What Makes Solana So Fast? An Overview of Solana’s Consensus Mechanism

Over the last several years, various blockchains have emerged as potential alternatives to Ethereum. One such network is Solana, a high-performance, permissionless blockchain whose smart contracts allow anyone to build dApps or other decentralized tools. 

One of the key differences between Ethereum and Solana is scalability. Solana is able to process data significantly faster than Ethereum by combining the proof of stake consensus mechanism with proof of history – a unique way to represent time.

The result is a network that is both decentralized, secure, and as fast and efficient as traditional (i.e., centralized) computer networks. Solana is also energy-efficient, with a single transaction consuming as much energy as that of three Google searches. 

In this article, we’ll guide you through Solana’s consensus mechanism and explain what makes this network so fast. 

It’s All About the Consensus

Remember how blockchains work? At the heart of these distributed, verifiable, and trustless networks are consensus mechanisms. With no central company or person controlling who can and cannot interact with a network, it is critical that all network participants (miners or validators) actively support the network and validate new blocks.

‘Consensus’ refers to the process in which a majority (at least 51% of miners for a proof of work blockchain and at least 67% of validators for a proof of stake blockchain) of nodes in a network confirm that data on the chain is correct. This includes new data being entered into the network, as well as historical information about past transactions. 

A ‘consensus mechanism’ simply refers to the type of technology used to generate agreement about the accuracy of data in the network.

Every blockchain has a consensus mechanism, and the type and design of consensus mechanisms can vary from blockchain to blockchain. However, there are two types of consensus mechanisms that are particularly popular.

Proof of work

Proof of work (PoW) is the consensus mechanism currently used by both Bitcoin and Ethereum. In order to verify blockchain data, miners compete to solve cryptographic puzzles that are randomly generated by a cryptographic algorithm. 

If they successfully complete the puzzle, their block proposal is confirmed as authentic, the data is added to the block, and the block is added to the chain. The “work” in PoW refers to the computational power used in solving these cryptographic puzzles.

Serving as a data validator yields ‘block rewards’, i.e., an amount of cryptocurrency paid as a fee. In PoW, the process of validating data and generating blocks is called “mining”. The PoW consensus mechanism is one of the original blockchain consensus mechanisms, but an increasing number of blockchain projects have begun to move away from it due to its scalability problems and high environmental cost. 

Solana’s proof of stake

Proof of stake (PoS) is a consensus mechanism that many alternative blockchain layer-1 solutions use, including Solana. In fact, Ethereum is also in the process of transitioning its consensus mechanism from PoW to PoS, due to PoS’ scalability and efficiency. 

In a PoS system, validators are chosen based on their stake in the network’s native token (e.g SOL). In most PoS networks, validators stake their own cryptocurrency. In some networks, including Solana, validators can also have cryptocurrency delegated to them by other network users. 

For example, when you delegate SOL to a validator, you’re not transferring ownership of your SOL. Instead, you’re using your SOL to empower the validator to vote on your behalf. In delegating SOL to a validator, delegators are placing their confidence in the ability of that validator to stay up to date with the network and vote correctly.

You can delegate your SOL to a validator directly or you can use certain exchanges (including Coinbase and Gemini) to delegate your crypto to a much larger pool of currency that the exchange stakes on your behalf. 

In contrast to PoW, validators taking part in a PoS consensus do not compete to earn rewards. Instead, validators are selected by the network according to the leader schedule. The chance to get selected is proportional to the validator’s stake. Once a new block is successfully proposed, the validator is rewarded through transaction fees paid by network users. 

Many PoS networks require a minimum threshold of staked tokens in order to participate. In the Avalanche ecosystem, new validators are required to self-stake 2,000 AVAX. On Ethereum, the minimum is 32 ETH. On Solana, there is no minimum stake required, though most validators do self-stake at least 100 SOL.

But, what makes Solana’s consensus mechanism truly innovative is the combination of PoS validating with a novel timekeeping mechanism: proof of history. 

Understanding Proof of History

To stay decentralized, blockchains need to constantly verify the correctness and ordering of transactions, at the same time that they are happening. All of this checking takes time, even if it’s only milliseconds!  

As mentioned, Solana uses a standard PoS system to verify and produce new blocks on the chain. However, it also employs proof of history, a cryptographic algorithm that generates a ‘timestamp’ on all pieces of data as they move through the network. 

Every piece of data on the Solana blockchain has a time that acts as both:

1) an order, describing exactly when the data existed on the network, and 

2) an account of change, as these special ‘time stamps’ describe time in relation to all other data and blocks on the network. 

How does proof of history make Solana faster?

Since time is relative, the PoH consensus mechanism allows the Solana blockchain to run and keep a cryptographically-secure, atomic “clock”, that enables validators to check the time and ordering of all data regardless of whether or not they’re connected to the entire network.  

Imagine going to a friend’s house and meeting their siblings for the first time. You may not know the exact birthdate of each one, but you will likely know who is older, who is younger, and the order in which each was born. This is exactly how the Solana blockchain keeps ‘time” by ordering new data against each other, and in reference to a single, internal “clock”. It’s not about the exact time per se, but about the order and structure of blocks in relation to the chain. 

As a result of this time keeping and other optimizations in transaction processing, Solana has become one of the speediest blockchain networks, generating blocks hundreds of times faster than other, similar networks. And because of these optimizations, it’s also one of the most affordable networks. 

This speed has helped fuel Solana’s growth into one of the largest and most popular blockchain networks in the world by market cap, and an increasingly popular network for minting NFTs. 

Diving Deeper with Solana

Aside from its speed and interesting consensus technology, many people are first attracted to Solana because of its lower transaction fees. The efficiency of PoS combined with PoH means that Solana transaction fees are significantly cheaper than on other networks. 

Other people simply like a diverse marketplace, and enjoy that Solana is a smaller, up-and-coming ecosystem. 

Regardless of your interest, there are many ways you can learn more and get engaged with Solana! To get started, set up a wallet and figure out what you’re most interested in trying.

Whichever path you take, be sure to let us know how it goes. Join Surge on Discord to ask questions and discuss your Solana adventures.