PoW (Proof of Work)

Proof of Work (PoW) is the original and best-known consensus mechanism used in blockchain networks. Its main purpose is to ensure that all network participants agree on the validity of transactions and to make it extremely difficult and costly to cheat the system or alter the records on the blockchain. This mechanism is a key component of the security and decentralization of the most famous cryptocurrency, Bitcoin.

The process operates on the principle of mining. Miners around the world compete to solve a complex mathematical puzzle using immense computational power. The first miner to solve the puzzle earns the right to add the next block of transactions to the blockchain and, in return, is rewarded with newly created coins of that cryptocurrency (e.g., bitcoins). By making the process computationally intensive, PoW ensures that an attacker would need to control more than 50% of the entire network's computing power to compromise the system, which is practically impossible. The main disadvantage of this mechanism is its enormous consumption of electrical energy.