Junaeth — The new standard in the blockchain industry
With its recent release of Junaeth, the Stealth cryptocurrency platform now has one of the fastest and most scalable blockchains in existence. In this blog post, I describe how Junaeth is different from other blockchain protocols and how it enables a range of uses unavailable to competing protocols.
To understand Junaeth, first we need to understand the most important aspect of cryptocurrencies: consensus. Consensus means that all parties with an interest in a particular system agree on the state of that system. An accounting ledger makes an ideal example to explain what is meant by a “system” in this context.
Imagine that a ledger holds balances for Alice and Bob, where both have $100. Consensus means that everyone will agree that Alice and Bob both have balances of $100. In traditional banking systems, a central authority (the bank) keeps the only official copy of the ledger. Anyone with an interest in the ledger simply asks the bank for their balance, trusting the bank to keep accurate records.
Cryptocurrencies, on the other hand, do not achieve consensus through a central authority, like a bank. Instead they achieve consensus through a type of competition. For bitcoin, this competition consists of many candidates’ attempting to solve a computational puzzle the fastest. Whoever finds the answer first becomes a temporary authority to validate all transactions submitted since the previous puzzle was solved. The nature of the puzzle is beyond the scope of this blog post, but it is important to note that these puzzles require incredible computational resources. The competition boils down to who has the most computing power.
Having a real-time competition like bitcoin’s puzzle solving means that the exact time when a validator will ratify the next set of transactions can never be known in advance. In other words, validation does not follow any schedule and ends up being random. Sometimes a validator will find the answer in a matter of seconds, and sometimes it takes hours. The experience for end users is often highly frustrating.
It goes without saying that this type of system is intensely inefficient. Not only does it use vast amounts of energy, the competition itself takes time, slowing the rate at which transactions can be validated.
Junaeth solves this problem by having the competition once, where validators simply buy their rights to be temporary authorities. When a validator buys these rights, the validator is put into a rotating queue that validates blocks. Each validator has 5 seconds to approve a block, or they lose their turn, and the reward that goes with it. The validation queue has absolutely no real-time competitive component, and therefore no inefficiencies that arise from competition. The resulting efficiency means that transactions will be confirmed rapidly and regularly, making the blockchain very pleasant to use. This type of blockchain consensus protocol, where validators have slots in a queue, is called a “scheduled” protocol.
In contrast to cryptocurrencies like Bitcoin, competition in Junaeth takes the form of an auction that not only decides validators, but sets a market price for the right to become a validator. Notably, these purchases entail irreversibly destroying the purchasing funds such that validators are permanently bonded. This bonding means that the activities of a validator create a permanent history and can be used to establish a purely quantitative reputation. Junaeth validators with better reputations earn greater rewards than validators with lesser reputations. This reputation system creates a strong performance-based incentive, and results in a highly dependable blockchain.
The Junaeth consensus protocol is unique not only for its permanently bonded validators and reputation system, but it is the only scheduled blockchain protocol that uses a highly flexible accounting system called “UTXO”. The essence of a UTXO system is that each UTXO is like a traveler’s cheque where the bearer (signatory) can spend them. UTXOs are highly versatile because each UTXO can have different spending conditions encoded in the identity of the signatory. The encoding is highly technical, but an example will help understand the versatility of uses.
The classic example for UTXO versatility is a multi-signature transaction. Multi-signatures are conceptually simple: more than one signature is required to spend a UTXO. Multi-signatures can come in subsets, where individuals A, B, and C could potentially be signatories, but a subset of only two (A and B, or B and C, or A and C) is needed. This type of multi-signature is called a two-of-three multi-signature UTXO. It is true that account-based systems can have these types of multi-signatures, but accounts have a problem in that there is no way to ensure that they retain their multi-signature properties and the accompanying security,
Spending conditions for UTXOs can get vastly more complex than multi-signatures because the spending conditions can be defined by a programming language cleverly named “Script”. Script supports numerous operations like addition, subtraction, conditionals, hash functions, bitwise operations, pushing data, duplicating data, and others. In short, UTXOs are programmable money, and anyone sending to a UTXO can be guaranteed that two UTXOs bearing the same address will have the same spending conditions.
The flexibility of UTXOs is perhaps most apparent in Stealth’s feeless transactions. Feeless transactions use a different type of UTXO that is unspendable. These are called “feework outputs” and are included with spendable UTXOs as a substitute for fees. Explaining the technology of feeless transactions would take its own blog post, but the important thing to remember is that a feework output is an optional attachment to a transaction, meaning that Stealth is unique in that it is fee-optional. One question is why anyone would want to pay fees if they have the option to not pay fees. The answer is that feeless transactions have special conditions that limit the potential for their abuse. Under certain circumstances, like periods of exceptionally high use or attack on the Stealth network, paid transactions will be given priority over feeless transactions.
To summarize, Junaeth sets a new standard in blockchain by being the first high performance consensus protocol using a UTXO ledger and quantitative reputation system. Additionally, this design allows Stealth to be the first fee-optional cryptocurrency. These attributes, and many others, make Stealth the most user-friendly cryptocurrency possible.
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Dr. James Stroud PhD
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