Proof of Burn¶
Koinos uses Proof of Burn (PoB) to select and validate block production. Participants permanently burn KOIN through the PoB system contract and receive Virtual Hash Power (VHP). VHP represents production power; it is not ordinary spendable KOIN.
Burning KOIN is an irreversible transaction. This architecture page explains the relationship without providing executable burn or producer-registration instructions.
From KOIN to effective VHP¶
The PoB contract burns KOIN and mints the corresponding amount of VHP. The VHP contract tracks both the token balance and the amount considered effective for consensus.
Transfers of VHP are subject to an effectiveness delay. This prevents the same production power from being moved rapidly between accounts and counted more than intended.
Block eligibility¶
For each production opportunity, Block Producer obtains current consensus metadata from Chain and creates a verifiable random function (VRF) proof. The protocol evaluates that proof using the producer's effective VHP and the current difficulty.
More effective VHP increases the probability of satisfying the target, but it does not reserve a deterministic sequence of blocks. A candidate that satisfies the production condition is still submitted to Chain and must pass normal block validation.
flowchart TB
KOIN["KOIN"] -- "irreversible burn" --> VHP["VHP"]
VHP --> Effective["Effective VHP"]
Metadata["Consensus metadata"] --> Proof["VRF proof and target check"]
Effective --> Proof
Proof --> Candidate["Candidate block"]
Candidate --> Chain["Chain validation and fork choice"]VHP consumption and replenishment¶
Successful production consumes a protocol-calculated amount of VHP. A producer therefore cannot assume that one initial KOIN burn provides permanent production capacity. Producers may need to replenish VHP over time to maintain their intended production power.
Consensus parameters and current balances are on-chain state and can change. Architecture documentation should not embed historical burn amounts, difficulty values, inflation percentages, or expected returns.
Separation of responsibilities¶
- The PoB and VHP system contracts implement the consensus-specific token and eligibility rules.
- Block Producer constructs proofs and candidate blocks.
- Chain validates the proof, executes the block, and applies fork choice.
- P2P propagates accepted blocks to other nodes.
Producer keys, public-key registration, VHP acquisition, resource readiness, and monitoring belong in the reviewed block production guide. Privileged contract details belong in System Contracts.