Federated Byzantine Agreement (FBA) | cryptocurrencies, blockchains & live prices

Federated Byzantine Agreement (FBA) is a consensus mechanism where each participating node independently chooses a set of other nodes — called a quorum slice — that it trusts to validate transactions. Rather than requiring every node in the network to agree simultaneously, FBA achieves consensus through overlapping quorum slices: if enough of these trusted subsets overlap, the network as a whole converges on a single agreed-upon state. This bottom-up approach to trust allows the network to grow organically without a central authority deciding who can participate.

The key advantage of FBA is that it enables open membership while maintaining fast, energy-efficient consensus. Anyone can join the network and select their own trusted peers, eliminating the gatekeeping of permissioned systems and the energy waste of Proof of Work. Transaction finality is achieved within seconds, making FBA suitable for payment systems and financial applications that demand speed and reliability. The trade-offs include the risk that poorly chosen quorum slices could lead to network fragmentation or failure to reach consensus, and the network's safety ultimately depends on sufficient quorum overlap — a property that must be carefully maintained as the network evolves.

The Stellar network, created by Jed McCaleb, is the most prominent blockchain using Federated Byzantine Agreement through its Stellar Consensus Protocol (SCP). Stellar has positioned itself as a platform for cross-border payments and financial inclusion, with its FBA-based consensus enabling 3-5 second settlement times and near-zero transaction fees. The network is used by organizations like MoneyGram and various central banks exploring digital currencies. Ripple's consensus protocol also shares similarities with FBA concepts, using a Unique Node List (UNL) approach. FBA has proven particularly effective for financial networks where speed, low cost, and institutional trust relationships are paramount.