DEXON is an innovative blockchain technology that focuses on real-world adoption for building decentralized applications (DApps). Since publicly announcing its plans to build the blockchain platform, DEXON demonstrated strong performance traction, such as hitting 12,000 transactions per second (TPS) with fast finality of 1 second on their testnet. Besides that, DEXON’s mainnet went live on the 25th of April, 2019.
DEXON wants to prove that it’s possible to solve the trilemma of blockchain issues which consists of:
1/ Slow transaction finality
2/ Miner centralization
3/ Low throughput
Slow Transaction Finality
One of the hot debates today is about finality in blockchain consensus. Many projects have been experimenting with clever mechanisms and protocols to find the ideal balance between speed and security. The most important property is finality which can be described as the confirmation that all well-formed blocks will not be revoked once agreed on and committed to the blockchain.
To dig deeper, we can distinguish two types of finality;
Probabilistic finality refers to the finality provided by chain-based protocols like Bitcoin’s consensus in which the probability that a transaction will not be reverted increases every time new blocks are being added to the chain.
The more blocks have been appended on top of the block containing your transaction, the more likely that the fork containing that block is the longest chain. Because of this probabilistic finality property of Bitcoin’s chain, there is an implicit rule to wait at least for 6 blocks to be added on top of your block (~1 hour) in order to ensure that there is a very low likelihood of your transaction being reverted.
Absolute finality refers to the type of finality that is often implemented by Byzantine Fault Tolerant protocols (e.g. Tendermint), which is also used by DEXON. Absolute finality simply means that a block has reached finality once it is included in the chain. DEXON also understands this needs for finality as companies building on top of blockchain technology rely on quick finality.
Actually, we can find a third form of finality called economic finality, in which it becomes monetarily costly for a block to be reverted. The most well-known mechanism is slashing (for Proof of Stake) which means that a malicious user gets punished for not acting honestly. The slashing refers to the staker losing half of its staked tokens (e.g. Capser FFG, Tendermint).
Solving Miner Centralization
Fair Cryptographic Sortition to solve Decentralization
DEXON users can use the native DXN coin to get validator rights in the network. This means that they have the chance to be delegated to verify a set of blocks as every hour, a small set of random validators is selected between the token holders.
Unlike other Proof of Stake mechanisms, it doesn’t matter how much DXN coins you hold. Everyone gets a fair chance of being selected. Therefore, DEXON is able to prevent the network from falling into a minority-controlled network.
Solving Low Throughput
Responsive Byzantine Agreement to solve Scalability
DEXON has found a clever way around the issue of slow block finality. It introduces unpredictable randomness to prevent malicious nodes from proposing incorrect blocks as nobody is able to predict this random beacon. Because of this unpredictable property, there is no need for slow verification mechanisms or time-consuming fork-choice rules.
In a nutshell, the randomness beacon can be described as (source: more info DEXON randomness):
- For each block, there is a unique random beacon, which is accessible for smart contracts.
- The random beacon is unpredictable for anyone before the block is confirmed.
- Even the block proposer cannot predict or bias the beacon of that block.
- Every user can verify the validity of the beacon, hence, it is called verifiable.
This means that the validators interact with each other as soon as the messages arrive so that the block confirmation time only depends on the actual network delay instead of any predetermined time bound.
The Bottom Line
DEXON is certainly a project to follow as they are introducing interesting innovation into the blockchain space, especially the experiments they undertook with the BFT consensus algorithm. Also, DEXON has planned the launch of the SQL-VM in Q4 which gives developers access to write smart contracts with SQL92 compatible language.
Block finality is one of the most important properties for reliability and mass adoption by real-world businesses.