Cardano's proof of participation protocol should lead to unprecedented decentralization, but the mechanisms that guide it remain a mystery to many. Cardano's chief scientific professor Aggelos Kiayias delved deeply into Ouroboros and detailed the principles on which the ambitious protocol is based.
The problem of building decentralized systems
Persistence and liveliness - these are the hallmarks of successful distributed registry systems, according to Professor Aggelos Kiayias, chief scientist at Cardano . However, it seems that systems based on the simplest premises are the most difficult to provide.
Kiayias delved deeply into the problems faced by decentralized systems and provided a detailed view of how Ouroboros de Cardano succeeded in solving these problems.
The perseverance and liveliness he mentioned are a promise of a coherent vision for all the participants in a system and a guarantee of reactivity to the continuous flow of events that result from their actions. This is fairly simple and easy to do in a centralized system, but gives the system a single point of failure and makes it vulnerable to attack.
Designing a robust decentralized system is a much more complex task, as they require the development of models that systematically encompass all of the different threats that the system might encounter and prove that persistence and alertness are maintained at all times.
Therefore, a well-designed decentralized system will continue to function even if some of its parts deviate from its proper functioning. The system must be designed so that it can handle even greater deviations in its operation without suffering too much damage.
A reliable decentralized system would combine formal guarantees against various types of failure and attack models, the most important and most important failure class being the Byzantine models.
Byzantine models guarantee that the system's persistence and liveliness will be maintained even if a large part of the network participants arbitrarily deviate from the network rules. The second, but equally important, class is that of rationality models, which assumes that all participants in the network are rational utility maximizers, which is why the properties of the system should flow from their pursuit of self-interest. .
Analyze Ouroboros through two types of behavior
According to Kiayias, what makes Ouroboros unique as a protocol is the fact that it combines various design elements that take into account both the Byzantine and rational behaviors described above.
Namely, Ouroboros uses participation as the main resource to identify the leverage that participants have in the system. In addition to being resistant to native proof of work protocols attacks, such as the 51% attack, staking makes Ouroboros more environmentally friendly because it requires a minimum of physical resources to operate.
Ouroboros also guarantees the dynamic availability that a proof of work system has never been able to - Kiayias said the protocol continues to work even if an arbitrarily high number of participants decide not to stake out and keep the ledger.
"Of the active participants, just over half must follow the protocol - the rest can be arbitrarily deviated," he wrote in the blog.
In fact, Ouroboros could even tolerate peaks above the 50% threshold as long as they don't last too long. This flexibility allows Ouroboros to be more resilient and adaptable than conventional Byzantine fault tolerance protocols and their model adaptations . These protocols must have a relatively certain prediction of the participation they expect from the network to operate - any deviation could easily stop them from working.
Another thing that sets Ouroboros apart from other PoS protocols is its lack of trust. Kiayias explained that the process of joining and participating in the protocol does not require the availability of a special shared resource such as a checkpoint. When committing to the protocol requires nothing more than the public genesis block of the chain and access to the network, it eliminates the point of failure which is a shared trusted resource.
But no matter how advanced these features are, it takes more than a well-designed network to attract users. This is something on which IOHK devoted a lot of time and effort when designing Shelley, the era of Cardano proof of participation . Knowing that a well-oiled machine is practically worthless without someone driving it, Cardano introduced a fairly advanced reward mechanism.
Although the payments for those who put their coins on the network are not new, Ouroboros has incorporated a reward sharing mechanism which has prompted network participants to organize themselves into operational nodes. These nodes, known as bet pools, provide quality of service regardless of how participation is distributed among the user population, said Kiayias:
“In this way, all stakeholders contribute to the functioning of the system - ensuring robustness and democratic representation - while the cost of maintaining the general ledger is effectively distributed among the user population.
However, encouraging the creation of organizations can inadvertently lead to centralization. This was not overlooked when designing Ouroboros, which includes its own set of countermeasures that discourage centralization. With tight control over bet pools, the protocol prevents a situation in which only a handful of operators would be responsible for maintaining the blockchain.
Ouroboros is not just about the eyes
While developments within Cardano seem to happen at lightning speed recently, in fact, work on the protocol have started in 2015 when the blockchain was announced for the first time. Scratching the surface reveals an almost incredible amount of research on Ouroboros, which Kiayias proudly describes in his article.
He noted that the design elements of Ouroboros should never be obvious to the average user of the protocol. Instead, they were delivered in peer-reviewed articles with meticulous documentation attached to them. All articles published on Cardano , of which there are over 50 so far, have been published in both conferences and publications in the field of cryptography and cybersecurity.
Each of these articles is explicit on the specific types of models used to analyze the protocol and presents the resulting results in concrete terms.
"Building an inclusive, equitable and resilient infrastructure for global financial and social applications is the big challenge for information technology today."
This is why Ouroboros is considered a revolutionary protocol in the industry - not only does it have unique characteristics accessible to all thanks to its open-source code, but also by presenting a design methodology that highlights the first principles, modeling and analysis.
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