Sustainable ZK Mining through Boundless
Delving into ZK Mining Through Boundless
Zero-Knowledge Proofs (ZKPs) have long been hailed as the ultimate solution to blockchain’s scalability and privacy issues and have driven it to a critical juncture. These cryptographic methods have driven blockchains to a critical juncture. They have significant potential in enabling trustless and decentralized verification without exposing the underlying content of the data. This enhances the privacy, security, and scalability of blockchains in general. However, ZKPs systems are highly complex and face bottlenecks in proof generation time, which impedes a sustainable economy.
Building upon the foundational concepts of Proof of Work (PoW), which underpins Bitcoin's consensus mechanism that achieved a short-term mining economy, and Aleo, which leverages ZKPs and adapts the Proof of Succinct Work (PoSW) to address issues that existing consensus mechanisms faced, like coordination issues (prover race competitions). Boundless breakthrough with the Proof of Verifiable Work (PoVW), which takes a step further in creating a sustainable mining economy by aligning incentives across users, developers, and provers. This allows blockchains to achieve their dream of transforming the global state of secure and incentivized mining.
This research paper examines how Boundless leverages ZKPs to transform ZK proving from a costly endeavor into a robust economic engine, unlocking the full potential of decentralized computation.
Proof of Verifiable Work (POVW): A New Mining Paradigm
Bitcoin’s PoW mining algorithm is the underlying groundwork for developing Boundless PoVW. In Bitcoin, a miner has to execute millions of iterations to solve the puzzle and requires a highly efficient setup that would consume approximately 155,000 kilowatt hours (kWh) of electricity to mine one Bitcoin. The SHA256 hashing function is the foundation of it all. It is a cryptographic conversion algorithm that takes any amount of text and spits it out as a 256-bit string of alphanumeric characters. However, if any part of the text is changed, the signature will change. This feature makes data validation on Bitcoin reliable and secure. Proof of Work is the cornerstone of the Bitcoin network.
In Bitcoin, solving the mathematical puzzle involves computing millions of hashing functions on the block of transactions, changing the nonce each time to try and get to the target number. If the miner meets the requirements, the block becomes eligible for the Bitcoin block reward and is allowed to add the reward to the ledger part of the block. The miner broadcasts the new block to the network, proving the work done. The Bitcoin network then validates the block’s signature and confirms the new block. Miners then add the block to the end of the blockchain, and the miner claims the block reward. Bitcoin’s PoW algorithm faced critical issues; hence, the need for a newer mining approach led to zero-knowledge mining.
While Bitcoin laid the foundation for permissionless mining, its architecture imposed constraints that Boundless fixes through its PoVW, but with significant improvements that incorporate Zero-Knowledge Proofs (ZKPs) for scalability and efficiency. In Bitcoin mining, every node in the network has to re-run every transaction logic to validate a block. While this mining model was secure and transparent, it introduced scalability issues as the network would be limited by the slowest node. The result is that blockchains like Bitcoin were designed to handle simple computations, with anything complex hitting gas limits and transactions failing.
Instead of being limited by the slowest node, Boundless harnesses the total computing capacity of all nodes. Each node generates execution proofs that any blockchain can verify without re-execution. These proofs, verified on-chain, act as building blocks for the network. With each new prover on the market adding capacity and each new application amplifying benefits, the network strengthens and scales, creating a self-reinforcing system of increasing computational power and efficiency. The table below highlights the core differences between these two mining paradigms:
The Boundless Flywheel
In the Boundless mining model, users with the appropriate infrastructure and technical prowess can become a prover, playing a critical role in the ecosystem by generating and evaluating these proofs required to fulfill requests and participating in auctions. The broader effect of this flywheel puts in motion the following:
Large proving pools reduce the unit cost of mining: Boundless contributes to the formation of larger proving pools. These pools share resources, thereby reducing the cost of proof generation.
As proving costs decrease, generating ZK proofs becomes more affordable, opening the door for new, innovative, full-stack applications that were previously hindered by expensive proof-generation costs and massive adoption.
As more applications are built on the network, activity increases, leading to more transactions, proof requests, and other interactions, which generate more fees for the protocol. These higher fees then help boost the value of the token, making it more rewarding for provers to get involved, as they benefit from the increased rewards.
As provers earn higher rewards from increased fees and token value, they're pushed to upgrade their hardware and improve their setups, which in turn lowers proving costs even further and boosts the overall performance of the system.
As this flywheel effect gains traction, it builds a self-sustaining system for provers. Lower proving costs, more network activity, and better rewards create a continuous loop that encourages provers to keep improving their setups and push the system forward. This momentum lays the groundwork for long-term sustainability, which we’ll dive into in later sections, where we'll explore how Boundless builds on Bitcoin’s proven model and solves the problems that other ZK projects faced.
