Proof of Authority (PoA)

Proof of authority (PoA) is a consensus protocol based on identifying nodes and their reputation. It was created in 2017 based on the Proof of Stake (PoS), with the requirement that instead of stake with monetary value, i.e., coins, a node’s identity is at stake. Identity means the resemblance between a node’s personal identification on the network with officially issued documentation for the same person, i.e., assurance that a node is precisely who that individual depicts to be. Nodes that append blocks in the BC are called validators. To become a validator, the node’s identity must not only be publicly known. In PoA, in case of disfavored behavior, the validator earns a negative reputation and loses the prospect of participation in the future block creation process. Nodes with a good reputation can take up the role of validating the block on a round-robin basis.

PoA provides high performance, high transaction rate, and fault tolerance. The transaction rate is high as blocks are generated in sequence at regular time intervals by only authorized nodes and the speed at which transactions are validated also increases. PoA does not require any high computing hardware like in Proof of Work (PoW). PoA tolerates malicious nodes as long as 51% nodes are not compromised. PoA can also withstand denial of service (DoS) attacks since the nodes are verified and block creation occurs at regular intervals. Since it does not confirm maintaining the user’s anonymity, it is not helpful for public BC and is useful for private BC only. Also, PoA is more inclined toward centralization rather than decentralization as it promises high throughput and scalability. PoA is used in Aura, Clique, PoA Network, and Vechain platforms.