I am trying to figure out a way to use consensus algorithm on a private blockchain network, preferably ethereum. came across many suggestions. One of the suggestions which stuck was using PoA on Testnet and PoW or PoS on mainnet. There are few followup questions.
1- Can PoA be used on Mainnet? 2- what are the demerits of using PoA on Mainnet? 3- How efficient is PoA?
If it is a private blockchain there is no rationale to use proof-of-work or proof-of-stake. Because it is private you control the money pool and access 100% and proof-of-authority is the only sensible choice, because you are already the authority in the first place.
Because proof-of-authority is "decide by the authority" and there is no economic games and assumes 0% malicious block producers, it is much more efficient than proof-of-work and proof-of-stack
For Ethereum proof-of-authority example implementation, see Kovan (testnet) with Parity.
1- Can PoA be used on Mainnet?
No, PoA cannot be used by Mainnet. Any public blockchain mains privacy by not disclosing which address(public key) associated with whom. No one needs to disclose identity for participating identity in public blockchain. In PoA authorities need to disclose their identities for participating in the blockchain. In public blockchain, all the participant can participate in the consensus process while in PoA only authorities will participate in the consensus process.
2- what are the demerits of using PoA on Mainnet?
PoA cannot be used on Mainnet.
3 -How efficient is PoA?
PoA can be compared with consensus algorithms of the private blockchain. One can not compare PoA with consensus algorithms of the public blockchain. According to an abstract of this paper:
The analysis advocates that PoA for permissioned blockchains, deployed over the Internet with Byzantine nodes, do not provide adequate consistency guarantees for scenarios where data integrity is essential. We claim that PBFT can fit better such scenarios, despite a limited loss in terms of performance
