By Lin Oshitani
Why Self-Amending Blockchains?
Blockchains have a problem — It is hard to implement major upgrades. Fundamental changes are possible through socially coordinated hard forks, but this method has several issues:
- There is a technical risk of a temporary network split due to incompatible nodes running in the network.
- There is a social and economic risk of a permanent network split due to the lack of a formal process for resolving disagreements.
- It is unclear who has the final say. The core devs? The stakeholders? Or people with the loudest voice?
This difficulty in updating blockchains hinders their ability to integrate innovations, leading to technical stagnation. What we need is a chain that can seamlessly evolve while minimizing technical and social risks.
And from this need, Tezos, the self-amending blockchain, emerged.
What are Blockchains?
What are “self-amending blockchains”? To understand what they are, we must first take a step back and revisit what blockchains are in abstract terms.
The Apply Function
At the core, blockchains consist of a state, blocks, and an apply function:
Chain of applies
The Score Function
To achieve this consensus, we introduce a score function:
Using this function, the network can reach a consensus on which block to build upon, allowing the branching of the chain to eventually converge.
What are Self-Amendments?
So far, we have seen what “blockchain” means in “self-amending blockchain”. Now, what does “self-amending” mean?
What does “embed the protocol into the state and replace it with apply” mean? Below is an illustration of this process:
Since the definition of how the blockchain execute blocks has changed, we can say that the blockchain has been upgraded.
This section briefly looks into the current Tezos amendment cycle (“current” because, as we have seen above, we can amend the amendment cycle itself).
The cycle consists of five stages:
- Anyone who is a baker can propose a new protocol or vote on an existing protocol proposal.
- The proposal can optionally include inflation funding - a piece of code within the proposal that mints new XTZ and grants it as a reward for their work. For example, the Lima amendment included such a proposal.
- The proposal with the most votes will advance to the next exploration stage.
- The proposal is voted on to determine if it should be adopted in the testnet.
- If it collects enough votes, it advances to the cooldown stage.
- A testnet with the proposed protocol is created for testing.
- The proposal is voted on to determine if it should be adopted in the mainnet.
- If it collects enough votes, the protocol proceeds to the adoption stage.
- At the end of the adoption stage, the protocol self-amends by replacing the mainnet protocol.
Example: Proposal stage
To better understand what is going on in these stages, let’s take a deeper look into the first “proposal” stage as an example:
History of Tezos Self-Amendments
Tezos has been able to self-amend itself 3~4 times a year. For example:
- The February 2021 Edo upgrade introduced protocol-level support for fungible/non-fungible tokens and Z-cache’s sapling.
- The April 2022 Ithaca upgrade introduced deterministic finality by hot swapping the consensus algorithm from Nakamoto consensus to a Tendermint-like BFT consensus. (blog post).
- The April 2023 Mumbai upgrade introduced Smart Optimistic Roll-Ups (also known as SORU), which are enshrined rollups (rollups directly supported by the L1 protocol), allowing anyone to deploy fully permissionless WASM rollups (blog post).
As you can see, Tezos has been able to make fundamental and drastic upgrades at a rapid pace.
Tezos is an abstract blockchain.
Tezos is a recursive blockchain.
The self-referential nature allows Tezos to embed the protocol upgrade logic within the protocol itself. By minimizing the need for off-protocol coordination during upgrades, Tezos can evolve continuously and seamlessly.
Tezos is an on-chain governed blockchain.
Tezos upgrades its protocol through on-chain proposal and voting. Therefore, the final decision-making power has shifted from the developers to the stakeholders.
Tezos is an evolving blockchain.
Blockchains are in their early stages, with their usages and technological innovation vastly unknown. More than what can be done now, the most important thing is the potential for evolution.
- L.M Goodman. Tezos – A self-amending crypto-ledger White paper
- L.M Goodman. Tezos: A Self-Amending Crypto-Ledger Position Paper
- Arthur Breitman. Tezos, decentralized cryptographic governance through self-amendments
- Victor Allombert, Mathias Bourgoin, and Julien Tesson. Introduction to the Tezos Blockchain