Proof of Work is a mechanism where the computers present in the network compete against each other to be the winner by solving difficult puzzles.
This entire procedure is usually known as mining because this process demands resources as well as energy to complete the puzzle. These resources and energy are usually considered the digital equivalent of the real-world procedures, Trending blockchain is a worthy solution for mining pieces from the land of digitalization.
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Exploring Proof of Work Mechanism
To provide you with proper analysis, we are here exploring the Proof of Work mechanism. Below we will discuss the significant pros as well as cons of this consensus mechanism.
Pros of Proof of Work
We have listed below three major benefits of the Proof of Work mechanism.
Upstanding Competition and Sustainable Energy
If we talk about competition in Bitcoin for Proof of Work, it is quite fierce. To drop their prices, mining firms are not-stop seeking out the most productive as well as resourceful methods to mine. This entire procedure integrally provides rewards to the people who find the most economical types of energy and brings the latest technology to generate speedier and more competent chips for mining.
As we have discussed how it benefits cryptocurrencies, what is more to it is it has huge competition against the chipmakers that is a big revolution in computer hardware.
The mining of cryptocurrency allows some communities to make use of their trapped energy and transform it into some valuable object or asset. This converted value can be transferred or utilized to fund and support other upcoming projects, which will in the long run provide economic activities in inaccessible areas.
There are two real-world examples in front of you. China’s Sichuan and Yunnan provinces. Both the provinces have extreme wet seasons that generate huge amounts of sustainable hydroelectric power. But unfortunately, these provinces have no way of transporting and selling this huge energy asset to other needy areas.
To date, the Proof of Work mechanism has been the most proven method to maintain consensus as well as safety within a dispersed public system. All this is due to the reason that Proof of Work requires the initial cost of hardware and the current expenses of material, instead of one upfront expense to participate like Proof of Stake requires.
Cons of Proof of Work
Below are some of the prominent drawbacks of the Proof of Work mechanism.
High Energy Consumption
The Proof of Work blockchains, be it Bitcoin’s or other cryptocurrencies such as Ethereum or Litecoin, consume a huge amount of energy to provide their security model to their networks. The amount of power or energy Bitcoin requires is bigger than entire nations including Norway and Ukraine. Many environmentalists have also debated this practice and claimed it to be useless.
While these projects consume enormous amounts of energy, various opponents have failed to evaluate the types of energy utilized in mining and rather compare its high power use to a large environmental impression. According to various studies and reports, Bitcoin miners utilize multiple energy sources in their tasks and missions. Some evaluations have claimed that these projects use 50% to 70% of the power used.
E-waste is considered the most valid condemnation of the Bitcoin network’s consumption resources. The miner of Proof of Work usually operates at full power 24 hours and 7 days a week. Sometimes, poor circumstances such as humidity, extreme temperatures, and improper ventilation affect mining and shorten the life of tools and equipment used in the process.
Not to forget that the ASIC chip makers are continually developing newer and more efficient chips. Whenever a modernization takes place, the old chips become less productive at winning blocks as compared to the new chips. With time, the old chips are then phased out and become electronic waste (e-waste).
When it comes to the digital world, what people need the most is censorship and security for their assets and data. Traceability is one of the many concerns of crypto mining that have already occurred in locations like China where the authorities have banned crypto mining. The massive energy use can be traced using electricity readings or even thermal cameras. The fact that crypto mining can be traced allows critics to crack down on the work.
Proof of Work is a well-functioning blockchain-based algorithm that assists in offering security to a variety of crypto assets including Bitcoin, Ethereum, and other altcoins.