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Consensus Mechanism

Both the payment channel consensus and the network consensus between the Lightning Oracles are reached on the basis of Proof of Stake (PoS). All Lightning Nodes working as oracle validators and participating in this process form the DON of the Dapp. This consensus mechanism ensures the functionality and security of Plenny.

The DON is neither a lightning hub nor a sidechain. It is an independent network interconnected with the LN and the Ethereum ecosystem. Off-chain computations are collected by oracle validators in a cryptographically secured manner and transmitted on-chain to Plenny’s smart contracts. The consensus mechanism ensures data integrity and mitigates evidently valueless information from entering the DON.

In detail, the validation process to reach consensus works as follows:

  • All elected validators are linked to each other via the DLSP module to share data and confirm consensus over HTTPS connections, which enables communication among oracles offchain.
  • When a new channel is opened or closed, the elected validators try to obtain enough cryptographic signatures for reaching consensus.
  • The oracles get the data from the Bitcoin Lightning Network.
  • The oracles compete with each other to obtain a sufficient number of signatures from other validators.
  • The signature is a hash key of the channel info and channel data signed with the oracle's private key. They are generated off-chain using the DLSP module.
  • The validators’ signatures are matched against the channel data already stored in the smart contract. If the signatures are valid, the opening or closing of the channel is confirmed.
  • The validator who obtains enough cryptographic signatures first is the consensus winner and authorized to post the validation data, confirming consensus on-chain on the Ethereum blockchain.