WHAT IS PROOF OF WORK?

denizcanguler (58)in #blockchain • 6 years ago (edited)

WHAT IS PROOF OF WORK?

Considered by some of the crowning achievements of Bitcoin founder Satoshi Nakamoto, the idea for PoW was published in 1993 by Cynthia Dwork and Moni Naor. “Proof of Work” terminology was published in 1999 by Markus Jakobsson and Aei Juels. This method (Proof of Work = PoW) was originally developed as a method of dealing with junk e-mail (spam) in the late 90s. A small mathematical task is added to e-mail sending protocols. Thus, when sending e-mails, the e-mail server performs the sending after the computer proves to be working for a short time. If there are 3-4 people in the email we send, we will not notice the time spent on this. However, if e-mail is sent to thousands of people, the process of sending a lot will be prolonged. This would be a deterrent to sending junk e-mail. However this method went largely unused until Satoshi created Bitcoin in 2009. He releases that this mechanism could be used to reach consensus between many nodes on the network and he uses it to secure the blockchain.

WHY IS IT IMPORTANT?

The aim is to prevent the miners from forming continuous blocks on top of each other. Otherwise, thousands of miners produce thousands of blocks every second, and it becomes impossible for the blockchain to be single. These consensus algorithms are applied in order to ensure that block productions are carried out at certain intervals.

HOW IT WORKS?

Proof of Work algorithm works by having all nodes solve a cryptographic puzzle (mathematical problem). This is not an ordinary puzzle or mathematical question. By using the SHA-256 Hash function, a specific summary value is created and miners by changing the value in the nonce domain without changing the data in the block, try to find the summary value that matches the desired criteria by making a large number of trial and error. This process requires extreme processing power. Summary calculation can be done very fast. However, this process is performed trillions of times to find the correct summary value. This results in high energy consumption. This situation creates a serious competition and it becomes impossible to perform this process on standard computers with the developing technology. With the emergence of ASIC devices, doing this from a normal computer is not a profitable process. Therefore, people investing in mining machines (ASIC) or they are creating mining pools.

Block production is expected to be approximately 10 minutes. However, this period is shortened as computers develop, the system increases the difficulty level of the problem in order not to change 10 minutes. Today, the speed of ASIC devices starts at 1TH / s, so the problem becomes increasingly difficult.