But it’s essential to note that a single centralized source of truth systems also means that there is a single source of failure. In a conventional data storage system, third parties are the entities that deal with record keeping. If you wonder why we need consensus, the answer is pretty complex. Proof-of-Stake consensus is the main challenger of Proof-of-Work’s hardware and electricity-based paradigm. Proof-of-Work uses a lot of electricity, and it concentrates mining power and rewards to the institutions that are willing to invest millions in mining equipment and electricity. It also becomes more complicated to establish consensus across the global network.Īmidst this change and growth, many people are starting to question the foundations of Proof-of-Work consensus as laid out by Satoshi Nakamoto in the Bitcoin white paper. The more transactions and nodes are added to a network, the more difficult it is to fit all those transactions in a block. And this is happening every ten minutes.Īll this growth has a challenge involving scalability and cost. As new blocks get mined, thousands of dollars worth of Bitcoin are up for grabs. It’s already become a cliché in the media to see how Bitcoin mining “consumes more energy” than small countries.Ĭompetition to create new blocks becomes fiercer with each day, and one of the main reasons is that rewards can be enormous. This growth and constant development that the blockchain has been seeing triggers an increased interest in providing the computing power behind the blockchain. This way, blockchain reached an inflection point in the public consciousness and enterprise use. Companies worldwide and across various industries are finding all kinds of innovative ways to fit the blockchain into their business models. Blockchain technology and its applications have been gaining popularity at the speed of light during the past years.
0 Comments
Leave a Reply. |