Microsoft Unveils New Proof-of-Authority Algorithm

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Microsoft Unveils New Proof-of-Authority Algorithm

Microsoft’s recent announcement of launching Ethereum on Azure might be one of the biggest, a most potent sponsorship of a particular blockchain in the history of this technology. Additionally, the tech giant also announced a new algorithm for it, called Proof-of-Authority, or PoA.

About Proof-of-Authority and Ethereum on Azure

Ethereum on Azure is a so-called BaaS (Blockchain-as-a-Service) product, which allows companies to configure and deploy Ethereum’s own blockchain network in a matter of minutes. The announcement by Microsoft states that the new algorithm, Proof-of-Authority, will allow the creation of dApps on ETH network. This is a big move, especially due to the fact that the ETH network is not secured by PoW.

According to Azure Global’s software engineer, Cody Born, the PoW is the algorithm that is best suited for blockchains where participants do not exactly trust one another. Through the use of computation costs, this algorithm would allow the network to self-regulate. This makes it perfect for open, anonymous networks, but it loses its value in the consortium and private networks. This is why the appearance of Proof-of-Authority for Ethereum is a big and important development for this network.

According to the model that Microsoft has presented, each of the consensus nodes will have its own identity on the Ethereum’s network. Also, all users of the network will have the ability to delegate their votes if something was to happen to their primary node. That way, everyone will have the ability to continue to participate in everything that is going on within the network.

The announcement also revealed that Microsoft’s product will come with a dApp by the name of ‘Governance dApp’. Its purpose is to make the process of voting simpler, and it will allow each member of the network to manage their own keys themselves. This comes as Microsoft’s way to provide members with more security, and to make signing into wallets easier.

This dApp is also expected to provide the network with decentralized governance due to the fact that all changes will be made through voting on the blockchain itself. That way, all new developments will be transparent, and entirely community-driven. Additionally, Microsoft decided to enable web-assembly support provided by Parity. This will allow developers to use programming languages other than Solidity, which will make smart contracts creation more accessible to those who are not familiar with Ethereum’s own programming language.

Possible implications

The introduction of Proof-of-Authority is expected to have a potentially large impact and might lead to multiple implications. For example, the publication and even development of future dApps might include things like employee compensation, electronic voting, overseeing the supply chain, agreements enabled via smart contracts and more.

IOTW’s head of business development, Kartik Mehrotra, commented on this and said that the change might end up simplifying numerous tasks for companies. It might also allow them to focus more strongly on their own core activities. Doing so would certainly enhance their key skills, not to mention revenue. Finally, the new partnership will lead to competition with already existing company blockchains and future ones alike.

Another interesting development regarding Microsoft is its recent partnership with ICE. Together with other companies, including Starbucks, Microsoft joined ICE in creating a new platform called Bakkt, which is expected to help boost the adoption of BTC. However, despite Microsoft’s new crypto-friendliness, its search engine, Bing, still has not removed a block on crypto ads that were introduced earlier this year.