It’s not about PoW/PoS: The Two Main Families of Consensus Models

Oded Noam
Oded Noam

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3 years ago

blog

When I’m discussing blockchain technology with people, I too often hear people ask, “Is it proof-of-stake or is it proof-of-work?” And in 99% of the times, the answer would be “neither.”

The thing is, the PoW/PoS debate has been going on for so long, people have formed a strong opinion on each of these models and tend to think if they classify any new model as one of them, they will already have an opinion about it.

Yet, we do hear about a lot of new models all the time. Life is more complicated.

PoW and PoS represent of the larger family of “eventual” or “slow” consensus models. And, as its name implies, this family accounts for only half the picture — with a broad range of “fast” or “final” models in the other half.

Eventual consensus has its merits. It is, to date, the only mature method of permissionless consensus. In the utopian world of blockchain, permissionlessness is sometimes considered the only way to ensure safety from abuse of power. I do not think it is the only way, but I agree that permissionless models are a more sustainable way to create free and open networks. But it comes at a cost: these models are inherently slow, complicated and inefficient. And in the context of consumer apps, the ability of anyone to have their own software code participate in running the system doesn’t carry a lot of essence, because mainstream consumers simply won’t.

Today, Final consensus models are more practical for real use-cases of blockchain technology, particularly in mass-market applications. They are fast, and they enable simpler systems architecture which in turn enables better scaling, better security and more features. Many of these models are actually older and more widely used than eventual consensus models, as they are common in distributed databases, storage systems, supercomputers and other technologies that have become ubiquitous in the past 30 years.

And, of course, each of these families contains a wide variety of protocols, each with its own advantages and disadvantages, each appropriate to some use-cases and inappropriate to others.

In the Orbs position paper, we let our readers be a fly on the wall in our internal debate that led us to design the Helix consensus algorithm as a protocol for public and open consensus by a federation of consumer application developers. Choosing a protocol for eventual consensus is simply impractical in this context. And now, when asked if we’re PoS or PoW, we can proudly say: “neither.”

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