A Quick Guide To Blockchain Algorithms
Blockchain is a decentralized technology, and a lot of work happens at the backend that ensures seamless transaction and information exchange on the frontend. While there is so much to do, we have to know how Blockchain works. Blockchain developers and engineers have to work on a consensus algorithm that ensures the functioning of the operations. While there are many other types of consensus algorithms, most of them majorly know about the Proof of Work and Proof of Stake mechanism. In this blog, we will talk about some of the key Blockchain algorithms. As a part of Blockchain classes, you will learn about the different consensus mechanisms.
Types of Blockchain Consensus Algorithm
· Proof of Work (PoW)- Bitcoin works on Proof of Work. In this mechanism, the miners have to solve complex mathematical problems with computation power. The one who can solve the problem first can add the block and is also rewarded for the same.
· Proof of Stake (PoS)- Although Proof of Work is a powerful and most used algorithm, it needs a lot of energy, thus making it a costly affair. Hence Ethereum has shifted to another mechanism is Proof of Stake or PoS. In this case, the validator has to put some coins at stake to participate. They can start validating the blocks. The validators will validate the blocks by placing a bet on them.
· Proof of Burn (PoB)- In this case, the validator burns the coin by sending them to an address. But remember, this cannot be retrieved. Once you have committed the coin to an address, the validator gains an opportunity to mine on the system via random selection. The validator makes a long-term commitment in exchange for their short-term loss. Although it is a good alternative to the Proof of Work, you are burning the coins, which means that you are wasting the energy, and so its longevity becomes questionable.
· Proof of Capacity- In this consensus mechanism, the validator invests their hard drive space. The more is the hard drive space, the better are the prospects of getting selected for the mining process and earning a reward.
· Proof of Elapsed Time or PoET- This is mostly followed in permissioned Blockchain. In this, every validator gets a chance to create their own block. What the validator has to do is to add proof of their wait in the block. This block is then broadcasted to the others in the network. The winner is the one who has the least timer value in the proof part. The block of the winner is added to the Blockchain.
These are some of the popular Blockchain algorithms that Blockchain experts are using. A lot of study and skill goes into becoming proficient in this. If you are also looking forward to becoming a Blockchain expert in this domain, you must enroll in Blockchain classes. There are several Blockchain online classes that will help you become proficient in this technology and consensus algorithm.
Blockchain Council offers the best Blockchain classes online, and if you want to become a trained and qualified Blockchain professional, then you must enroll in the Blockchain certification program.