If you familiar with the cryptocurrency and mining stuff, in there you heard about word POW (Proof Of Work) and Bitcoin mining is difficult nowadays.
So what is POW means, and why it is related to Bitcoin mining?
POW (Proof Of Work)
POW (Proof Of Work) concept first introduced in Bitcoin, it is proof of work done by miners, means a miner to actually enter his block of transactions into the blockchain he will have to provide an answer or a proof to a specific challenge, for finding proof miners use CPU, GPU, FPGA or ASICs in proof of work.
This proof is difficult to produce but is very easily valid, for example, guessing a combination to a lock is a proof to a challenge it’s very hard to produce, this since you’ll need to guess many different combinations but once produced it’s easy to validate just enter the combination and see if the lock opens.
For detailed information about Proof, Mining you should check out this article POS(Proof Of Stake.
Then How POW Related To Bitcoin Mining..?
Bitcoin uses hash cash proof of work which is invented in 1997 by Adam Back, this is mainly invented for anti-DoS uses including preventing: anonymous remailer and mail2news gateway abuse, as well as general email anti-spam and general network abuse throttling.
In Bitcoin proof of work, all miners get a previous block transaction hash rate in order to add a new block to the blockchain, to enter the new block all miners should look to a proof or a correct combination to open the new block using old block hash.
Finding those Proof miners use CPU, GPU, FPGA or ASICs, so these components use a lot of electricity, you know Bitcoin is popular cryptocurrency, Bitcoin dominate 42% of crypto market capital, so obviously more transactions recorded in bitcoin blockchain, that is lead to more mining, more power consumption, and also in bitcoin blockchain one block opening time is 10 minutes, these factors made bitcoin mining difficult.
Let’s check out some advantages and disadvantages of this mining method.
Advantages and Disadvantages of POW.
Let’s talk about some advantages of POw first, if miner joins the newly started blockchain miner can mine coin by his low-end hardware components.
Less entry barrier, that means entering into POW mining process is easy than POS mining process, no deposits need here to enter mining in the blockchain.
The POW mining process had more disadvantages because it is one of the old mining systems, and it consists of many problems with time passes.
This process need huge power, coin-like Bitcoin mining process huge electricity power, because of high competition to mine coin, according to an economist, Bitcoin miners alone uses about 54 terawatt-hours of electricity enough to power five million households in the US were even powered an entire country of New Zealand or Hungary can be powered with electricity.
POW mining process can be lead to 51% attack, it means in POW 51% of miners are get together they can control entire blockchain and possible to reject coin transaction and also reverse the transaction.
Above picture shows Bitcoin mining pools information, in the Bitcoin blockchain if 51% of pools get together to take control of bitcoin blockchain they can do it by not accepting transactions and demand higher fees, entering false or dual transactions.
To set up mining pools is one of the expensive processes, not everyone can do it, so POW can be expensive in popular and high demanded coins, because of high transactions miners need more power and hardware.
POW make blockchain more centralize than decentralizing, like 51% attacks only some percent of people can control blockchain.
Instead of a number of disadvantages, POW is still one of popular mining method and most of the cryptocurrencies using this method like Bitcoin, Monero, Dash list goes on, but changes are needed because POS (Proof Of Stake) is particularly interesting because a growing portion of the cryptocurrency arena is trending toward it presently.