Proof of Work

A proof of work is a math verification system by which it’s costly and time-consuming to produce data, but it’s easy for others to verify that the data is correct.

Proof of work (PoW) was originally invented for computer security and as a defense against email spam. Later on it was adapted for use with cryptocurrency, most famously with Bitcoin.

Information is stored in continuously created blocks of data (blockchain) that needs to be updated and verified by decentralized participants on an ongoing basis to maintain the integrity of the system.

This system is how participants (miners) work to independently try to find the next data block (answer to the math problem). Once that’s accomplished the solution is made available throughout the network, which then verifies that it’s correct. It takes a lot of computational power to solve the math problem, or puzzle, but once it’s solved, it can be quickly verified by others.

The computational intensity consumes a lot of energy, but it’s a workable verification process and is the basis for immutable distribution, which not only establishes uncensorable money flows, but the foundation for a new paradigm of economic organization.

Stated another way, proof of work is a bridge between digital information and the physical world.