Loki’s Trusty Tyr Hardfork is now live, and with it comes a new feature: Checkpointing. While many of you will be familiar with this concept (especially if you read LIP-3), some of you may not, so here’s a quick explainer in simple terms.
Checkpointing is a process in which blocks (containing transactions) in a blockchain are locked by Service Nodes. For Loki, the blockchain is checkpointed every four blocks, or approximately every eight minutes. Once two consecutive checkpoints are placed, the blockchain history prior to those checkpoints cannot be changed.
Checkpointing is important because it prevents 51% attacks: a scenario in which a miner, or group of miners, gains control of 51% of the hash power of the entire network. With this control, attackers can produce a longer chain of blocks than the current chain, and force the protocol to switch to their chain. That is, from a chain which the network believes is true, to an alternate chain with potentially malicious intent. For example, with an alternate chain attackers could prevent new transactions from being confirmed, delay payments from some or all users from being received, render previous transactions invalid, and reverse transactions in order to double-spend.
While 51% attacks are unlikely for larger market cap coins like Bitcoin or Ethereum (although hypothetically possible) due to the extremely high costs of gaining the required amount of hash power, it’s within the realms of possibility for smaller market cap coins like Loki. In comes Checkpointing to the rescue! Because Service Nodes lock a block every four blocks, an alternate chain containing conflicting transactions to the previous two checkpointed blocks will be rejected. In other words, as long you wait for two checkpoints to be placed, you will always be safe to accept funds, without needing to worry that the transaction might be reversed.
Loki Checkpointing adds an additional layer of security to our products, so you can trade and communicate with absolute freedom…and peace of mind. For a live feed of the latest blocks being checkpointed, go to https://lokiblocks.com/checkpoints.