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Proof of Work

What is proof of work in blockchain technology?

Proof of work is a consensus model in blockchain technology that requires miners to solve computationally difficult math problems in order to add new blocks onto the blockchain. These functions produce data that is used to validate that a substantial amount of work has been carried out, thus the name “proof of work.” Although solving these equations will typically result in the winning miner claiming a block reward by adding it as a first transaction on the block, proving these functions are often time-consuming and computationally expensive. Sometimes this cost of mining can even outweigh the price of the reward.

The main proof-of-work based cryptocurrencies include Bitcoin, Ethereum, and Litecoin. Alternatively, some blockchains, such as Ethereum, have proposed moving towards a proof of stake consensus model in order to solve energy waste and scalability issues.

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