Blockchain consensuses and incentives

Meijun Li, Gaoyang Liu, Jialin Tian, Chen Wang, Yang Yang, Shaohua Wan

Abstract: As the core of a blockchain system, the consensus mechanism not only helps to maintain the consistency of nodes' data but also gets involved in issuance of tokens and prevention of attacks. Since the first blockchain system was born in 2009, it has been continuously improved with the development of the blockchain technology and evolved into multiple new branches. Starting with the basic introduction of the consensus and the classic Byzantine Generals Problem in distributed computing area, this chapter proposes a thorough classification of current consensus protocols in blockchain system, enumerates the characteristics of mainstream protocols (proof-of-work (PoW), proof-of-stake (PoS), delegated PoS (DPoS), practical Byzantine fault tolerance (PBFT), etc.) and analyzes the strengths and weaknesses of them. Then we compare the performances of them from the number of nodes to the degree of scalability and other aspects. In the end, we introduce the incentive mechanism in the design of a consensus and summarize the future directions of developing more practical consensus schemes.