Video 6: How to reach agreement using consensus algorithm (and stop useless discussions)

This is the part of blockchain with which you easily get rid of the “hey I was here first” argument.

One of the main traits of blockchain is its distributed nature. The so-called nodes, i.e. single networks forming the blockchain, could each consist of a copy of the chain, so that there can not be pointed to anyone as the main culprit.

With a large blockchain you look at the majority and the majority is there to decide. But what happens when an consensus must be reached with more than two parties involved on a single blockchain, while having a chance of conflict among parties?

Anchoring

‘To resolve such a conflict, we have to reach consensus’, developer guru Arnold Daniels says in this week’s video. ‘You have several ways to reach consensus. We can use computing power, like bitcoins, or tokens, this is called proof of stake.

Arnold continues: ‘With our system both methods are not applicable, there are so few parties involved that we can’t say we want a majority. We are using anchoring instead to involve everyone to reach consensus.’

But what happens when there are two players involved who claim their action happened to be first? ‘Both might be right from 𝓲𝓽𝓼 𝓸𝔀𝓷 point of view. In that case, both might consult the public ledger, which tells the action was anchored first will win’, Arnold says.

‘However, in some cases we don’t want to use the public ledger deciding the order’, Arnold says. ‘Let’s take an example of vehicle impoundment. At some point you may want to pay a fine and if you don’t the car would get demolished. However, if this happens at the same time, you might want to get the car saved rather than looking strictly at which action happened first. In that case, we set the priorities for these actions.’

‘You see as we are using a private blockchain, we can be flexible about the consensus algorithm, making it part of our agreement’, Arnold concludes.

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