Final Technical Report - Comprehensive Consensus Guide
ZC-1 seamlessly integrates Directed Acyclic Graph (DAG) ordering with Byzantine Fault Tolerance (BFT) checkpoints and Verifiable Random Function (VRF)-selected committees, further enhanced by AI-assisted rotation to ensure fairness and efficiency. The protocol delivers finality in under 2 seconds, targets scalability beyond 100,000 transactions per second (TPS), and enables seamless mobile participation through lightweight validation, data availability (DA) sampling, and delegated staking.
Designed with UK regulatory compliance in mind, it incorporates Environmental, Social, and Governance (ESG) incentives to promote sustainable and ethical network operations.
The architecture supports applications built on an Ethereum Virtual Machine (EVM)-compatible execution layer, with the core consensus mechanism blending DAG-based ordering and BFT finality. Complementary modules handle Governance & ESG, Interoperability, and Compliance.
Security & Privacy features include post-quantum (PQ) cryptography and zero-knowledge (ZK) proofs for enhanced protection. Networking & Storage manages efficient gossip protocols, erasure-coded data availability, dynamic pruning, sharding, and edge gateways to optimize data distribution and access.
Participants bond stake to join the network, with optional Know Your Customer (KYC) integration via trusted custodians for enhanced identity verification. Each consensus round generates a cryptographic seed, from which VRF selects a committee of K validators. A lightweight reputation system subtly biases proposer selection to favour reliable participants, promoting long-term network fairness.
Validators produce blocklets that reference at least N - f prior-round blocks (where N represents the total validator set size and f the Byzantine fault tolerance threshold). A deterministic reduction process extracts a consistent DAG cut, forming a batch candidate for validation and inclusion.
Finality is achieved through a two-phase voting mechanism: prevote followed by precommit. Once 2/3 or more of the stake-weighted votes are secured, the checkpoint is finalized, a receipt is broadcast, the state machine advances, and obsolete DAG sections are pruned for efficiency.
Transaction batches are encoded using Reed-Solomon codes into k + r shares, distributed across validators for redundant storage. Light clients verify availability by sampling m shares; any detected withholding prevents finality and incurs slashing penalties on the responsible proposers.
Penalties are enforced for violations such as double-proposals, double-votes, invalid state transitions, or DA withholding. The fork choice algorithm prioritizes the chain extending from the most recent finalized checkpoint, ensuring network convergence.
Mobile devices (e.g., smartphones) engage via lightweight operations like signature verification, DA sampling, and proof checks. For active staking or validation, users can delegate through edge gateways or participate in micro-committees.
Adaptive duty-cycling adjusts activity based on battery life and thermal limits. Finality receipts encapsulate VRF epoch data, aggregate signatures, and DA proofs for verifiable transparency.
The system assumes an adversary controlling less than 1/3 of the total stake, capable of delaying, withholding, equivocating, or censoring messages. Clients and gateways are treated as untrusted entities. Bridge security is bolstered by light-client (LC) or ZK-based verification, supplemented by challenge windows to contest invalid transfers.
Operating under partial synchrony, the protocol uses gossip with a fan-out approximating √n and rotating peer connections. Timeouts dynamically adjust based on observed latency percentiles to maintain resilience in varying network conditions.
| Parameter | Default | Notes |
|---|---|---|
| Validator set (n) | 400–1,200 | Stake-weighted selection with support for gradual validator churn |
| Committee size (K) | 64–256 | Dynamically selected via VRF per round |
| Fault tolerance (f) | < n/3 | Standard Byzantine fault tolerance bound |
| Batch size | 1–4 MB | Optimized with erasure coding for compact storage and transmission |
| Checkpoint interval | 250–500 ms | Balances latency and finality; adjustable based on network load |
| Gossip fan-out (g) | ≈ √n | Employs rotating peer sampling for efficient propagation |
| DA samples (m) | log(k + r) + δ | Ensures probability of undetected withholding is below 2⁻⁴⁰ |
| Slashing amount | 0.5–5% stake | Tiered penalties scaled by violation severity |
| Unbonding period | 14–21 days | Prevents long-range attacks by delaying stake withdrawal |
The protocol employs post-quantum signatures (e.g., Dilithium or Falcon) for future-proof security. zkSNARKs and zkSTARKs facilitate efficient verification. Selective-disclosure techniques enable privacy-preserving KYC attestations, allowing users to reveal only necessary information during audits or compliance checks.
Transactions incorporate a base fee plus optional tip; validators earn tips alongside a portion of base-fee rebates, aiming for a 6–12% annual staking yield. Maximal Extractable Value (MEV) is mitigated through fair DAG ordering and encrypted mempool phases.
Denial-of-Service (DoS) defenses include adaptive fees, per-origin rate limits, peer reputation scoring, greylisting, and optional Proof-of-Work (PoW) challenges. Snapshot-based synchronization accelerates node bootstrapping.
Pseudonymous on-chain commitments are complemented by off-chain KYC through custodians. Selective-disclosure proofs support regulatory audits without compromising user privacy. ESG integration offers staking multipliers or bonus token emissions for validators demonstrating sustainable practices, such as energy-efficient operations.
Primary bridges leverage LC or ZK verification for trustless cross-chain interactions. As a fallback, threshold-signed bridges include slashing incentives, challenge protocols, and time-bounded proofs to minimize risks.
Network upgrades proceed in two phases: initial proposal with mandatory independent audit, followed by a stake-weighted on-chain referendum requiring quorum and time-locks. Emergency hot-patches are strictly limited in scope, protected by multisig controls, set to expire automatically, and mandate comprehensive post-mortem analyses.
Benchmarking focuses on key metrics: TPS throughput, latency distribution (CDF), finality durations, reorg depth (zero after commitment), energy consumption per transaction (measured on Android/iOS), bridge verification times, and DA failure incidence.
while True:
seed = derive_seed_from_last_checkpoint()
committee = vrf_sortition(validators, seed, size=K)
if self in committee:
msg = build_blocklet(pending_txns, refs=dag.select_refs(N_minus_f))
msg.zk_attest = optional_zk_attestations(msg)
broadcast(msg)
dag.update(received_messages)
if dag.has_checkpoint_candidate():
cand = dag.best_checkpoint()
votes = bft_prevote_precommit(cand, threshold=two_thirds_stake)
if votes.commit:
finalize(cand)
emit_finality_receipt(cand)
prune_old_dag(cand)
rotate_reputation_scores()