We’re continuing to make rapid progress at V SYSTEMS. Just two months ago we listed the VSYS Coin on three top exchanges to provide access to V SYSTEMS for anyone who shares our belief in Sunny King’s vision of ubiquitous blockchains driving all manner of businesses, entertainment and public services. With the mainnet continuing to run flawlessly, we’re forging ahead with the items on our 2019 Roadmap.
Let’s talk security
But there is an area which we haven’t focused on much in this blog — security and stability. In our second whitepaper we provide more details about the V SYSTEMS SPoS network — in particular, information about how the SPoS layer enables greater security and stability than in previous blockchain platforms.
As we’ve described previously, by breaking the link between consensus and power consumption, SPoS consensus introduces greater speed and scalability to the previously limited capacity of Proof of Work models. This changes the dynamic of participation in the running of the network which have significant impacts on stability and security.
When it comes to security, the most common concern for blockchains is of a 51% attack, where network participants gain control of enough of the system’s resources to take control — a situation antithetical to nature of a distributed network.
In the Bitcoin blockchain, miners’ opportunity to find the next block is greater if they have a higher hash rate, which is the speed at which they are completing operations. This means that miners are always looking to increase their hash rate to retain an advantage and maximise the rewards they gain from mining. Higher hash rates also contribute to security against a 51% attack, as the resources required to assemble a majority stake by hashing faster than everyone else would make such an attack extremely expensive.
SPoS — safe against attack
By comparison, because an SPoS network determines consensus weightings according to coin holdings rather than power consumption, there is no need to keep increasing the hash rate. Block generation in an SPoS network is called minting and happens at a constant rate, compared to the random timing of block generation in Bitcoin. Constant minting is inherently more stable and also enables greater performance benefits — and it contributes to resilience against 51% attacks.
In order to participate in minting, miners must have a minting slot, of which there are 60, corresponding to the seconds in a minute. This timing is co-ordinated via Network Time Clock which is very secure in itself. All minting slots have equal standing and minting output in the network. This prevents the formation of monopolies, ensuring that the system’s distributed nature is preserved.
Contention for slots is free to happen but contention fees are quite high to deter abuse. When a challenger issues a contention transaction, the stakes of both current minter and challenger are examined by the protocol to determine the winner. This calculation takes into account the coins both owned and leased by the minter. Accumulating enough coins through ownership or leasing to mount a 51% attack is fundamentally uneconomic as the price of coins would spike in response to increased demand, putting a dominant stake out of reach.
Busy contention attacks
Critics have pointed out that this system might be vulnerable to a ‘busy contention attack’, where the same stake could be used to claim minting rights on multiple minting slots. To prevent this, we are introducing a sophisticated account balance measure which requires each stake to remain a short while in the account participating in contention to ensure the full amount is available when the contention judgement takes place. While we believe there is an economic advantage to stake mobility, this balance calculation ensures that mobility can’t be exploited to contest more than one slot at a time.
Overall, by creating a system where the key operations are sustained and controlled according to the value of participants’ stake in the system, rather than by the power they can bring to bear, V SYSTEMS is creating a system with security built into its fundamental design. When blockchains are running billions of databases, they’re going to have to be secure — and SPoS is the way to go.