LeoGlossary: Proof-of-Work (PoW)

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LeoFinance
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A consensus mechanism where miners have to prove they did the work to solve the 64 character hash required to add a block. This is a system that relies solely on computational and processing power.

One criticism of the PoW consensus is the amount of energy that is utilized. Many feel this is a negative. Proponents claim that cryptocurrency mining is helping to push the adoption of renewable energy. Miners biggest variable cost is energy so it is in their best interest to reduce that as much as possible.

Nevertheless, many governments have moved to ban cryptocurrency mining. Energy usage is just one of the reasons they use to validate this action.

Bitcoin is the most recognized Proof-of-Work blockchain.

This is the protocol that Satoshi Nakamoto spelled out in the Bitcoin White Paper.

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