A mathematical deep-dive into sequential squaring VDFs, proof of elapsed time, and their role in un-gameable financial contracts.
Unlike standard proof-of-work hashes that can be parallelized across thousands of ASIC cores, Verifiable Delay Functions (VDFs) require inherently sequential computation: step N+1 cannot begin until step N completes. However, verifying the final output requires only milliseconds of computation.
We review the mathematical formulations of Wesolowski and Pietrzak VDFs over RSA groups and class groups of imaginary quadratic fields, proving why parallel supercomputers cannot accelerate the elapsed time required to unlock escrowed funds.
How timelock encryption and VDFs prevent MEV searchers and block validators from inspecting escrow transactions in the public mempool, eliminating front-running and sandwich attacks on high-value capital distributions.