Technical

In Part 1 of this paper we laid the foundations for Proof of Fee. Some of the ideas expressed there may be different from what you have seen elsewhere, and we do urge you to read that before you begin here. In Part 2 of this paper, below, we get into the mechanics and implementation details of Proof-of-Fee (PoF).

From empirical evidence over the last five years, we have seen few malicious attacks by validators; clearly something is working. We don’t want to break something that is working. What we want to evaluate is whether we can make it sustainably work at a lower cost.…

The Cost of Consensus

TL;DR

As an alternative to the (near-universally deployed) Delegated Proof of Stake (DPoS), we propose Proof of Fee (PoF), a sybil resistance technique designed natively and with consideration of the benefits and tradeoffs of PBFT consensus from empirical experience.

• Profits to blockchains are slim to non-existent. Low consensus costs are foundational for any chain that wishes to provide consumer surplus and profit to coin-holders; where excess winnings of the chain can be distributed to all account holders without preference to an investor class of “stakers”.
• In PoF the cost of consensus is lowered maximally to the operator opportunity cost; with such an approach, the social cost of dilution through issuance is minimized.