Consensus

A consensus mechanism is the system by which a distributed network of nodes agrees on which transactions are valid and the current state of the blockchain. Without a central authority, consensus mechanisms enable trustless agreement among potentially adversarial parties.

Why Consensus Matters: - Prevents double-spending - Ensures all nodes have the same ledger copy - Determines who can add new blocks - Defines network security model

Major Consensus Mechanisms:

Proof of Work (PoW): - Miners compete to solve cryptographic puzzles - First to solve adds the block, earns reward - Used by Bitcoin, Litecoin - Highly secure but energy-intensive

Proof of Stake (PoS): - Validators stake tokens as collateral - Selected to propose blocks based on stake - Slashing punishes malicious behavior - Used by Ethereum, Cardano, Solana

Delegated Proof of Stake (DPoS): - Token holders vote for delegates - Delegates validate on behalf of voters - Higher throughput, more centralized - Used by EOS, Tron

Proof of Authority (PoA): - Known validators approved by network - Fast and efficient - Less decentralized - Used by private/consortium chains

Byzantine Fault Tolerance (BFT): - Nodes vote on block validity - Can tolerate up to 1/3 malicious nodes - Many variants (PBFT, Tendermint) - Used by Cosmos, some enterprise chains

Consensus Trade-offs (Blockchain Trilemma): - Security vs. Decentralization vs. Scalability - Different mechanisms prioritize different properties