Behind Blockchain: Byzantine Generals Problem

Blockchain is the powering force that enables bitcoin and other cryptocurrencies to accomplish task using two unique features:

1. Decentralized governance
2. Network trust mechanism

Decentralized governance illustrates ability of network to have no central issuing authority and removes vulnerability of the system from external attack. Further the network should have in built trust mechanism between different points of transaction enablers. I stumbled upon an article that describes how this two conflicting constraints are synchronized to achieve objective in form of a story (http://pages.cs.wisc.edu/~sschang/OS-Qual/reliability/byzantine.htm)

“The Byzantine Generals Problem” is a problem in which several divisions of an army under leadership of different generals are planning to coordinate their attack and occupy a castle. However, some of the generals are traitors and tries to weaken the attack by communication. The important form of action for each general is the information they receive. Thus the objective is to ensure that all generals receive the same information. The above problem is also reduced to a single general and multiple lieutenants’ problem.

Mathematically speaking the castle will not be occupied if loyal generals are less than or equal to two-thirds of total number of generals. The essential component is the manner in which messages are communicated for meeting the objectives. Generally, commanders are traitors if they wait after receiving order to attack. There are three ways of communication between and within army divisions:
I. A solution with oral messages – No signature: It can be solved if less than one third of generals are traitors
II. A solution with signed messages: Verifying authenticity of a general’s signature, possibly using digital signatures. It can be solved if at least two generals are loyal.
III. Missing communication paths: Configuration of network allowing communication among generals. Again here, it can be either oral or digital communication and possible solution is to have digital communication in subgraph of loyal generals

The traitors in army are analogous with middlemen in financial transactions, and blockchain eliminates the effect of them for a secure transaction with a cryptic digital signature.