Tezos Activates Ithaca 2: Here’s What Has Changed
April 1st, Tezos activated Ithaca 2, thus bringing about the new consensus algorithm Tenderbake, changes for bakers, and operation pre-checks.
In this post, we’ll talk about how Ithaca 2 impacts users, developers, and bakers.
Tenderbake: Tezos Is Now Even Faster
TL;DR: The network confirms transactions faster; block time can be shortened further.
A consensus algorithm is a set of rules that blockchain nodes use to coordinate actions and achieve results. To add a new block to the chain, most miners must validate it, i.e. reach consensus.
The popular Proof-of-Work and Proof-of-Stake algorithms are probabilistic. There is always a chance that miners will simultaneously create several blocks with the same height (ordinal number) and a different set of transactions, and then discard all but one. The more blocks appear “above” a particular block, the less likely the transactions are to be discarded. That’s why many applications don’t count deposits on a transaction included in a block until the miners have created several new blocks and the probability of cancellation drops to a minimum. For example, transactions in Tron are considered confirmed after 20 blocks.
The old Tezos Emmy* consensus algorithm was probabilistic, while the new Tenderbake algorithm is deterministic. According to the Nomadic Labs team’s calculations, bakers are guaranteed not to discard a transaction after 2 blocks. That is, any transaction will be confirmed in one minute, not 5-6 like earlier. In addition, Tenderbake will further reduce block time.
For more details on Tenderbake, refer to our post about sharks and optic fibre.
Updated Baking: No More Rolls
TL;DR: bakers with small deposits will earn more and get rewards straight away.
The Ithaca 2 update reduced the minimum stake size from 8,000 tez ($32,000) to 6,000 tez ($24,000). This will allow more users to become bakers and contribute to the decentralization of the network.
Rolls are no more. Previously, the Tezos network considered a baker with 15,999 tez to have only one roll, which means the same chance of mining or confirming a block as a baker with 8,001 tez. The network now calculates the odds based on the number of tez on the balance. In addition, the number of block confirmation slots has increased from 256 to 7000, i.e. bakers with small deposits will now be receiving rewards more consistently.
Baking and endorsing rewards are now awarded instantly. Before that, Tezos used to freeze them for 5 cycles, about two weeks.
For public bakers, the insurance deposit and over-delegating mechanisms have changed. Bakers no longer pay a fixed amount of security deposit for each block mined or confirmed but freeze 10% of the stack before the cycle begins.
Other Changes in Ithaca 2
Tezos introduces transaction prechecking: nodes distribute information about transactions as they occur rather than post-factum. The network comes to a consensus on transactions and smart contract calls faster, which means developers will be able to optimize the Tezos network and increase its throughput.
And the liquidity baking has also continued until block number 3,063,809, tentatively until January 2023.
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