MIT researchers have developed a new cryptocurrency that drastically reduces the data users need to Combine the network and verify transactions by up to 99 percent compared to the current popular cryptocurrencies.
Cryptocurrencies, like the popular Bitcoin, are networks constructed on the blockchain, a financial ledger formatted at a succession of individual cubes, each comprising transaction information.
To combine a cryptocurrency, new users need to download and save all trade data from hundreds of thousands of individual blocks. They must also store these data to utilize the service and help confirm transactions. This makes the process slow or computationally impractical for some.
In a paper to be presented at the forthcoming Network and Distributed System Security Symposium, the investigators introduced Vault – a cryptocurrency that lets users join the network by downloading only a fraction of the total trade information.
Additionally, it incorporates techniques that delete empty balances which take up space, also enables verifications using only the latest transaction data that are divided and shared throughout the system, minimising an individual user’s data storage and processing requirements.
“The paper title is a pun.
“When I’m bootstrapping, I only need a block from way from the past to confirm a block way later on. I am able to skip over all cubes in between, which saves us a lot of bandwidth”
In experiments, Vault reduced the bandwidth for joining its system by 99 percent when compared to Bitcoin and 90 percent when compared to Ethereum, which is thought to be one of today’s most efficient cryptocurrencies.
Importantly, Vault still guarantees that all nodes affirm all trades, providing tight security equivalent to its present counterparts.
The researchers built their system in addition to a new cryptocurrency network called Algorand, which is protected, decentralised, and more scalable than other cryptocurrencies.