Algorand Blockchain Core Protocol Overview - YouTube

Blockchain technology was created to enable economic systems where borderless

transactions can be achieved without the need for a central authority, but without

these how do users agree on which transactions should be written to the

blockchain, how do they come to consensus. Algorand securely and efficiently achieves consensus in a fully

decentralized Network, as long as the supermajority of honest users agree on

what should be added to the chain. Users participate in consensus through

participation nodes, and nodes submit users votes to the network. Algorand

ties the security of the whole economy to the honesty of the majority of the

economy, unlike other protocols which tie it to a small subset of their economy

such as miners or delegates. In Algorand, it's impossible for the owners of a

small fraction of the stake to harm the whole system, and it would be foolish for

the owners of the majority of the stake to misbehave, as it would diminish the

network overall. Algorand's consensus protocol is based on our unique approach

that we call Pure Proof of Stake. Users are selected to participate in consensus

based on their stake, or the number of tokens they own. It's similar to a

lottery, with each token representing a lottery spin. The more tokens a user has

the better chance they have of winning the lottery and being selected. This

method is used to select which users propose and vote on a block as well as

how many votes a user gets, one per lottery win in the voting process to

approve a block. users are selected to participate with a verifiable random

function, or VRF, which acts similar to the lottery. This function can be

executed on any node, for any user, and allows the selected user to prove their

selection or their winning lottery to the network with a cryptographically

signed proof that gets propagated to every participating node.

For each round of the protocol a unique set of users is randomly, and privately

selected independent of earlier sets. This selection process is very fast, as

it does not require any collaboration among nodes.

Therefore, the addition of nodes does not slow the process down. It's also very

secure. An adversary does not know who matters in generating the next block, and

therefore should be corrupted until after a selected user participates and

by the time an adversary realizes that a user is selected it is too late for them

to benefit from an attack. The user has already sent their message and fulfilled

their responsibility in the protocol. So here is how consensus is achieved and a

block is written to the blockchain. When Alice sends a transaction to Bob it's

submitted to a node in the Algorand network and placed in a queue with other

transactions. These transactions are propagated to all the nodes in the

network. Every node then executes the VRF, or plays the lottery, for every

participating user for essentially every token they own. If a user on a node gets

selected, that node selects a group of transactions from its queue to put into

a block and propagates the block along with its vrf proof to other nodes in the

network. Other nodes in the network will propagate blocks as well. As each node

receives this block it will hold it as the primary block proposal. If it

receives multiple blocks it will compare the vrf proof of each and only keep and

propagate the one with the lowest proof. Eventually only one block proposal will

remain. To verify agreement on the current block proposal another vrf, or

lottery, is executed for every participating user in the network to

select a group of users to vote on this proposal. Their voting power is

determined by how many times they win the lottery. This committee of users then

propagates votes for the block proposal to the network.

Every node in the network accumulates these votes, and when a supermajority

vote of the committee is reached for a proposal it is considered the block to

be certified. The VRF is executed a third time to select a group of users to

certify the selected block. Again, their voting power is determined by how many

times they win the lottery. The newly chosen committee then votes to

certify the block. These votes are propagated to the network and

accumulated by each node. Once a super majority of votes are accumulated the

block is written to the blockchain. This whole process takes less than five

seconds. Alice's transaction to Bob is finalized and the process begins again.