Although algorithms exist for establishing simple consensus, none allows machines to self-configure and negotiate parameters with each other independently of human intervention because of the current lack of support for negotiated consensus and the unacceptably low transaction throughput that exists. Railz however present a novel consensus algorithm that delivers negotiated Nash equilibria with minimal game turns, along with a protocol for securely encoding bundled transactions to achieve effective throughputs that are many orders of magnitude greater than those currently being achieved.
The result of this is a high throughput negotiated consensus algorithm that is suitable for industrial machine-to-machine price and parameter negotiating applications. A solution presented in the context of the Railz Protocol.
With Railz, negotiations between parties can be broken down into parameter (i.e. each party exchange parameters between each other). With this, a payoff matrix will be created and assigned for the two parties based on the parameters which roughly translate as a transaction. This could be as simple as buying and selling or even more complex activities that require negotiation and consensus. For example an individual may say I want to purchase an item from Amazon and if I’m able to get it today, I’m willing to pay $10. Otherwise, I’ll pay the normal price of $2 if I’ll have to wait for the normal delivery date. In a situation like this, Railz set payment matrix for this protocol such as:
$10 if I get the item today — — — — — — — — — — — — — — — — — — — — — — — — Matrix 1
$2 if I’ll get the item some other time — — — — — — — — — — — — — — — — — Matrix 2
Then the parties agree to a consensus and the transaction is carried out successfully without human interference.
A very important concern is if either party in the transaction cheats. However, due to the forethought of Railz, our innovation is set to exploit the capability of blockchain to encrypt data such that each party in the transaction will set it payment matrix and encrypt it with their private keys and then exchange it in the course of the transaction. Then they can be able to decrypt the information in the matrix and know the position of each other.
After this is done, Railz protocol help to encode these matrices; define them and analyze them using some set of mathematical and statistical predictions which then help to translate and show how this works in real life situations. By using the encryption and exchange of payoff matrix, both parties can be confident that they have reached a mutual conclusion.
Our goal is to design a blockchain-based system capable of being populated entirely by machines governed by and governed by algorithms such that they can easily and quickly negotiate between themselves to reach optimal consensus.
For more on how Railz actually works: https://vimeo.com/272172176
To join the Railz ICO whitelist: http://www.railz.org/whitelist