An Overview of Boundless Proof Market Lifecycle
In the Boundless Proof Market, a client (or requestor) writes a program for the zkVM (Zero-knowledge Virtual Machine) and generates a cryptographic proof (seal) of its execution. The requestor then submits a proof request to the market, specifying the program, input, and an offer with a price range. The request is broadcast on-chain or off-chain, initiating a reverse Dutch auction. Provers place bids, locking in the request with a stake. Once locked, the prover executes the program, generating an aggregated proof for the request. This proof is submitted to the market contract, where it's verified before releasing the reward and returning the prover's stake.
The prover submits an aggregated proof, merging multiple proof requests into a single Merkle tree structure. This reduces storage costs and optimizes verification by compressing multiple proofs into a single, efficiently verifiable unit. Upon successful verification, the requestor receives the proof, which consists of the journal (output) and the seal (Merkle inclusion proof). The requestor can then use the proof in their application, ensuring the program’s correct execution. This decentralized, auction-based process connects requestors with provers, enabling efficient, scalable, and secure proof generation.
In the Boundless market, the key participants include:
Requestor (Client): Submits proof requests to the Boundless market, specifies parameters (program, input, price), and retrieves the proof upon completion.
Prover: Bids on proof requests, locks the request by staking, generates and submits the aggregated proof for execution, and receives rewards upon successful verification.
Verifier Contract: Verifies the cryptographic validity of the proof and confirms the program's execution according to the requestor's specifications.
Sustainable Incentives: From Bitcoin to ZK
Bitcoin achieved a short-term incentivization economy through a combination of its architecture design, fixed issuance schedule, increasing difficulty in solving blocks by miners, and some market-driven efficiency improvements. All these ensured that the mining rewards miners received remained valuable. Over time, miners pushed the boundaries by optimizing their operations to reduce costs and improve performance while earning more block rewards, which contributed to Bitcoin’s security and decentralized nature. As Bitcoin scaled, it faced critical issues: increased centralization in mining operations due to the rising hardware costs and energy consumption. This led to the rise of centralized, large-scale mining farms, whose sole purpose was to earn the most block rewards possible, and this undermined the decentralized ideal of blockchains. Furthermore, Bitcoin’s reward structure began to face challenges with inflation concerns and sustainability, especially as block rewards began to halve over time, placing pressure on miners as they were forced to adapt to remain profitable; transaction fees became part of miners’ earnings. The challenges faced by past systems highlight the need for a more economically aligned ZK infrastructure.
To combat Bitcoin’s limitations, Aleo began exploring new approaches and hence fell to redesigning Bitcoin’s PoW mechanism to Proof of Succinct Work (PoSW). In Aleo’s case, the mining process involves provers (or miners) who perform complex computations and generate zk-SNARK proofs to validate their work without revealing the data. Provers then generate succinct, verifiable cryptographic proofs that confirm the correctness of their computations. These proofs are then submitted to the network and are verified by validators without needing to re-execute the full computation. Miners are then rewarded for generating valid zk-SNARK proofs. Despite Aleo’s new approach and designs, it fell short and faced challenges around prover race conditions, where multiple provers end up competing to create the same proofs, wasting resources. This problem arose because of the misalignment of incentives, which failed to support long-term economic sustainability.
Why Boundless Incentives Work Long-Term
Boundless addresses key design flaws in Bitcoin and Aleo through its structured market, incentivizing provers to optimize their operations and reduce inefficiencies, ensuring a more predictable and sustainable proving environment. The auction model establishes a competitive pricing system that benefits both provers and clients, driving further network adoption as more provers join and participate in the system, which in turn fuels the overall ecosystem's growth.
In addition to solving race conditions, Boundless also aligns incentives and fosters community engagement through unique strategies like memes. By tapping into trends, Boundless creates an engaging environment that motivates retail participants to spread awareness and actively participate in the ecosystem. Boundless further supports long-term participation by providing clear documentation, full-stack developer tooling, and community-driven resources. These make it easier for developers to build, test, and deploy applications on the platform, encouraging the creation of more innovative use cases that drive demand for proving services. With these combined efforts, Boundless creates a sustainable ecosystem where the market is efficient, incentives are aligned, and both developers and users can thrive.
Conclusion
The overall objective of Boundless is to establish an economically stable proof system that can support long-term growth and widespread adoption. Boundless accomplishes this by introducing PoVW, creating a self-sustaining market. This ensures fair competition and long-term economic sustainability. While Boundless is still in its early stages, its innovations lay the groundwork for a more efficient and decentralized proving ecosystem. As adoption grows, we anticipate that Boundless will unlock new full-stack applications, lower proving costs, and attract a wider range of participants, driving the next evolution of blockchain scalability and composability.