What is the PoW ?
The Proof of Work (PoW) protocol mandates that some type of work be required from the service requestor. This often comes in the form of computer processing time to solve complex mathematical equations.
The goal a PoW system is to deter lethal denial of service attacks or other unwanted services like spam. It can also be used to keep a network stable and secure. If the originating party must jump through hoops to carry out their objective, they will be quickly disincentivized.
PoW Key Elements
One of the key components of a PoW system is asymmetry. The work must be difficult for the service requestor but easy for the other party to validate. These elements carry over into the Proof of Work blockchain mining protocol.
Proof-of-Work mining uses complicated algorithms to solve blocks of transactions. Each block contains one valid hash that must be generated by a miner. This is what makes Proof of Work mining “difficult”–only the right hash will validate a set of transactions.
Additionally, the correct hash is determined arbitrarily, so there is no preset way to solve a block through a specific calculation. Therefore, the Proof of Work protocol operates on a trial by error basis.
Mining software uses algorithms to generate hashes which are proposed to the block. This is the “work” demanded by the Proof of Work protocol. When the valid hash is proposed, the block is verified and added to the blockchain.
The “proof” Aspect
The other important part of the PoW concept is the “proof” aspect. The “proof” is that miners compete for the correct hash; the miner who first offers the correct hash solves the block. When the block is verified, miners will be able to see the correct hash.
The nature of Proof of Work mining makes it very expensive in the long run. The trial and error process means that miners must use tremendous amounts of equipment and energy to run the software and generate the correct hash. Miners often join mining pools to combine resources and increase aggregate processing power.