What Is a Consensus Mechanism?
A consensus mechanism is a process used to reach agreement among distributed systems or networks. It is an algorithm that enables all participants in the network to agree on a single data value, such as transaction history or account balances. The consensus mechanism ensures that all nodes in the system have access to and agree upon the same set of information. This helps prevent malicious actors from manipulating data within the system by ensuring that any changes made are agreed upon by everyone involved.
The most common type of consensus mechanisms are Proof-of-Work (PoW) and Proof-of-Stake (PoS). PoW requires miners to solve complex mathematical puzzles before they can add new blocks of transactions onto the blockchain, while PoS allows users with large amounts of coins to stake their holdings for validation purposes. Other types include Byzantine Fault Tolerance (BFT), Delegated Proof-of-Stake (DPoS), and Practical Byzantine Fault Tolerance (PBFT). Each has its own advantages and disadvantages depending on what kind of application it’s being used for, but ultimately they all serve one purpose: reaching agreement between multiple parties without relying on trust alone.