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Proof of Entropy Minimum (PoEM)

Proof of Entropy Minimum is heavily based on the Proof of Work Nakamoto consensus. It is highly recommended to have a solid understanding of Proof of Work consensus before reading the PoEM documentation. A detailed explanation of Nakamoto consensus can be found here. The formal Proof of Entropy Minimum research paper can be found here.

Blockchain nodes work together to agree on a list of transactions and the order in which they are recorded. How these nodes reach agreement (called the consensus mechanism) is critical to ensuring the reliability and censorship resistance of the blockchain.

Quai Network uses a consensus mechanism called Proof of Entropy Minimum (PoEM). PoEM is inspired by Bitcoin's consensus mechanism, called the Proof of Work (PoW) Nakamoto consensus. PoEM, like PoW, uses hashes generated by competing miners to verify the validity of proposed blocks. However, PoEM differs from PoW in how these hashes are compared and measured.

Unlike PoW, which considers all blocks that meet a certain difficulty level to be equally valid, PoEM measures the intrinsic block weight to calculate the entropy or randomness removed by each proposed block. This ensures that all nodes always prefer a particular block over any other option.

Under PoEM, all nodes agree on the next block as soon as they become aware of it, eliminating any disagreements caused by network latency. Two nodes running PoEM will always agree on the next block in the chain.

By eliminating contention in consensus, PoEM allows all nodes to remain in constant agreement. This is unlike all other consensus algorithms, which take time to reach consensus or resolve conflicts.

PoEM’s “perpetual consensus” offers several advantages over existing consensus mechanisms such as Proof of Work and Proof of Stake, including instant fork resolution and faster finalization. These properties give PoEM the unique ability to maintain consensus while coordinating an unlimited number of execution shards.

Instantaneous Fork Decisions: Given the same set of information, every node in the system will always make the same decision about the next block in the sequence.

Faster Finality: Proof of Entropy Minimization provides faster mathematical guarantees of on-chain inclusion than all existing consensus mechanisms.

Coordinating an unlimited number of execution shards: Permanent consensus is a prerequisite for coordinating an unlimited number of execution shards. Mechanisms that require any amount of time to resolve contention in a consensus manner are ineffective for coordinating multiple chains.