Crypto glossary
Proof of work (PoW)
Proof of work (PoW) is a consensus mechanism in which miners compete to solve a costly computational puzzle for the right to add the next block.
In proof of work, miners repeatedly hash a candidate block with a changing number called a nonce until the result falls below a target set by the network. Finding a valid hash takes enormous trial and error, but anyone can verify it instantly. The winner adds the block and earns the block reward plus fees.
Security comes from cost: rewriting history would require redoing the work of every later block and outpacing the honest network, which demands more than half of the total hashrate. Bitcoin adjusts the puzzle's difficulty every 2,016 blocks, about two weeks, to keep block times near 10 minutes.
Critics point to its heavy electricity use and the concentration of mining in large industrial operations. Bitcoin, Litecoin, Dogecoin and Monero still use PoW; Ethereum abandoned it in September 2022.
Example
A Bitcoin miner running specialized ASIC machines computes trillions of hashes per second; when one of them finds a valid hash, the miner broadcasts the block and collects 3.125 BTC plus the transaction fees.
