An evaluation of blockchain consensus algorithms

Abstract

AbstractCryptocurrencies have exploded in popularity, and underlying them is an innovative technology known as blockchain: a distributed digital ledger in which bitcoin transactions are recorded once they have been validated. Many clients or "validators" inside the cryptocurrency'speer-to-peer network verify transactions within a ledger using one of many different consensus methods for addressing the issue of dependability in a network containing multiple faulty nodes. The Proof of Work (PoW) and Proof of Stake (PoS) algorithms are the most commonly used consensus algorithms; however, there are additional consensus algorithms that employ alternate PoW and PoS implementations, as well as hybrid implementations and even entirely new consensus methods. We compare and contrast traditional consensus algorithms with some of its contemporaries that are presently in use in contemporary blockchains in this article. Our investigation focuses on the algorithmic steps performed by each consensus algorithm, as well as the algorithm's scalability, the manner by which validators are compensated for their time spent confirming blocks, and the system's security concerns. Finally, we discuss our findings as well as some potential future trends in blockchain consensus algorithms.