What is finality in blockchain, and why does it matter?

Understanding finality in blockchain

Finality in blockchain refers to the unchangeable confirmation of a transaction or a block of transactions.

In conventional financial systems, once a transaction is confirmed, it cannot be undone. Similarly, attaining finality on a blockchain network ensures that a transaction is permanent and cannot be modified after it has been added.

In PoS, validators or nodes are required to provide a stake as collateral, a specific quantity of cryptocurrency. If they approve fake transactions, they run the risk of losing their stake, making it economically irrational to act maliciously.

TYPES OF FINALITY

Instant finality

The Ripple network offers near-instant finality, ensuring that once a transaction is recorded on the ledger, it is immediately confirmed and irreversible. Transactions are validated by 150 validators. These validators may potentially earn a spot in Ripple’s Unique Node List, which comprises 35 validators.

Unconditional finality

When a transaction is confirmed, it is deemed to be fully and unconditionally final. Under no circumstances is the transaction susceptible to being undone. It can be difficult to achieve unconditional finality and frequently calls for a strong degree of centralization or a unique consensus