dido:public:ra:xapend:xapend.k_consensus:02_mechanism:poa
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dido:public:ra:xapend:xapend.k_consensus:02_mechanism:poa [2021/07/18 13:34] nick |
dido:public:ra:xapend:xapend.k_consensus:02_mechanism:poa [2021/08/13 14:01] (current) murphy |
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| )) provides the following definition: | )) provides the following definition: | ||
| - | //**Proof of Activity (PoA)** is a blockchain consensus algorithm used in cryptocurrencies and similar systems. It is used to ensure that all transactions occurring on the blockchain are genuine, as well as to ensure that all miners arrive at a consensus. PoA is a combination of two other blockchain consensus algorithms: proof-of-work (PoW) and proof-of-stake (PoS).// | + | //**Proof of Activity (PoA)** is a [[dido:public:ra:xapend:xapend.a_glossary:b:blockchain|blockchain]] [[dido:public:ra:xapend:xapend.a_glossary:c:consensus_algorithm|consensus algorithm]] used in cryptocurrencies and similar systems. It is used to ensure that all transactions occurring on the blockchain are genuine, as well as to ensure that all miners arrive at a consensus. PoA is a combination of two other blockchain consensus algorithms: [[dido:public:ra:xapend:xapend.a_glossary:p:proof_of_work|proof-of-work (PoW)]] and [[dido:public:ra:xapend:xapend.a_glossary:p:proof_of_stake_pos|proof-of-stake (PoS)]].// |
| - | //Bitcoin, the most popular cryptocurrency, uses the PoW consensus algorithm. A special feature of this algorithm is that it increases the difficulty level of the mining as time passes by. This method also prevents the bitcoin network from being hacked. However, because the difficulty of mining increases more and more computing power must be used. As a result of there being more energy consumption, there are more costs involved (including the costs of wear and tear on the hardware).// | + | //[[dido:public:ra:xapend:xapend.a_glossary:b:bitcoin|Bitcoin]], the most popular [[dido:public:ra:xapend:xapend.a_glossary:c:cryptocurrency|cryptocurrency]], uses the PoW consensus algorithm. A special feature of this algorithm is that it increases the [[dido:public:ra:xapend:xapend.a_glossary:d:difficulty|difficulty]] level of the [[dido:public:ra:xapend:xapend.a_glossary:m:mining|mining]] as time passes by. This method also prevents the bitcoin network from being hacked. However, because the difficulty of mining increases more and more computing power must be used. As a result of there being more energy consumption, there are more costs involved (including the costs of wear and tear on the hardware).// |
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| - | //With a PoS system, a miner's ability to mine or authenticate transactions depends on how many cryptocurrency coins they hold. Although the PoS system achieves a reduction in electricity bills, an unintended side effect of it is that it can promote coin hoarding (rather than spending).// | + | //With a PoS system, a miner's ability to mine or authenticate transactions depends on how many cryptocurrency [[dido:public:ra:xapend:xapend.a_glossary:c:coins|coins]] they hold. Although the PoS system achieves a reduction in electricity bills, an unintended side effect of it is that it can promote coin hoarding (rather than spending).// |
| //Both PoW and PoS systems are intended to prevent the likelihood of a 51% attack—a situation where a group of participants gains control of more than half the network's mining computing power. The danger of a 51% attack is that that group can then have full control of the network, including the power to halt new transactions from getting confirmed, stop payments between various blockchain users, and even reverse the transactions completed in the past during their control of the network, allowing them to double-spend the cryptocurrency coins.// | //Both PoW and PoS systems are intended to prevent the likelihood of a 51% attack—a situation where a group of participants gains control of more than half the network's mining computing power. The danger of a 51% attack is that that group can then have full control of the network, including the power to halt new transactions from getting confirmed, stop payments between various blockchain users, and even reverse the transactions completed in the past during their control of the network, allowing them to double-spend the cryptocurrency coins.// | ||
dido/public/ra/xapend/xapend.k_consensus/02_mechanism/poa.1626629645.txt.gz · Last modified: 2021/07/18 13:34 by nick
