay Function.
What can be called proof of history and what differs it from other consensus algorithm is the approach Solana took to synchronize blocks. Take for instance, in proof of work consensus algorithm, transactions are bundled into blocks, for a transaction to be processed requires that certain duration known as "block time" is completed. This is done so as to restrain the possibility of multiple validators producing new valid blocks at the same time. Bitcoin for example sets it's block time to 10 minutes, other proof of work Blockchain may have varying block time. As observed, while this process makes the Blockchain secure, it lags and do not achieve transaction speed and scalability.
Proof of stake consensus algorithm on the other hand are not faced with same challenge as in the proof of work, there are no such set restrictions. Validating a block requires a realtime timestamp ( wall clock) attached to each block to determine the order of occurrence in the blockchain. The very problem with proof of stake is the difficult of the nodes to agree on time due to clock drifts and network latencies, these result to lagging which prohibits fast and scalable network.
Solana attempts to proffer a solution by taking a different approach. Instead of relying on real clock timestamp as in the proof of stake consensus algorithm, a cryptographic verifiable proof can be provided to establish an order of occurrence, proving that a transaction occured before or after the said proof. As illustrated by Solana teem in their blue paper, taking a photo of today's news headline gives proof that the article was written before the time the photo was taken. With such proof, a historical record can be created establishing order of occurrence of events.
The Solana proof of history uses a node known as the leader node and other nodes called the verifiers. The sequence uses a cryptographic hash which output are not predicted from the input ( sha-256); entries can be hashed and assigned a count which serves as a time stamp by the leader node. The time stamp gives proof that series of counts took place before the entry could be hashed. The output which is the entry hash will be the input of the next entry, the next entry input will be the hash output of the previous and so forth, thus forming a single immutable thread which is continuous. Each result will be streamed to the validator nodes which will confirm it's authenticity and the attached time stamp, to ensure that the leader node has given proof of history, then it is recorded.
entry sequence in solana proof of history. Image source
The time between when the leader node sends the hashed entries to the validator node and time the validation is completed by the validator nodes has no delay. The information are streamed to the validators and which are automatically validated or in the event of error, the process is rolled back. With this implementation, it is as if the verifications happens almost immediately.
The cryptographic function done by the leader node is achieved using 1 core graphics display unit and with the modern computers with up to 4000 gpu, it means data entries can be split and executed in parallel, 1 per core multiplied by number of cores. This ensures large chunk of entries processed simultaneously.
Given the above discription, Proof of history for Solana on it's own therefore is not actually a consensus mechanism but an implementation made to improve it's proof of stake consensus algorithm.
BENEFITS TO BLOCKCHAIN.
This processes ensure better security on the proof of stake consensus algorithm. The entries as seen becomes like formation of an immutable thread which will be difficult to attack because altering the flow of the sequence will disrupt the entire network. Secondly, it may be difficult for a hacker to create a replica since it may need to run the entry up to and over 256 times given the use of sha-256.
Another benefit is improved speed. With the mechanism put in place Blockchain now can have a true scalable network that can compete with centralised systems. Solana has been proven to perform up to 50000 transactions per second. Compared with other proof of stake consensus algorithm it has proven to have for the present an unbeaten speed.
The third benefit I will like to mention is lower transaction cost. The rising gas fees experienced in proof of work consensus like Ethereum is solved in Solana since faster throughput leads to lower transaction cost. In Solana the cost is set to 0.01%.
Just like Ethereum, Solana is an open source Blockchain that aims to house lots of Dapps and smart contract. Unlike it's predecessors the speed achieved is tremendous which is likely a threat to it's competitor Ethereum which can achieve 10 transaction per second. Solana seem to have solved the Ethereum problem of scalability, transaction speed and low transaction cost.
- Explain at least 2 cases of use of Solana.
The technology of Solana has resulted to serious boom in the ecosystem. Aside from the rise of the native token, many projects are underway in the Solana platform. Among these projects includes DEXs, staking platforms, games, entertainment, NFT market places, storage solutions and also Solana wallets and more.
1: Solana use case on entertainment field/media.
Most Blockchain effect in the entertainment sphere is to provide an enabling ground to allow content creators obtain the true benefits of their works without being hijacked by middlemen and the real owners receive stipends.
Another area is providing Anonymity for creators who do not wish to be know due to the sensitive info their content may convey. Among the projects in Solana which aims at this is "the media network".
** The media network**
This is an open source and decentralized media platform that aims to solve the issue of privacy and at the same time providing peer to peer media transamision to user's across the network.
