Proof of Work (PoW)
By CoinGecko | Updated on Mar 03, 2020
An algorithm that rewards the first person that solves a computational problem (i.e. mining) to achieve distributed consensus. Miners compete to solve difficult cryptographic puzzles in order to add the next block on the blockchain. It prevents spam and cyber attacks such as DDoS as it requires work (i.e. processing time) from the service requester.
Related Terms
Mining
It is the process of the miners verify and adding transaction recors into a block.
Derivatives
A financial instrument which derives its value from the performance of an underlying asset or index (eg. gold, crude oil)
Hybrid PoW/PoS
It is the allowance for both Proof-of-Stake and Proof-of-Work distribution consensus to work on the same network.
Non-custodial
It is a decentralized type-of-wallet, where the users owns its private keys.
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