Burn Proof ( PoB ) Protocol Introduction

Recently, the Iagon team developed a burn proof ( PoB ) protocol suitable for the Cardano ecosystem in response to the questions raised by Charles Hoskinson. This article will introduce this solution, covering the main content including:

1. Overview of the Proof of Burn Mechanism and Its Applications
2. The PoB solution of Iagon implemented on the Cardano network
3. Deployment and Testing of Smart Contracts
4. Execute the PoB protocol by sending tokens to the "black hole" address.

1. Burn Proof and Its Applications

The burning of cryptocurrency tokens essentially involves sending the tokens to an inaccessible "black hole" address. This process is verifiable, but only the committed value is known. The burning mechanism can be used to increase the value of the remaining tokens or as a proof of commitment for the blockchain protocol.

The security of the proof of burn is based on cryptographic hash functions. These functions are easy to compute but difficult to reverse engineer. By flipping the least significant bit of the hash function output, a black hole address can be created, and funds sent to that address will be unrecoverable.

2. Proof of Burn Smart Contracts on the Cardano Network

Cardano smart contracts consist of three components:

• Redeemer script: controls the spending of eUTxOs
• Wallet Script: Represents user execution, used for redeeming funds and creating new eUTxOs
• eUTxOs: holding funds and data points

There are four possible operations for Cardano smart contracts:

• Burn: Send funds to the black hole address
• Destroyed: Verify that the burn has indeed occurred
• Lock: Send funds to an address with a key
• Redemption: Redeem locked funds

Intermediaries cannot distinguish between burn and lock transactions, which prevents scrutiny of burn transactions.

3. Deployment of Smart Contracts

The deployment steps of the smart contract include:

1. Install Haskell toolchain
2. Build Plutus script
3. Start Cardano node and wallet container
4. Restore wallet and obtain wallet ID
5. Execute token burn operation
6. Verify Burn

4. From Smart Contracts to Wallet Scripts

By using only wallet scripts, further prevention of scrutiny on burn transactions can be achieved. This method requires replacing the public key hash with the hash of the commitment value and flipping the least significant bit. The structure of Cardano addresses and CRC checksums also need to be taken into account.

Overall, the PoB solution proposed by the Iagon team provides an uncensorable token burning mechanism for the Cardano ecosystem, contributing to ecological development. With the improvement of relevant infrastructure, it is expected that more complex and secure smart contract solutions will be achieved in the future.