Low-Latency Blockchains with DAG Holography
Classical Proof-of-Work blockchains like Bitcoin implement a decentralized ledger, where anyone can participate. They aggregate transactions from system users in blocks and decide each block's position in the ledger. They require the block at each position to accrue votes until the probability of a decision change, due to chance or malice, is negligible. To allow consumer usage of such systems, low latency in the order of seconds is necessary. In classical blockchain systems latency is in the order of hours. Recent protocols use parallel voting and reach low latency, but require a prohibitively high overhead bandwidth.
We present Holograph, a blockchain protocol that achieves a latency of seconds under practical bandwidth limitations. To achieve this we introduce a novel technique called dag (Directed Acyclic Graph) Holography. Holograph participants form a single physical block dag. Each physical block manifests as multiple virtual blocks in multiple virtual dags that serve as parallel voting structures. By viewing the same physical dag as many virtual ones, like a holographic image viewed from different angles, we obtain more votes with the same bandwidth.
We analyze Holograph’s latency as a function of overhead bandwidth limit, compared against prior art. To the best of our knowledge, this is the first such analysis of blockchain protocols. Our simulation shows that Holograph reaches the lowest latency across the tested bandwidth range, improving latency by about 5x compared to the state-of-the-art when bandwidth is limited. We run a prototype implementation in an emulated network reaching a latency of 7 seconds with 10kbps overhead bandwidth, which is 45% lower than the state-of-the-art with an order-of-magnitude lower, practical overhead throughput.