A Behind-the-Scenes Look at PoSW on Aleo

Aleo has adopted a unique consensus mechanism called Proof-of-Succinct-Work (PoSW). This raises the question: why does Aleo need PoSW in addition to Proof of Stake (PoS)?

The answer lies in the nature of the Aleo network. In Aleo, every contract execution requires generating a zero knowledge proof, which is computationally intensive. The more contract executions, the more computational power needed.

The proofs in Aleo are generated using the Marlin protocol. Leo programs are compiled into constraint systems supported by Marlin (R1CS), and then proofs are generated using Marlin.

Therefore, pure PoS is not enough. A key purpose of PoSW is to attract sufficient computational power into the Aleo network to generate proofs and pave the way for future delegated computing.

However, Aleo’s current PoSW is not for generating Marlin proofs.

For those familiar with major zero knowledge proof protocols, you would know that two types of computations — NTT and MSM, are core to these protocols. Almost all mainstream zk protocols heavily use these two computations (Marlin uses 10+ rounds).

Aleo has designed PoSW to be NTT + MSM computations. This essentially extracts some core computations out from Marlin, as a smaller unit compared to full Marlin proofs.

This serves two purposes — one, it continues to incentivize hardware capable of generating zk proofs to join Aleo. Two, splitting work into smaller units allows more flexible distribution of work and better composability. In theory, this portion of work can contribute to help generate proofs for any Leo program, as long as Marlin is still used as the backend proof system. These computations are core building blocks in smaller units. This decouples PoSW from Marlin.

Moreover, not just for Marlin, for other zk protocols that need NTT and MSM, this work is still meaningful.

In an ideal world, all provers in the Aleo ecosystem would be busy generating proofs for contract executions. But such a perfect world rarely exists.

Firstly, the incentive structure for compensating provers to generate “useful” proofs needs to be established. Since generating each proof requires intensive computations, it raises questions about who bears the cost. If contract users are expected to pay provers, there may be doubts regarding their willingness to do so. Additionally, the potential profitability for provers is a critical consideration. If the economic model does not offer sufficient profits for provers, it may not be sustainable at scale.

Secondly, stability concerns arise in the context of provers joining the proving network. Provers often incur startup costs when onboarding to the network, but the on-chain transaction volumes fluctuate, which can be unwelcoming for provers. During periods of low contract execution, they may have to consider shutting down their equipment. Conversely, during periods of high network activity, there might not be an adequate number of provers available simultaneously. This imbalance raises concerns about the overall stability of the network.

Furthermore, in the initial stages of the mainnet launch, when the ecosystem is relatively uncomplicated, the generation of transaction proofs is limited. This scarcity poses challenges in attracting provers to participate, thus hindering the growth of the overall ecosystem.

There are also theoretical challenges — for example, who assigns profitable proof generation tasks to provers and selects the prover to delegate to? This is especially difficult for a decentralized network like Aleo.

Considering the aforementioned factors, it is probable that Proof-of-Succinct-Work (PoSW) will predominantly serve as a mechanism for “mining” or proving in the near future, at least for the next few years. Aleo, however, aims to create value beyond just being a mining network. To achieve this, they have designed an economic model where the percentage of proving rewards gradually decreases year over year, ultimately reaching zero after a ten-year period. This approach incentivizes early participation in Aleo’s ecosystem as a prover, offering an opportunity to obtain a share of the rewards during the initial years following the mainnet launch. By doing so, Aleo aspires to create a sustainable and valuable ecosystem beyond the mining aspect.

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