<aside> 💡 URL: flint.money/learn/popular-consensus-mechanisms
<aside> 💡 Page Title: What are some popular consensus mechanisms and how do they work? | Flint
<aside> 💡 Metadata: A consensus mechanism is an algorithm to that is used to run and safeguard the blockchain. There are a few popular mechanisms that have found widespead adoption amongst different blochchains
Blockchain, by its very nature, is a technology that relies on a distributed ledger system. It means that there’s no central authority controlling the operations of the chain. Fundamentally, every network needs a few controllers/ mechanisms so that the network functions smoothly. As in the case of a decentralized world, there can’t be a single authority controlling the entire operations of the chain. To solve this issue, here comes the concept of a consensus mechanism.
Consensus means “general agreement” and mechanism means “method/ methodology”. In simple words, to check up on the happenings of the chain, a methodology is being set on every blockchain which is called a consensus mechanism.
Technically, the consensus mechanism is the way by which the nodes - the computers on the blockchain validate the transactions happening on the chain. As per the official Ethereum website, a consensus mechanism is a set of protocols or consensus algorithms that allow distributed systems (networks of computers) to work together and stay secure.
The need for a consensus mechanism arose in order to prevent bad players from capturing the network. Bad players may include persons doing multiple false transactions etc.
Consensus mechanisms also solve the problem of double-spending by making it expensive and difficult to propose a new block of validated transactions, discouraging bad actors from trying.
Similarly, the mechanism incentivizes the "good" nodes to propose blocks they genuinely believe will be accepted to receive valuable rewards.
Proof of work is the original consensus mechanism that was first used by bitcoin. Under this mechanism, to validate a transaction, all miners need to solve a complex mathematical puzzle. The one who solves the puzzle the fastest is the winner and gets to upload & validate the transaction. The winner is also rewarded with a pre-determined amount of crypto. As everyone has to solve the puzzle and only one gets to win the transaction, a lot of developers realized this early that this method is time-consuming as well as consumes a lot of energy. Hence, it’s not sustainable and scalable. This led to another consensus mechanism called proof of stake.
Read more about What is Proof of Work? to understand the concept in depth