Erlay protocol support signaling has successfully merged into Bitcoin core to change the transaction relay protocol of the network.
Bitcoin has gained the top position in the crypto market by grabbing the attention of investors through its overwhelming return on investment (ROI). Since its inception, several protocols have emerged to drive the Bitcoin network further by adding more valuable integrations to the growth of Bitcoin. Erlay is one of those protocols, as it now aims to significantly reduce the bandwidth that is required to connect Bitcoin nodes.
Erlay: A New Bitcoin Transaction Relay Protocol
According to research conducted by Gleb Naumenko and prominent crypto experts like Gregory Maxwell and Peter Wuille, Erlay has the ability to reduce the amount of bandwidth required to sustain the connectivity between Bitcoin nodes by nearly 40%. Erlay acts as a catalyst to uplift Bitcoin’s p2p layer and increases security and connectivity.
The proposal recommends an innovative way to transmit transaction identifiers more efficiently, significantly reducing the number of messages sent between nodes while still supporting the transmission of new transactions to all nodes. The research paper states, “The security of the Bitcoin network depends on connectivity between the nodes. That means that higher connectivity yields better security.”
The protocol further said, “The set reconciliation protocol uses error correcting codes to communicate a set of transactions to a peer with an unknown but similar set using bandwidth only equal to the size of the difference and not the size of the sets themselves. Results: we save half of the bandwidth a node consumes, allowing for increased connectivity almost for free – and, as a side effect, Bitcoin can better withstand timing attacks.”
Erlay Brings An Elegant Solution
On 26 September 2019, Pieter Wuille and Gleb Naumenko officially published a BIP (Bitcoin Improvement Proposal). The implementation of the proposal would allow nodes to start relaying transactions using the Erlay protocol. However, it almost took three years to get the proposal approved and implemented. Erlay will now bring material bandwidth efficiency gains to bitcoin’s peer-to-peer layer, which will make the network smoother and more convenient to run full nodes — particularly for those individuals living in areas with poor internet connectivity.
Erlay protocol will strengthen Bitcoin’s peer-to-peer layer by allowing more node operators to participate in Bitcoin’s network validation by eliminating the barrier to entry with reduced internet bandwidth so people can find it easier to run a full node. The protocol makes the network more reliable by accelerating the connectivity between nodes and more encrypted by making it challenging for hackers and attackers to identify the node and get a loophole from which a transaction is generated.
This process is executed in two steps. In the first step, nodes will send newly generated transaction IDs to their peers, as usual. However, they can share it with a maximum of eight peers even if they have more. In the second step, nodes request a “sketch” from their shared peers. Such a sketch contains keys for all of the transactions a node has shared with peers (since the last reconciliation) but in a more compact form.
Through sketches, a node can identify the dissimilarity of transactions using peers. Then, nodes can request only those transactions from those peers that don’t appear in their sketch. This way, the network consumes less bandwidth than sharing all of the transaction IDs at once.
Final Words
The crypto winter has plunged several cryptocurrencies hard to the bottom line in the price chart, snatching away the investment dreams and interest of investors from the crypto market. Amid this bearish market, protocols like Erlay aim to revolutionize the Bitcoin network by making it more approachable and profitable, eventually gaining market attention. It is expected that Bitcoin’s fundamentals will drastically improve in the future following the enhancements.
