Proof of work

Jonas Valbjørn Andersen

Chapter 34 in Elgar Encyclopedia of Cryptocurrencies, Blockchain and DLT, 2026, pp 169-173 from Edward Elgar Publishing

Abstract: Proof of work (PoW) is a foundational consensus algorithm in blockchain technology, ensuring transaction validity, network security, and decentralization without a central authority. Introduced in Bitcoin, PoW requires miners to solve complex cryptographic puzzles to validate transactions and add blocks, promoting immutability and trust. Despite its strengths—security, decentralization, and tamper-resistance—PoW faces criticism for its high energy consumption, centralization risks, and barriers to entry. These challenges have prompted exploration of alternative mechanisms like proof of stake (PoS) and proof of authority (PoA). PoW remains critical to early and ongoing blockchain systems, including Bitcoin, Litecoin, and pre-Merge Ethereum.

Keywords: Proof of work; PoW; Consensus mechanism; Blockchain security; Cryptographic hashing; Decentralization; Energy consumption (search for similar items in EconPapers)
Date: 2026
ISBN: 9781035339952
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