Dfinity: Inside the blockchain nervous system of the 'World Computer'

The technology stack used to create business systems today was formed by commercial forces rather than grand technical visions. On the one hand vendors of software and infrastructure want to lock businesses into their respective ecosystems through proprietary features and complexity while on the other developers are happy to learn the ropes and become indispensable. Consequently business systems today often resemble custom "Rube Goldberg" machines that are expensive to develop and maintain while also being fragile and insecure.

Inspired by Ethereum, the Dfinity "World Computer" aims to host the world's business logic and data using an open blockchain that can securely increase its capacity with demand. Conceived as a far superior platform for business systems, it will also host specialized decentralized apps, decentralized finance, social media and large scale "open source businesses" that compete with traditional intermediaries like eBay and Uber.

Back in 2015, Dominic Williams, founder and president of Dfinity, had an idea about generating random numbers in a decentralised network with cryptography and then using those random numbers to drive other protocols. It seemed like a principle he could use to create a world computer that would be very highly performant and secure.

Williams said: "It's not just about creating a new generation of decentralised systems, our aim is also to knock 80% off the cost of developing and maintaining traditional business systems and compete with today's IT stack, which we think is obsolete.

"If you take a step back and look at the architecture of the traditional IT stack it's extraordinarily complex and expensive to create systems and then administer and maintain them. That might have been justified if the systems were reliable and secure but they are not, and they are not very interoperable either."

As well as being a "World Computer", Williams has described Dfinity as the "future cloud". However, he qualifies this comparison.

"The cloud moniker that we use has a little of a double edged sword; on the one hand everyone understands, 'oh it's a cloud resource', on the other hand they imagine the existing cloud, which is very different," said Williams.

"With AWS you basically rent server instances, and there are hundreds of different services you can use to assemble systems.

"The Dfinity system is just a single computer, a giant virtual computer, which everybody shares. The advantage of everyone sharing the same computer is they can interoperate much more easily. Because it's an unstoppable and tamperproof blockchain computer, the development and maintenance of hosted systems can be vastly simplified."

At the heart of Dfinity is an innovation called Threshold Relay, a system that produces an unstoppable, unmanipulable and publicly verifiable sequence of random numbers from a chain of "threshold" cryptographic signatures. Combined with another protocol this has been demonstrated producing transaction finality over the Internet 600 times faster than today's Ethereum, for instance.

In threshold cryptosystems, in order to sign a message, the outputs of several parties in a group (a threshold) must be combined. Dfinity uses the Boneh-Lynn-Shacham (BLS) signature scheme. "Dan Boneh is director of the Stanford Computer Security Lab and Ben Lynn works for us, after joining from Google," said Williams.

The Dfinity network also incorporates an algorithmic governance system known as the "Blockchain Nervous System" that performs numerous roles through helping to fix broken business systems, optimizing network economics, upgrading the network protocol and actively adapting network structure to better distribute load across its supporting mining nodes.

To mine on the Dfinity network you must add "nodes", or special computers that have some minimum amount of processing and storage capacity. Each node requires a mining identity that is created by making a deposit, which is variable and determined by the governance system.

"A constant process of competition to get mining rewards wastes a lot of money and is probably unjustifiable," said Williams. "With the Dfinity network the governance system decides when it wants more nodes and will use the random number system to select some and say, right your mining identity is active, you can go live.

"Threshold Relay begins with a group signing the genesis block to produce an initial random number, which then selects the next group, which creates a new number by signing the previous signature, and so on, ad infinitum."

At any one time there will be some number of active "threshold" groups comprising 400 randomly selected nodes each. Dfinity sets the threshold at 201 so that just over half a group must be operating correctly to produce a signature.

"The beautiful thing about BLS is that the signatures are unique and deterministic, which makes random number production unmanipulable. It doesn't matter from which 201 of the group you collect signature shares, when you combine them, you will always get exactly the same threshold signature out," said Williams.

Since the signature shares can be broadcast over the network and combined in any order, it is possible for the entire network to agree on the sequence of random numbers produced without running a consensus protocol. Other protocols are then driven by these random numbers, including Probabilistic Slot Consensus, a blockchain protocol that uses the groups to "notarize" new blocks with signatures that is far faster and more secure than anything seen before, noted Williams.

"The system is highly resilient. Imagine you have a network of 10,000 mining nodes and let's say 3,000 of those are controlled by some adversary. If you select a group of 400 nodes randomly, in order for it to be prevented from producing a random number, the adversary would have to control 200 or more, because you need 201 to co-operate.

"You can calculate the probability of that happening using something called hypergeometric probability. It's about ten to the minus 17, which means in layman's terms, if you wait for it to happen, the heat death of the universe will occur first."

Dfinity is a well-funded operation with a large team of research scientists and engineers that is currently doing an institutional round. Williams said he has been under a lot of pressure to do an initial coin offering (ICO) and originally he had been promising to run one towards the end of this year.

He said: "The reason we haven't is mainly because there have been so many dubious ICOs that we don't want to be associated with the whole thing." Kudos.