DeFi 10107 September 2021

What is Proof of Work?

Summary

· PoW ensures that online currencies works without a central authority

· PoS solves the issue of double-spending

PoW (Proof of Work) is an algorithm securing most cryptocurrencies such as Ethereum and Bitcoin. In most digital currencies, a central leader keeps track of each user and the amount of money. In cryptocurrencies like Bitcoin, there is no leader. PoW is necessary to ensure the online currency works without an intermediary running the operation.

PoS solves the issue of double-spending, which is not easy to tackle with no leader. If users double-spend their coins, this will inflate the supply, debasing all the coins and make the cryptocurrency worthless and unpredictable.

Proof-of-Work adds new blocks to the blockchain. Miners initiate new blocks and execute PoW. The blockchain accepts every new block every time a miner initiates a new winning PoW, which is approximately ten minutes.

Kibet Elikana
Write a comment