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  • Introduction: IOTA's Smart Contract protocol requires consensus among validators, with more than two-thirds agreement needed for state changes.
  • 1. Formulate the Batch Proposals: Validator nodes begin the consensus process with batch proposals, requiring mutual agreement to ensure uniform inputs and results.
  • 2. Agree On the Batch: A finalized batch is created by filtering and ordering requests from all proposals, safeguarding against manipulation.
  • 3. Establish the State Anchor: Validators independently execute smart contract requests to create a new block, followed by crafting a state anchor for Layer 1 transaction validation.


In IOTA's Smart Contract protocol, updating the chain requires consensus among validator nodes. This means more than two-thirds of validators must agree on any state change. This requirement is crucial for maintaining the chain's integrity and prevents any single node from causing disruption.

Since smart contracts are deterministic, all honest nodes will yield identical results, provided they receive the same input. However, variations in access points to the Tangle and the inherent randomness in receiving contract requests can lead to different perspectives among nodes.

1. Formulate the Batch Proposals

The consensus process starts with each validator node presenting a batch proposal. This proposal includes a timestamp, a list of pending requests, and the node's partial signature of its commitment to the current state. Nodes must then mutually agree on a set of batch proposals to process. This agreement process ensures that a common subset of proposals is selected, allowing nodes to work with identical inputs and, consequently, produce matching results.

2. Agree On the Batch

Transforming the selected batch proposals into a finalized batch involves counting and filtering requests from all proposals. This method ensures uniformity in the order of requests. The combined partial signatures of all validators create a full signature, which, through a pseudo-random function, determines the final sequence of requests. This step is essential to guard against manipulation and predictability (shielding the system from MEV attacks).

3. Establish the State Anchor

Once the input is agreed upon, each validator independently executes the smart contract requests, leading to the creation of a new block. Subsequently, each node constructs a state anchor - a Layer 1 transaction attesting to the commitment to this new state. The state anchor, bearing a timestamp derived from all batch proposals, is signed by all validators. This unified signature guarantees that any validator can publish the transaction to Layer 1. Although state anchors can be published after every update, they are typically released every ten seconds to minimize the load on the Tangle.

Dive Deeper

You can gain a deeper understanding of consensus in the IOTA Smart Contracts documentation.