In brief, consensus mechanisms are protocols, that is sets of rules in the blockchain, that make it possible for all the nodes to agree on validity of transactions.💡 Let's explore some of the consensus mechanisms set in blockchains. Proof of Work (POW) is a consensus mechanism deployed in the first ever blockchain - Bitcoin. This protocol uses computational power to validate transactions and produce new blocks to the chain.🔋
The creators of blocks are called miners. They have to compete with each other to confirm transactions and receive certain fees for creating blocks.🎛 Ten years ago, when Bitcoin just came about, the transactions required little computational power, so a simple central processing unit on a computer could easily mine blocks. However, today miners use Application-Specific Integrated Circuit, designed specifically to mine cryptocurrency or engage in mining pools or cloud mining.🏪