Scalable Blockchain Protocol Based on Proof of Stake and Sharding

Abstract

Blockchain – a distributed and public database of transactions – has become a platform for decentralized applications. Despite its increasing popularity, blockchain technology faces a scalability problem: the throughput does not scale with the increasing network size. Thus, in this paper, we propose a scalable blockchain protocol to solve the scalability problem. The proposed method was designed based on a proof of stake (PoS) consensus protocol and a sharding protocol. Instead of transactions being processed by the whole network, the sharding protocol is employed to divide unconfirmed transactions into transaction shards and to divide the network into network shards. The network shards process the transaction shards in parallel to produce middle blocks. Middle blocks are then combined into a final BLOCK in a timestamp recorded on the blockchain. Experiments were performed in a simulation network consisting of 100 Amazon EC2 instances. The latency of the proposed method was approximately 27 s and the maximum throughput achieved was 36 transactions per second for a network containing 100 nodes. The results of the experiments indicate that the throughput of the proposed protocol increases with the network size. This confirms the scalability of the proposed protocol.