# Protocol Design - Spam, Work, & Prioritization¶

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## Spam resistance¶

A spam transaction is loosely defined as a block broadcasted with the intent to saturate the network, reduce network availability, or increase the size of the ledger. In order to make spam more costly, each valid block in Nano requires a proof-of-work (PoW) solution to be attached to it - similar to the original Hashcash proposition1. Participants can compute the required work in a few seconds, and verification time for this work is negligible (to prevent invalid blocks, large work, and/or invalid work from becoming a denial-of-service attack vector). The cost of spamming the network then increases linearly with the number of spam transactions, reducing the impact of spam from theoretically infinite to a manageable amount.

In addition to proof-of-work, another key component of Nano's defense against spam is transaction prioritization using a round-robin balance-bucket system, combined with least-recently-used (LRU) prioritization within those buckets. This system ensures that spam does not prevent legitimate users from making transactions & achieving fast confirmation, which in turn removes some of the incentives to spam (e.g. network disruption). See the prioritization details & prioritization buckets sections below for more information. While prioritization can be considered a "Node Implementation" topic, it's included in this "Protocol Design" discussion due to its relevance to spam resistance.

## Work algorithm details¶

Every block includes a work field that must be correctly populated. Valid work is obtained by randomly guessing a nonce such that:

H(\text{nonce} || \text{x}) \ge \text{threshold}

where $H$ is an algorithm, usually in the form of a hash function, $||$ is the concatenation operator, $threshold$ is a parameter of the network that relates to the resources spent to obtain a valid work, and $x$ is either:

• The account's public key, in the case of the first block on the account, or
• The previous block's hash

The following image illustrates the process by which valid work is obtained for Block 2.

The work field is not used when signing a block. This design has two consequences:

1. A block can be securely signed locally, while the work is requested from a remote server, with larger resources. This is especially important for devices with low resources.

2. Since all inputs are known before generating a block, a user can precompute the work for the next block, eliminating any time between creating and broadcasting a block. After a block is created, the next block's work can be computed immediately, using the last block's hash as input.

## Choosing an algorithm¶

While the specific algorithm used is an implementation decision, there is a minimal set of requirements that must be met for compatibility with the Nano protocol.

1. Asymmetry. Verifying work should take the least amount of resources (including time) as possible.
2. Small proof size. Work should take a minimal amount of a block's size compared to the resources required to generate it, in order to reduce overhead and maximize throughput.
3. Amortization-free. The cost of obtaining work for multiple blocks should scale linearly with the number of blocks. This ensures fairness for all participants.
4. Progress-free. Any attempt at obtaining work should follow a stochastic process, with no dependence on previous attempts.

Additional requirements of parameter flexibility, constrained parallelism, and being optimization-free, are desired but not required 2.

## Prioritization details¶

As of V24, Nano representatives rotate (round-robin) through 62 balance-based buckets when voting on transactions, and the least-recently-used (LRU) accounts in each bucket have the most priority (within their bucket). For example, if an account with 1 XNO and another account with 5 XNO both make two transactions, Nano representatives will vote on one transaction from the 1 XNO bucket, and one transaction from the 5 XNO bucket, before voting on a second transaction from the same bucket. Furthermore, the least-recently-used account within a bucket has the most priority (in that bucket), so after an account makes a transaction it gets moved to the back of the line behind everyone else (in that bucket). This means that if an attacker tries to send thousands of transactions from an account that only has 0.00001 Nano (for example), other accounts in the 0.00001 bucket that don't make frequent transactions will have priority over the spam, and the 0.00001 bucket spam will have no impact on accounts in other balance-buckets (e.g. 1 XNO).

Balance-based Buckets

Prioritization buckets are split by account balances, not transaction amounts

Prior to V24, there were 129 balance buckets4, with the majority (89) of those buckets being for balances under 0.0003. Since most legitimate users tend to have balances larger than that, this meant that most of the balance buckets were minimally used. In V24 however, there are now 62 balance buckets35, & account balances under 0.0003 all share the same bucket. This means that there are a lot more buckets for typical real-world account balances now, which helps prioritize legitimate transactions over spam.

## Prioritization buckets¶

Here are the 62 balance buckets in the reference node implementation, based on the V24 source code3.

Bucket Number Bucket Region (uint128) Bucket Range (Nano) Bucket Range (Raw)
Bucket 0 0 - 2^88 0.0 - 0.0003094850098213451 0 - 309485009821345068724781056
Bucket 1 2^88 - 2^92 0.0003094850098213451 - 0.002630622583481433 309485009821345068724781056 - 2630622583481433084160638976
Bucket 2 2^88 - 2^92 0.002630622583481433 - 0.0049517601571415215 2630622583481433084160638976 - 4951760157141521099596496896
Bucket 3 2^92 - 2^96 0.0049517601571415215 - 0.023520860746422224 4951760157141521099596496896 - 23520860746422225223083360256
Bucket 4 2^92 - 2^96 0.023520860746422224 - 0.042089961335702926 23520860746422225223083360256 - 42089961335702929346570223616
Bucket 5 2^92 - 2^96 0.042089961335702926 - 0.06065906192498363 42089961335702929346570223616 - 60659061924983633470057086976
Bucket 6 2^92 - 2^96 0.06065906192498363 - 0.07922816251426434 60659061924983633470057086976 - 79228162514264337593543950336
Bucket 7 2^96 - 2^100 0.07922816251426434 - 0.22778096722850996 79228162514264337593543950336 - 227780967228509970581438857216
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