Understanding finality in blockchain
Finality in blockchain means reaching a point where a transaction is permanent and irreversible. Once a transaction achieves finality, it’s locked in and cannot be altered or undone. This is crucial in maintaining trust in blockchain systems, as it guarantees that transactions are secure and records remain immutable.
Think of blockchain finality like wet cement. When you first pour cement, you can still make changes — move it, shape it, or even erase a footprint.
But once it hardens, it’s set in stone, and no one can alter it. Similarly, a blockchain transaction starts as “wet cement” during the confirmation process. Once the network reaches consensus and finality is achieved, that transaction is “hardened,” becoming permanent and unchangeable.
There are two key types of finality: transaction finality and state finality. Transaction finality refers to the point when a specific transaction is confirmed and cannot be reversed. For example, on Bitcoin, a transaction is generally considered final after six confirmations — i.e., six new blocks added to the chain.
State finality, on the other hand, focuses on the entire blockchain state, ensuring that every part of the system reflects an agreed-upon status, which is vital for smart contracts and decentralized applications (DApps).
Did you know? Sei Network boasts one of the fastest transaction finality times, achieving finality in under 400 milliseconds, thanks to its Twin-Turbo consensus mechanism. In contrast, Bitcoin has one of the slowest finality times, with transactions typically considered final after approximately 60 minutes due to its design and block confirmation process.
Types of blockchain finality mechanisms
Blockchain finality mechanisms determine how and when transactions are considered permanent. These mechanisms differ depending on the consensus protocols used.
Here’s a breakdown of the most common types:
Probabilistic finality
Probabilistic finality is typical in proof-of-work (PoW) systems like Bitcoin. In these networks, transactions become increasingly secure as more blocks are added to the chain. Each new block reinforces the validity of previous transactions, making it exponentially harder for someone to rewrite the blockchain’s history.
Imagine stacking bricks to build a wall. With each brick added, it becomes more difficult to remove or alter the lower ones without dismantling the entire structure. Similarly, in PoW systems, finality isn’t instant but becomes more certain with time, usually after six confirmations.
