Finding Alternative Consensus Mechanisms

Abstract

Steps 18 and 19 explained how blockchain uses hash puzzles (proof of work) and rewards, together with randomness, to reach consensus. However, proof of work consumes a noticeable amount of electrical energy, which in turn may have negative side effects (e.g., higher energy prices or the environmental impact of energy production). For this reason, this step will introduce you to one of the main alternatives to proof of work, that is, proof of stake. Additionally, the general idea of alternative ways to achieve consensus in blockchain systems is presented.