Blockchain Consensus Mechanism

Blockchain Consensus Mechanism

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  • This article refers to the imToken Help Center Vocabulary
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PoW: Proof of Work (PoW). A simple explanation of PoW is a certificate confirms that you have done a certain amount of work. It is a more efficient way to prove the workload by certifying the results of the work comparing with monitoring whole process of the work. For example, graduation certificates and driver's licenses in real life. This means that how much you get depends on your effective work on the mining contribution. Briefly speaking, the better computer's performance is, the more you gain, and that is the allocation of coins based on your workload. Most digital currencies, such as Bitcoin, Litecoin, etc., are based on the PoW mode (the higher the power and the longer the mining time, the more coins you get).

PoS: PoS is a consensus algorithm in the public chain and can be used as an alternative to the PoW algorithm. PoW is a mechanism to ensure the security of bitcoin, current Ethereum and many other blockchains, but the PoW algorithm has been criticized for environmental damage and power waste in the mining process. Therefore, PoS attempts to solve these problems by replacing the concept of mining with a different mechanism.

The PoS mechanism can be described as a kind of virtual mining. PoS relies mainly on tokens in the blockchain itself. In the PoW, a user may get $1,000 to buy a computer, join the network to mine a new block, and be rewarded. However, in the PoS, users can purchase $1,000 worth of tokens and put these tokens as deposits in the PoS mechanism, so that users have the opportunity to generate new blocks and be rewarded. In the PoW, if a user spends $2000 to buy hardware devices, he/she will of course earn twice as much power to mine and earn twice as much reward. Similarly, investing twice the token in the PoS mechanism as a deposit would have twice the chance of gaining new blocks.