Crypto glossary
Consensus mechanism
A consensus mechanism is the set of rules that lets a blockchain's independent nodes agree on which transactions are valid and in what order.
A blockchain has no central administrator, so its participants need a way to agree on a single version of the ledger. The consensus mechanism defines who gets to add the next block, how others check it and what happens when two competing versions appear.
The two dominant designs are proof of work, used by Bitcoin, where miners spend computing power to win the right to add a block, and proof of stake, used by Ethereum since September 2022, where validators lock up coins as collateral. Other variants include delegated proof of stake and the Byzantine fault tolerant protocols used by many newer chains.
The choice shapes a network's security, energy use, speed and degree of decentralization. Anyone who controls a majority of the hashing power or stake could in principle rewrite recent history, so these mechanisms are designed to make that prohibitively expensive.
Example
If two Bitcoin miners find a block at the same moment, nodes briefly see two competing chains; the consensus rule says to follow the chain with the most accumulated work, so one of the blocks is soon discarded.
Related terms
Latest articles on Consensus mechanism
- What Is Zero Knowledge Proof? A Guide to Hybrid Consensus and Private AI Compute
- Sei Proposes Autobahn Consensus Upgrade Delivering 250ms Transaction Finality Speed
- Sei Hermes Consensus Smashes 100K TPS With SEI Giga Roadmap Boost
- XRP Ledger Nears Key September Upgrade With Strong fixCleanup Consensus
- XRP Ledger Node Operators on Alert as Critical Amendment Reaches 68% Consensus
