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Why Random Number Generation happened in Blockchain

In cryptography, there are various types of algorithms that can be used to generate random numbers. In order to make the process of encryption decryption harder and more unpredictable, the use of random numbers is necessary. Random numbers are the sequence of numbers that are placed in such a way that the values of the sequence should be distributed randomly.  Random number generators are used in several industries such as gaming, financial institutions, cyber security, communications, etc.
Random numbers are classified in two categories: likely true random numbers and pseudorandom numbers.

Random numbers sequence is uniformly distributed and that is why it is impossible to predict what number it will be or what the sequence is. These numbers are generated with the help of mathematical algorithms.
The quality of the random numbers used in cryptography decides the security toughness of the system. If the quality of the random number generator is good then it would be very difficult for anyone to break into the system. It has been proven difficult to break into algorithms such as AES, RSA, and ECC. In cryptography, it is most important to check that the secret keys are random and secure. 

Types of random numbers 

Random numbers are classified into two categories, i.e. true random numbers and pseudo numbers. Random number generators are applied to devices like dice, playing cards, coins, etc.
Nowadays, random number generators are implemented through programming based on deterministic computation, but this is not really taken as true random because the output that we get can be predicted if all seed values are known, so this is called pseudorandom number generation

True random number generators: A true random number generator uses seed values to generate the numbers. Entropy is a mixture of values that is not easily predictable.  One can get the entropy from the environment of the computer such as keystroke timing, disk electrical activity, mouse movement, etc. combination of all this produces a random binary output as shown in the figure.

Feature of true random numbers 

It is generated by seed values from the entropy source that are present in the environment.
Bits are distributed uniformly overall in the sequence, and the rate of zeros and ones are equal.

It is independent in nature and unpredictable.

 Types of true random number generators 

  1.  Random.org: it is a website that generates random number sequences that are distributed to varied users. Entropy is collected from the atmosphere by a random number generator from a website. 

It has been certified by several third parties that the number sequence on this site passes the industry-standard test suites, making it a free and feasible option for non-regular or permanent users of random numbers.

  1. HotBits: it is also a popular random number generator on the web. It generates the random number sequence based on radioactive.  It is not used in the encryption of information as it’s easy to guess. 

Pseudorandom number generator

A random number generator that does not depend on real-world activities to produce a sequence of numbers is referred to as a pseudorandom number generator. 

Features of pseudorandom number 

  • It is generated by a mathematical algorithm 
  • It is unpredictable
  • Seed is being generated from the entropy source of the physical environment. 

Importance of random numbers to blockchain 

The main idea behind cryptography used in blockchain is to secure randomness.  Cryptographic hash functions are building blocks of security used in the creation of private keys for wallets and ensure that the probability of guessing the key is hard and next to impossible because there are 12,24 bit characters in wallet private keys that are randomly generated when clicking on the button.

 In a public blockchain with a number of distributed participants, it would be difficult for every node to communicate with every other node to reach an agreement. Bitcoin utilizes Proof of Work (PoW) to introduce randomness in selecting which block is added to the blockchain. The computational puzzle that miners compete to solve for adding a block to the blockchain is quite complex, reducing the likelihood of multiple nodes solving the puzzle simultaneously. Consequently, this decreases the number of messages necessary for the network to establish consensus.


Proof-of-Stake (PoS) systems often use randomness to ensure that validator duties are allocated fairly and unpredictably. If the source of randomness used in the selection process can be manipulated, a malicious actor can increase their chances of being chosen and threaten the security of the network by compromising the whole network.
One of the properties of blockchain is transparency in nature so all the nodes that are participating as validators are visible so members may guess the random numbers which are being generated.  To solve the issue there are various techniques that are being used in blockchain technology for generating random numbers. 

Methods of generating random numbers in blockchain




These methods are being used to generate random numbers outside of the blockchain and after generating information is submitted to the network.  This includes two major techniques to generate randomness outside of blockchain data. Examples are oracles and decentralized protocols such as Chainlink.


Oracles:  Oracle can provide random numbers from external sources. They are smart contracts that collect data from the environment generate randomness and submit the result to blockchain.

Decentralized protocol:  protocols like chain link have smart contracts named VRF( verifiable random function) which offer randomness to the blockchain data. The systems enable smart contracts to ask for random numbers that are produced in a way that can be proven to be fair. Users can confirm the randomness supplied by the oracle, guaranteeing transparency and confidence.

Real-world applications of random number generators in Blockchain 

  1.  Blockchain Gaming: These platforms enable smart contracts to generate random numbers that are produced in a verifiably way. Individuals can validate the randomness offered in. Games based on blockchain. Random number generator increases player involvement and satisfaction.
  1.  Decentralized Finance: Random number generation plays a crucial role in DeFi applications to ensure equal distribution of tokens, interest rates, and other financial products. For example, RNG may be utilized in yield farming protocols to fairly distribute rewards among participants, preventing any potential manipulation or prediction of the distribution.
  1.  Non-fungible Tokens: NFTs can be created and distributed with the use of RNG to produce digital assets with rarity. RNG can be employed by platforms to decide the desirability of tokens, thereby boosting the thrill and unpredictability of the market.

Conclusion 

Generating random numbers is a crucial part of blockchain technology, as it ensures security, fairness, and openness in decentralized applications. Even though deterministic environments and possible manipulation present obstacles, different approaches, such as on-chain randomness and decentralized oracles, offer solutions for producing trustworthy random numbers. It will be crucial to grasp and put into action reliable RNG mechanisms to uphold trust and integrity in the decentralized ecosystem.

 

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