17. What is Proof of Elapsed Time (PoET)?
This is nothing more than another of the consensus mechanisms. Its task is very simple. It is to prevent high resource utilization and energy consumption. It makes the whole extraction process more efficient, all by using a fair lottery system. How does the algorithm itself work from the inside? It uses randomly generated time that has already elapsed to determine mining rights and block winners on the blockchain network. I know, I know – sounds complicated 🙂 Relax – we explain everything in detail below. PoET increases transparency and provides the ability for external users to verify lottery results. All by running so-called trusted code in a secure environment.
PoET consensus mechanism
As you know from previous lessons, the consensus mechanism is used in blockchain networks to verify transactions and create more blocks. The Proof of Elapsed Time is used right here. It decides the mining rights or winners of blocks in the network.
PoET works by relying on two key factors. Participating nodes choose a random mining time, not the one chosen by the participant to win. Secondly, PoET determines that the block winner has successfully completed the waiting time.
The very concept of the mechanism was invented in 2016 by Intel Corporation. It was a giant in the field of chip manufacturing. Intel has so far offered ready-made, high-tech tools for solving computational problems such as “random leader election.” Such a mechanism allows applications to generate so-called trusted code in a selected environment that meets two key requirements:
∙ Random selection of waiting time for all node participants.
∙ Actual completion of the waiting time by the winning participant. Moreover – the time is equal.
The INTEL organization in collaboration with Linux or IBM sponsored the open source project Hyperledger Sawtooth, which also uses the PoET mechanism. Hyperledger Sawtooth is a distributed ledger that scales solutions as well as being adaptable to multiple applications at different enterprise levels. It can be found in supply chain or logistics. And it can even be used for inventory management. It is also often used in tasks that consume a lot of time and are prone to human error. Why are we mentioning this? Because the PoET consensus is just mainly used in Hyperledger Sawtooth. As of January 2022, no cryptocurrency based on this consensus has been created.
PoET – how it works
As we mentioned earlier, the whole mechanism is based on the principle of a fair lottery system. In it, each node has the same probability of being chosen, and the chances of winning are spread over as many network participants as possible. Under PoET, each node in the network waits for a randomly selected period. The node that
completes the designated waiting time first will win a new block. This whole process repeats and more blocks are discovered in this way.
PoET vs PoW
|Uses less energy than PoW.||It is a competitive working mechanism.|
|Improves network performance by putting a node to sleep and redirecting it to other tasks.||Continuously computes hashes until miners find target values.|
|The trusted code cannot be changed by another participant.||Relies on leaders.|
|Provides a way for network participants or other authorized people to verify the results.||PoW is difficult to generate and is therefore time and resource consuming.|
|Increases transparency of network consensus.||Accounts for as much as 90% of the total market capitalisation of existing cryptocurrencies.|
|Controls the cost of the consensus process and keeps it constant.||Requires work from nodes that participate in block validation.|
|Is a random selection mechanism.|
∙ PoET is a consensus algorithm that was developed by Intel Corporation. It is the one in the blockchain network that randomly permits who will create the next block.
∙ It works on the basis of the lottery principle. The chance of winning is distributed equally to all participants in the network and everyone has the same chance of winning.
∙ It generates a random wait time for each node in the blockchain network. The other nodes on the blockchain are dormant and are then engaged in other work.
∙ The node with the shortest wait time wins the block and can save it to the blockchain.
∙ The workflow in PoET is very similar to Bitcoin’s PoW, but uses far less energy.
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