Finality

Just because a transaction shows up on the blockchain doesn’t mean it’s set in stone — it can still be reversed or reorganized, depending on how the blockchain works. I.e., blockchains differ in their consensus mechanisms and finality times so while transactions may appear on-chain shortly after submission, they are not immediately secure from potential modifications or reversals. This impacts UIP's transaction speed.

Types of Finality

The finality of the source and destination blockchains plays a critical role in transaction execution latency. On fast-finality blockchains like Avalanche or Cosmos, finality can occur in under a second, allowing near-instantaneous cross-chain interactions. Conversely, blockchains with slower finality, such as Ethereum or Bitcoin, introduce additional delays, which can range from minutes to hours depending on network conditions and the number of confirmations required.

Different blockchains have their own ways of deciding when a transaction is truly final, and these methods can vary a lot in terms of speed and security. Generally, there are two types of finality:

• Determinisitic Finality - Ensures that once a transaction is finalized, it cannot be undone. This type is common in Proof of Stake (PoS) and Proof of Authority (PoA) blockchains, which rely on validators reaching consensus to confirm a transaction's permanence. Deterministic finality offers users predictability and security, as transactions are finalized once specific protocol criteria are met, often within seconds to minutes.

• Probabilistic Finality - Typical in Proof of Work (PoW) blockchains, provides increasing certainty over time. Transactions become more secure as additional blocks are added on top of the block containing the transaction. While this model works effectively, it is slower than deterministic systems, often requiring minutes or even hours for practical finality.

Examples

• Ethereum (PoS) - Finality is reached when validators agree on "checkpoint" blocks, requiring a two-thirds majority for validation. Reverting a finalized block would require burning one-third of the total staked ether, making such attacks prohibitively expensive.

• Cosmos (Comet BFT) - Cosmos achieves near-instant finality through Byzantine Fault Tolerant consensus, finalizing blocks as soon as two-thirds of validators confirm them.

• Avalanche - Employs probabilistic sampling, where validators repeatedly vote until a consensus is reached, achieving sub-second deterministic finality.