Chain Quality (CQ) is a core blockchain property.
Roughly speaking, it says:
Owning 3% of the stake gives you control over 3% of the blockspace over time.
Chain quality was sufficient for early generations of blockchains that had low throughput — but modern blockchains have much higher bandwidth and can commit many transactions within a single block.
This motivates a stronger, more fine-grained notion that captures the division of blockspace inside each block, rather than only the fraction averaged over time.
We call it Strong Chain Quality (SCQ):
Owning 3% of the stake gives you control over 3% of the blockspace in every block.
In essence, this property gives stakeholders the ability to have virtual lanes inside a high-throughput blockchain, guaranteeing them transaction inclusion.
One of Bitcoin’s key innovations, now present in virtually every blockchain, is the introduction of an in-protocol reward mechanism for block proposers: Newly minted tokens and transaction fees are granted to the party that successfully appends a block to the state machine.
These rewards are specified in the state-transition function and reflected in the resulting system state.
In traditional distributed computing, parties are split into honest and malicious.
There is no need to reward honest parties for correct behavior; their honesty is assumed as part of the model.
In the cryptoeconomic model, parties are modeled as rational actors, possibly with unknown utility functions — and the goal is to design incentives so that their profit-maximizing behavior aligns with the success of the protocol.
Together with the in-protocol reward mechanism, this leads to the following idealized definition of Chain Quality: Chain Quality (CQ): A coalition that holds X% of the total stake has, after GST, probability X% of being the proposer of each block that enters the chain.
A chain that deviates from chain quality may allow coalitions to accumulate an outsized portion of the reward, hence disincentivizing honest behavior and threatening the security of the protocol.
Many modern blockchains satisfy, or aim to satisfy, this property by using stake-weighted randomized leader rotation.
Notable challenges are Bitcoin’s Selfish Mining (in that literature, CQ is called Ideal CQ, see here); Monad’s tail forking resistance; and Ethereum’s LMD GHOST protocol (where CQ issues are often called “reorgs”, see Goldfish).
When blockspace is abundant, there is no need to give a single proposer monopoly power over the content of the entire block — instead, blockspace can be divided among multiple parties for the same block.
The following cryptoeconomic definition of Strong Chain Quality captures this idea: Strong Chain Quality: A coalition that holds X% of the total stake has, after GST, control over X% of the blockspace in each block.
This idealized property implicitly leads to the abstraction of virtual lanes, where coalitions effectively control a dedicated fraction of blockspace within each block.
From an economic perspective, owning a virtual lane corresponds to holding a productive asset that may yield fees and MEV revenue.
Competition among external entities to acquire and maintain such lanes, through stake accumulation, creates sustained demand for the underlying L1 token.
The greater the economic value that a given lane can generate, the stronger the incentives to compete for stake, and the more value accrues to the L1 stake that governs access to that blockspace.
This abstraction allows for stronger notions of censorship resistance that are captured by the SCQ validity property of the protocol.
Recent work highlights the importance of censorship-resistant protocols that include all inputs from honest parties immediately rather than only eventually.
Strong Chain Quality (SCQ) can be viewed as an extension of this property to a setting with fixed block-capacity constraints.
In practice, no protocol can satisfy the ideal notion of censorship resistance if there is more demand for transaction inclusion than available blockspace.
SCQ addresses this limitation by not requiring that all honest transactions always be included, but rather giving all staked nodes a budget under which they are guaranteed transaction inclusion.
The MCP protocol was proposed as a gadget on top of existing Practical Byzantine Fault Tolerance (PBFT)-style consensus protocols to make them censorship resistant.
This protocol additionally satisfies SCQ by assigning proposers blockspace pro rata based on stake (cf. section 5.3 of MCP).
Existing DAG-based BFT protocols provide a way to implement a multi-writer mempool that also provides some level of censorship resistance.
Standard implementations of these protocols fall short of strictly achieving SCQ due to allowing leaders to selectively delay subsets of transactions.
However, slight modifications to these protocols can allow them to regain SCQ (see recent results here and here).
A related topic is forced transaction inclusion for reducing censorship (see also EIP-7805).
MCP additionally shows how to obtain a stronger hiding property that essentially allows stakeholders to create virtual private lanes whose content is only revealed when the whole block is made public.
We will expand on this aspect in future posts.
Obtaining Strong Chain Quality post-GST requires guaranteeing that the proposer cannot censor the inputs of the stakeholders.
This is achieved via a two-round protocol with two small changes to almost any view-based BFT protocol:
Round 1: Each party sends its certified input to all parties.
Round 2: Each party that receives a certified input from party i adds i to its inclusion list. It then sends its inclusion list to the leader, essentially committing that it will only accept blocks that contain all the inputs in this list.
BFT Proposal: The leader receives these messages and includes in the block the union of all the inclusion lists that it received.
BFT vote: A party only votes for a block if it contains all the inputs in its inclusion list.
It is easy to check that this protocol sketch can be converted into a full protocol that satisfies post-GST Strong Chain Quality, provides censorship resistance, and is live for an honest leader. Adding pre-GST SCQ would also require waiting for a quorum of values or lists in each round. We will expand on this protocol and its generalizations in later posts.
Recent work has shown that Strong Chain Quality and censorship resistance require two more rounds on top of the voting rounds of a regular BFT protocol (as the protocol sketch above does). We will also expand on this result in later posts.
While Strong Chain Quality (SCQ) dictates the fraction of blockspace that a coalition can control, it does not fully specify how transactions are ordered for execution.
SCQ can be interpreted as reserving space in a set for every staked node with no guarantees on how the transactions in that set are ordered.
This opens a rich area of research into the design of transaction ordering mechanisms that can further enhance fairness and efficiency within the blockchain ecosystem.
One promising approach is to order transactions according to priority fees.
We will expand on the nuances of ordering in future posts as well.
Leave a Reply