Blockchain | List of Consensus Algorithms and their Descriptions

The consensus algorithm is an algorithm whose technology runs behind cryptocurrency to function as security, distribution, and others. The Kosesus algorithm has several types and has a function and how each one works. Here are the most used algorithms and cryptocurrency:

Proof of Work (PoW)
It is the first consensus algorithm that is made, the most popular, and is considered the most reliable. Proof of Work is implemented into Bitcoin (BTC) cryptocurrency and inheritance, and serves to create new blocks and maintain network security "through the mining process". PoW makes it possible to eliminate central authority or other third parties in sending money, Pow provides real-time payment verification to peer-to-peer (P-t-P) networks and reduces overall transaction costs.

The POF of Work network is managed by a network of miners, who use the Advanced Specific Integrated Circuit (ASIC) software to complete complex cryptographic calculations. An average of new blocks will be created every 10 minutes. Every new block created, the miners will be rewarded with a coin (depending on the crypto that is mined) along with all transaction costs of the block.

However, PoW will increase the level of difficulty mining every time and impact on the increasingly expensive costs and the fact that the ASIC device is quite expensive makes some people think "how far the pow will be used". Even so, the PoW blockchain is considered the safest solution.

Proof of Stake (PoS)
Proof of Stake is the most widely used alternative to substitute for Proof of Work. PoS systems are made more efficient and solve problems that often arise in Proof of Work, such as energy problems. Blockchain Proof of Stake is secured in a deterministic way. In PoS there is no mining term and the validation of new blocks depends on the coins being pegged. Simply put, the more coins held, the chance to become a block validator. Examples of PoS implementations are Stellar Lumens and NXT coins.

Delegated Proof of Stake (DPoS)
This algorithm was developed by Daniel Larimer, in 2014. The DPoS Blockchain counts by polling where the stakeholder assigns his work to a third party. In other words, they can choose several delegates to secure the network on their behalf. This delegation also witnessed and was responsible for achieving consensus in the making and validation of the new block.

Each project has varying votes, usually, the delegates' wages are divided proportionally. Projects that use DPoS are Bitshares, Steem, Ark, and Lisk. DPoS can process more transactions per second (TPS), compared to PoW and PoS.

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Blockchain | List of Consensus Algorithms and their Descriptions Blockchain | List of Consensus Algorithms and their Descriptions Reviewed by sheffter on September 26, 2019 Rating: 5

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