On July 4, AMIS Technologies, a blockchain infrastructure development Taiwan company, announced a new Ethereum-based consensus algorithm.
Is an open-source blockchain-based distributed computing platform featuring smart contract functionality, which facilitates online contractual agreements
The algorithm is a major breakthrough in the consensus algorithms for Ethereum and it will be incorporated into J.P. Morgan's private Ethereum-based platform Quorum. As the developers claim, it will allow the platform, and any other platform that uses the algorithm, to handle more transactions per second.
The collaboration between AMIS, J.P.Morgan and the Ethereum community
Distributed database that is used to maintain a continuously growing list of records, called blocks
Alex Liu, CEO of AMIS, contrasted the classic Proof-of-Work method with the new protocol, arguing that "compared to Proof-of-Work (‘mining‘) that is currently in use in many blockchains worldwide, PBFT represents an important step forward in many ways" as "it ensures settlement finality, it speeds up settlement time to under 1 second from the current tens of seconds to tens of minutes, and it reduces energy consumption dramatically". According to Alex Liu, "for the consortium blockchains that most financial institutions are looking to deploy, PBFT represents the only way forward in consensus algorithms."
The algorithm will make Quorum more accessible to institutional users, by introducing PBFT (Practical Byzantine Fault Tolerance), which can scale to their needs by handling a greater transaction load. Go-ethereum client's pluggable consensus engine, a model that is adaptable to different consensus protocols, made it possible to bring together the PBFT protocols alongside Proof-of-Authority consensus, allowing for wide adoption among various application scenarios with differing practical needs.
Julio Faura, head of blockchain R&D at Banco Santander and chairman of the board at EEA , explained that "this is significant advancement in providing enterprises a range of 'pluggable' consensus algorithms, which is a core objective of the EEA". He also added that they are "proud to see EEA members such as AMIS not only contributing in such a meaningful way, but also in collaboration with other members such as J.P. Morgan".
Julio Faura went on to say:
Enterprise adoption of Ethereum has never been stronger, and is getting stronger everyday through efforts like these.
Chairman of the board at EEA and head of blockchain R&D at Banco Santander
Thomas Hu, CEO of Kyber Capital, one of AMIS's early investors, called this collaboration between AMIS, J.P. Morgan, and the Ethereum community "a great testament of the capability of AMIS and the Ethereum community to meet the mission-critical demands of global financial institutions". He also mentioned that it "establishes a new benchmark for strategic collaboration and co-creation between financial institutions and FinTech startups in global blockchain innovation."
Given that there are many consensus models, the Istanbul BFT Consensus Algorithm would be more desirable to institutions that do not want to use a Proof of Work-based consensus algorithm to confirm blocks.
AMIS continues to work with fellow EEA members including J.P. Morgan, Fubon FHC, and Taishin FHC to develop blockchain applications.