Leading blockchains such as Bitcoin (BTC) or Ethereum (ETH) store hundreds of gigabytes of transaction data. Their main disadvantage is that they store the complete history of the blockchain. In other words, users can trace the entire chain of transfers back to the first transaction.
This will lead to the fact that the weight of the blockchain will grow over time, so the nodes (large miners) will have to constantly increase the memory in order to store the entire blockchain. And ordinary users, most likely, will use “light” clients, which only read the heading from the block and check the validity of the wallet balance. In this case, there is a need to trust large nodes (servers). Perhaps in the future, this will lead to partial centralization, as the transaction history will be stored on several large nodes.
The Mina Protocol platform, which will be discussed in this article, takes a different approach. We will describe to you what kind of platform it is, what features it has, and why crypto enthusiasts should join in.
What is Mina Protocol?
Mina Protocol is a next-generation Proof-of-Stake blockchain that stores transactions in succinct form. The Mina blockchain is only 22KB in size. It is noteworthy that the size of the blockchain is immutable no matter how long it is used. Thanks to this, Mina Protocol provides fast synchronization of nodes.
Mina operates on Succinct proofs of state or SNARK-based compressed proofs of state. It is thanks to this approach that it is possible to achieve such compression.
What is SNARK and why the Mina Protocol blockchain is always the same size?
For a more accurate and detailed understanding of how the Mina Protocol blockchain works, you should read the Mina Protocol technical documentation, but this requires in-depth mathematical and technical knowledge. In this section, we will try to explain in a simplified way what a SNARK is and what constitutes the genius of the Mina Protocol solution.
Zk-Snark (Zero-Knowledge Succinct Non-Interactive Arguments of Knowledge) is succinct cryptographic proof that checks blocks for validity.
In the abbreviation SNARK, “succinct” means that the evidence is small and can therefore be quickly verified. “Non-Interactive” means that there is little or no interaction between the prover and the verifier, they only share one piece of evidence. This paves the way for zk-SNARK technology to be used as a privacy and scalability solution.
When the Mina Protocol generates a new block, the SNARK proof is generated along with it.
Zk-SNARK functions as a genuine certificate to prove that a computation (verifying transactions in a block) was performed correctly, without confirming the computation itself. This way, a SNARK validates the block’s transactions without having to display all transactions. This effectively reduces the block size to one SNARK.
Replacing every block with a SNARK is not a solution, as it will still lead to linear growth as SNARKs accumulate, albeit much slower than existing blockchains.
And here lies the ingenious solution provided by the Mina Protocol developers, since SNARK can be used to validate or certify any computation. Creating a SNARK is also a computation, so you can create a SNARK from multiple SNARKs. Therefore, every time a new block is created, a new SNARK certificate is generated accordingly. It is also possible to create one SNARK confirming previous certificates. After that, one “super” SNARK can be created that proves the entire transaction history of the blockchain, allowing you to go from the first block (genesis block) to the current state, while remaining the same size as one certificate. This process can be called recursive SNARK composition, which allows the blockchain to remain constant in size (less than 22KB).
In a very simplistic way, recursive SNARK certification can be compared to recursive snapshots. Let’s take a snapshot of the first block, and then we take this snapshot and take a snapshot of the new block along with the previous snapshot, and this can be continued recursively taking snapshots of the previous snapshots. Thus, the blockchain size is always the same (size of one snapshot).
As a result, the nodes of the network do not store the entire history of the blockchain, but only the proof that the blocks were valid. At the same time, the security and decentralization of the network are preserved.
Which roles there are in the Mina Protocol and how transactions are confirmed
Mina operates on the principle of proof-of-stake consensus. Unlike other legacy protocols, any participant can validate transactions as a full node, making decentralization possible. And here the node operators can play two roles: they can create blocks and/or they can create SNARKs.
The blockchain is already working, and any user can deploy their own node in the Mina Protocol network. For details on how to do this, see the Mina Project documentation.
There are two groups of validators in the Mina blockchain:
- Block Producers, who are represented in other blockchains as miners or validators. Typically, block producers choose which transactions to include in the next block. Obviously, they are interested in including the transactions with the highest fees. If a block producer wants to add 5 transactions, they must add 5 corresponding transaction SNARKs, which they can buy on a special market (Snarketplace), from other specialized network participants – Snarkers.
- Snark-workers or Snarkers are network members who create zk-SNARKs to verify transactions. They are compensated for this in the form of a commission, and if their SNARKs are used in a block, the block producer pays this fee out of the total fee for that transaction.
To understand how the Mina Protocol works in practice, consider a step-by-step transaction scenario. For example, sender Mike wants to send recipient John a number of coins.
- Step 1. Create payment – Mike clicks Submit.
The payment is cryptographically signed with a private key so that the sender’s account can be verified. It is then sent to nodes on the network for processing.
- Step 2. Mike’s payment is added to the task list.
A block producer node is selected in the network for a given time interval.
All block producers select payments on the fly and list them for processing and block building.
- Step 3. The block producer must add the corresponding SNARK to each selected transaction.
They buy these SNARKs from the Snarketplace. Among those SNARKs is Mike’s transaction confirmation.
- Step 4. The block producer adds new transactions and corresponding SNARKs to the block, and the new block is added to the Mina blockchain. After that, the status of the transaction queue is updated. And the block producer updates the SNARK for the blockchain with a new block, i.e. the new state of the blockchain. After that, the new block is considered confirmed and all network participants see the new state of the blockchain.
Mike and John’s accounts display the result of the transfer.
- Step 5: Level of payment validity – John is confident that the transfer is complete.
With each successive block, the recipient has a higher degree of confidence that the payment is indeed complete and that the network has a consensus on that block. However, as with most blockchains, payments are believed to be confirmed after a certain number of blocks, also known as the completion of a transaction.
To remove the trust element from the Mina network, the developers have added two important properties to Snark:
- Combinability. A Snark combines the two pieces of evidence to form a merger proof.
- Associativity. All merge proofs are identical to each other and do not depend on the order in which the merge occurs.
This approach allows any user to launch a node on the Mina network or become a Snark worker, receiving rewards for their work. This sets Mina apart from other blockchains that require either expensive mining hardware or large staking amounts.
Mina Protocol Delegation
Mina Delegation is an alternative to direct staking, with the advantage that you don’t need to maintain your own node, which must always be online.
But for delegation, it is important to choose an experienced and reliable block producer (validator). One such validator is Everstake, which is backed by a team of seasoned developers, financial experts and blockchain enthusiasts. Everstake is launching highly secure and reliable PoS nodes using enterprise-grade hardware to ensure maximum efficiency and security. By delegating your coins to the Everstake node, you can be sure of proper operation and timely reward.
MINA Token Distribution
The Mina Protocol economy is designed so that block validators use their MINA tokens to buy proof of snarks on the snarketplace. This ensures that new work appears as fast as it gets done.
Most cryptocurrencies and tokens have limited emission, and all coins are generated either in advance or during the process of mining, staking or minting. MINA tokens operate on the principle of inflation, not deflation, and have unlimited emission.
During the launch of the mainnet, 1 billion MINA tokens will be distributed, but they will be fully unlocked only after 8 years. Although the emission is unlimited, the token inflation rate will decline annually from 12% until it reaches 7%.
The graph shows the planned distribution of tokens for the first 8 years.
To encourage staking, Mina offers a Supercharged reward for the first 15 months for accounts that do not have blocked tokens.
In the first 5 months, this remuneration will be 24% per annum. Which is 2 times more than the usual staking reward.
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