Proof of History (PoH) is the consensus mechanism used by the Solana (SOL) blockchain. The developers behind Solana invented this mechanism themselves, just like many other techniques used by this blockchain.

This algorithm can be compared to Proof of Stake (PoS), because it is based on it. However, there are some major differences between these two mechanisms. This difference is mainly in the way in which both mechanisms determine the time of an event. You might have guessed that from the name of this algorithm.

In this article we explain what Proof of History is, how it works and which blockchains use this consensus mechanism.

View quickly

 

• View quickly
• What problem did Proof of History arise from?
  • Media timestamp
• What is Proof of History (PoH) and how does it work?
  • Verifiable Delay Function
• Which blockchains use Proof of History?
• The Pros and Cons of Proof of History
  • Advantages
  • Cons
• The difference between Proof of History and Proof of Stake
• Conclusion

In the video below, from AllesOverCrypto itself, we tell you more about what Solana is.

 

What problem did Proof of History arise from?

One of the biggest problems blockchains experience is that the blockchain’s network has to agree on the date and time of an event . That may sound strange, because each block is of course given a timestamp , which determines the date and time of creation. Yet we see that this problem is bigger than you might think.

It is also sometimes said that the main function of Proof of Work is to serve as a decentralized clock. After all, everyone in the network will have to agree that something happened on a certain date and time, which is quite difficult if a network consists of tens of thousands of miners.

The video below explains in a few minutes what a timestamp is. If this is not yet clear to you, it is recommended to watch this video.

 

Other decentralized systems have solved this problem through a central time system. For example, Google uses a central clock for all its data centers in the world. This clock is very well maintained by Google developers. It should not happen that even one server is one millisecond ahead or behind. This would have disastrous consequences for the data centers.

The problem just described is even bigger for blockchains. A node cannot simply rely on the time provided by an external source . This is because a node is certain whether this time is actually correct. After all, it may happen that this external source has been hacked, resulting in the wrong time being supplied.

This is a common problem within blockchain technology. It is always difficult to ensure that information that is supplied is correct. There is no person in the game who can check this, because the blockchain works completely decentralized. This means that the blockchain itself must ensure that the information it receives can verify before it can be considered the truth. Fortunately, there are more and more projects that try to develop a solution to this problem, such as Chainlink (LINK).

Media timestamp

Hashgraph solved this problem with a median timestamp . This solution means that all data in the network is provided with a signature of the node, after which a super-node provides the timestamp. Data can only be added to the blockchain once the super-node has timestamped the data. After this, the data can only be forwarded to the rest of the network, which will then store it.

How Hashgraph solved this might sound like a smart idea. However, there is a major drawback. This way of working is extremely slow and ensures that it takes a long time for a transaction to be processed by the Hashgraph network. That’s why the team behind Solana thought that the ‘median timestamp’ wouldn’t be for Solana. After all, the blockchain had to be able to process transactions quickly.

What is Proof of History (PoH) and how does it work?

Proof of History is the consensus algorithm devised by the developers of Solana (SOL), and is only used by this blockchain to date. It arose from the problem described above.

Proof of History ensures that time is saved by placing certain events in a sequence. Imagine taking a picture of De Telegraaf that fell on the doormat today. This photo is proof that the photo was taken after this version was published. After all, it is impossible to take a picture of this newspaper when it has not actually been published yet.

Or what if you’re at a football game and you take a picture. This photo is proof that the photo was taken during the football game. It is impossible to take a picture of the same football match before or after, because it has not yet started or has not yet ended.

This is how Proof of History works. However, with this consensus mechanism, no photos are taken of events. Instead, a particular hash is used . This hash is based on previous events, making it impossible that the hash was developed before or after this event.

Verifiable Delay Function

Proof of History is basically a Verifiable Delay Function, which is not a new concept in the IT world . Let’s take a closer look at what a Verifiable Delay Function is so that we can eventually understand how Proof of History actually works.

A Verifiable Delay Function needs a certain number of numbers and events that have happened before. Based on this, an output is created by means of the SHA256 hashing algorithm. This output is public and can be verified by anyone. This allows an entire network of nodes to check whether the outcome of the Verifiable Delay Function is correct, and whether a node is performing its work correctly.

