• user-img

    Priya J. in Blockchain Development

    14 Feb 01:17 AM


    Is Blockchain Sustainable?

    Blockchain is a decentralized ledger technology that records individual transactions in an immutable and secure way. A blockchain is maintained by independent entities, called nodes; a network of these nodes makes up the blockchain.
    The Consensus Mechanism is what is used to decide on the state of a blockchain. It has two aspects to it, Chain Selection and the part I’ll be focusing on, Sybil Resistance. Sybil Resistance is the ability of the blockchain to defend against malicious entities that try to gain an unfair influence over the system. As decisions in a blockchain are based on establishing a majority, 51% attacks are the most common types of Sybil attacks that are used to take control of a blockchain. 51% Attacks are characterized by entities taking control of over 50% of the nodes in a blockchain to establish a majority, this allows them to manipulate and influence transactions on the network. To combat these attacks there are two types of Sybil resistances that blockchains employ.
    The first is Proof of Work (PoW), where individuals compete against each other to find a solution to complex questions. People who dedicate time and energy to solving these problems are called 'miners', the first of these ‘miners’ to solve the question are allowed to add a new block to the chain and are rewarded for their efforts after being subjected to an audit. The high computing power needed to mine new blocks is what makes this mechanism secure, as malicious entities would need to dedicate the resources to control 51% of the computing power of the miners on the chain, to influence any transactions. Due to continuous and high energy needs of mining paired with the cost of hardware, a single entity would not be able to bear the costs of doing so. Proof of Stake (PoS) is the second Sybil Resistance that a blockchain can employ, where randomly chosen 'validators' put up a certain amount of collateral by buying the coin of the blockchain they wish to be a part of. Instead of the high energy consumption that mining uses to secure the blockchain, the security here is the fact that malicious entities must put up enough collateral to control 51% of the network, which is impossible due to the high costs associated with this.