Transaction Lifecycle

On AO, users have a wallet with which they create and sign transactions, also known as messages on AO.

Let's take a look at a high-level overview of what happens when a message is sent on AO, and how a user gets a response from the network.

Message validation

When a user interacts with a dApp on AO, for example a decentralized exchange process, a message is created and sent to an initial node.

This initial node receives the new message, checks to see if the transaction is valid (for example it has a valid signature, has the correct structure, etc.).

If the message is valid, it forwards this message onwards to be scheduled.

Message scheduling and storage

Once a message is deemed as valid, this means it can be scheduled for settlement and storage on Arweave.

A scheduler handles all of incoming messages associated with certain processes, orders them, and then stores these messages on Arweave.

This is a crucial part of the process, as it sets in stone the transaction ordering.

Each message is stored on Arweave in an immutable, timestamped order - just like with other blockchains.

Computation

Once a user's message is stored on Arweave, the new state of a process can be computed.

Think of it like this:

• An AO node sends off a message to be stored on Arweave
• Schedulers handle the message settlement, and once done, let the AO node know
• The AO node can now read all the transactions on Arweave, and re-construct the state
• A number of AO nodes can compute this state for further verification

And this is exactly what happens with AO. An AO node reads all of the state associated with a process from Arweave, computes it, and returns the result to the user.

This is ultimately how the message lifecycle works on AO.

But, where consensus?

This approach to computation is radically different to other solutions, which also means that consensus must also be approached differently.

Let's take a look at consensus in a little bit more detail.