Solana’s blockchain can process more than 60,000 transactions per second. This is a very large number, especially when compared to Ethereum, which can process less than 20 transactions per second. That is why Solana is also called an Ethereum killer by many people.

The high scalability of Solana is mainly due to the Proof of History mechanism, but of course also to the other techniques and protocols developed by the team behind Solana. For example, think of Sealevel and Turbine.

In the video below, Solana herself explains more about the Proof of History consensus mechanism.

 

Which blockchains use Proof of History?

To date, only Solana’s blockchain uses the Proof of History consensus mechanism . They are also the ones who invented this mechanism, because they saw that recognizing time in other systems was not smooth.

The larger a blockchain network is, the more difficult the network has to determine time. A large network will then have to communicate continuously with each other to be sure about the time. This of course takes a lot of time, making the network slow.

This was not an option for Solana’s developers, because their blockchain would have to be able to process transactions at lightning speed.

The Pros and Cons of Proof of History

Below you can see the main advantages and disadvantages of the Proof of History consensus mechanism.

Advantages

• Proof of History makes it take less time to determine the time within an entire blockchain network than other systems, as is the case with Hashgraph;
• Proof of History is a lot more sustainable than an algorithm like Proof of Work (PoW), because it does not use miners, but validators;
• Proof of History is an incredibly scalable mechanism that can process large numbers of transactions very quickly. In addition, users pay low transaction costs, because the network is very scalable;
• You do not need to have special mining equipment to participate in the Proof of History network, because the network uses validators.

Cons

• In 2021, Solana has been the target of a hack several times. According to Solana’s CIO, Justin Bons, these attacks were due to vulnerabilities in the Proof of History protocol. This indicates that the Proof of History mechanism has not yet been tested on a large enough scale to be considered safe;
• As mentioned above, Proof of History has not yet been tested on a large scale. This not only means that we do not yet know enough about safety, but also that it is uncertain whether this mechanism will work on a large scale;
• There are currently fewer than 1200 validators active within Solana’s network, which raises the question of whether this consensus mechanism is really that decentralized.

 

The difference between Proof of History and Proof of Stake

Proof of History is very similar to Proof of Stake. This is because Proof of History evolved from Proof of Stake . The basis of both algorithms is the same. Both algorithms use validators that ensure the validation of transactions and the creation of new blocks.

However, the major difference between these two algorithms is the way the time is determined. Proof of Stake uses the timestamp function . This means that each node uses the timestamp that is passed through the network. This causes the network to run slower, as time has to pass through the network first.

This is not necessary with Proof of History, because it uses the Verifiable Delay Function, which determines the time based on events in history . These events are analyzed, after which a hash function is created that can be verified by anyone. This hash is added to every block produced by the network. It takes virtually no time to determine the time in this way, which makes Solana’s blockchain incredibly scalable at the moment.

In the video below I explain what Proof of Stake is and how this consensus algorithm works.

 

Conclusion

Proof of History is a consensus mechanism based on Proof of Stake, but modified the way of determining time . Time is now determined based on events in history. These events are converted into a hash, which can only arise from what happened before. It is impossible to forge the hash.

Solana is the only blockchain that uses Proof of History . They experience several benefits from Proof of History. For example, the blockchain is incredibly scalable and can process up to 60,000 transactions per second. PoH ensures that it takes less time to determine the time of a transaction.

However , there are also a number of drawbacks to Proof of History . For example, this mechanism has never been tested on a large scale, and we do not know whether it still works so well in that case. In addition, several vulnerabilities and hacks have been found in Solana in the past, which were partly caused by Proof of History. We are therefore not yet entirely sure whether Proof of History is a safe consensus mechanism. We’ll have to give it more time to find out,

Do you want to know more about Proof of History, or another consensus algorithm, after reading this article? Then ask your questions in our AllesOverCrypto Facebook group and our experts will answer all your questions.

Do you have other crypto related questions? The easiest way is to look up your question in our FAQ. What you can also do is that you google your question + “AllesOverCrypto”. You’ll soon be taken to one of our other articles dealing with that topic, so you can quickly learn more about that topic.

Header image by Banu Sevim