The protocol allows for live streaming hosting. Anyone can participate and share or host content without need of kyc, the centralized traditional CDN is bypassed enabling peer to peer bandwidth market. Participants are rewarded according to their contributions with token minted on Solana network.
2: Financial savings.
Anchor protocol is a decentralize fixed income instrument. The platform is a place for staking yields, money markets etc
The platform improves on centralised money making organisations giving users a better platform to borrow with collateral, lend and stake in yield farms using ANC token built on Solana network.
The governance of the platform decide on the APY which is paid out to depositors, this is known as the "anchor rate" and this decision is achieved through majority vote by users voting to decide on the parameter of the anchor rate.
Borrowing requires a collateral which when injected in the platform also yields returns and therefore improving the Liquidity of the platform.
Detail and explain the SOLA token.
The sola token is an Erc-20 token and a native token for sola network.
It is ranked #1836 and it's price as at today 30th September 2021 is $0.057384
Trading with a Market Cap of $1,539,971, Sola has a total Supply of 27,153,077 with a circulating Supply of 27,153,077
Sola network is a decentralized social information platform built on Ethereum Blockchain. The platform might appear a bit similar to reddit since it's users do not need to connect socially to each other as in the case with Facebook, twitter and the rest, to receive feeds. Users can share information which is broadcasted across the network globally. The interesting part is the ability to monetize your content on the network and be paid in Sola token. Users can create share and monetize contents with no restrictions to national boundaries.
During it's ICO, Sola token was sold at at $ 0.0100. The initial coin offering was conducted starting November 27th 2017 and ended December 2nd same year. The ICO raised $2,233,700. Subsequently the coin was airdroped to user's.
***Bottom line ***
Sola token is not Solana token. Solana has a native token named sol which is the utility token of the platform. Sol current price is $140.42 and it is ranked #7 in coin ranking.
It's 24 hr volume is $2,264,615,764.62, although at 5.83% dip, the volume shows high liquidity.
The market cap is tagged at $41,851,816,335.20 and attaining 6.25% increase as at today.
When did Solana Blockchain see its operations interrupted? Why? Explain.
The Incident took place on September 14 2021. Solana mainet was interrupted and it halted. No operation like buying and selling of crypto, staking etc was functional. This down time was said to have lasted up to 17 hours. The network was back live the next day Wednesday September 15 2021.
One of the prominent known reason for the outage is that the network ran out of resources due to system overload. The blame was partly due to influx of transaction activities on a new social networking platform called Grape, the hike has generally led the Blockchain to have ran over 400,000 transaction per minute and because of shortage of ram ( random access memory) the system crashed.
Check the last block generated in Solana and make an approximate calculation of How many blocks per second have been generated in Solana, taking into account from the initial block to the current one? Justify your answer and show screenshots.
To do this exercise, I went to Solscan.io, I scrolled down to find the blocks.
The last block in the produced by Solana network as at the time of doing this task is block #99150735. See screen shot below
solscan image. Source
Number of blocks generated by Solana network per second ranges from 2 to 3 blocks. I took note of that by taking into consideration the elapsed time from the previous block time and the number created within a second.
solscan image. Source
In the image above, you may notice that after the creation of block #99150684 at 22:25:07
The next second 3 blocks were created at 22:25:08. I marked the area
A. The time that elapsed after the previous block the area I marked
B was 1 second and within 1 second three blocks were created.
I have taken earlier observations to confirm these claims. For instance, in the photo below, the marked areas identify differences in elapsed time in seconds and number of blocks produced before and after each second.
solscan image. Source
Solana Blockchain has proven to be the fastest Blockchain ever. This greatness of Solana is achieved due to its proof of history mechanism.
While proof of history is not a different consensus algorithm, it proffers a solution to the scalability of Blockchain and at the same time providing fast transaction at low cost in conjunction with proof of stake consensus algorithm.
Among The benefits includes enhanced security, low transaction cost, a truly decentralized and scalable solution and fast transaction speed performing up to 50000 transactions per second.
The crashing of the Solana network on September 14 proofs that even a good network sometimes can never be perfect. Even centralized Networks like Facebook has once in it's history experienced system interruption. However, the system is back and running.
Solana is an open Blockchain like Ethereum on which smart contracts and decentralized app can run successfully. Compared to Ethereum, it is faster and scalable and the use case has resulted to influx of operations of over 400 different dapps are presenting running on the platform.
The native token "sol" has therefore skyrocket to an all time high of over $200 and currently ranked #7 in the coin market cap. Sol token is experiencing a dip in the following days likely after the system interruption. However the network and it's coin looks promising at it seems to have attempted solving Blockchain long standing setback when compared to centralised finance.