Proof of Work

Proof of Work was first described in Satoshi Nakamoto’s Bitcoin whitepaper. When miners want to generate blocks, they first need to find a specific nonce or function output. Bitcoin requires that miners find an output that ends in a number of 0s. Since there is no better way to find this output than repetitive trial and error, it can be used to allocate block rewards proportionately to the network hashing power a mine holds. Bitcoin also honors the longest chain. A high level reasoning for this is the longer the chain, the more work has been put into it. Proof of work is a vital concept in cryptocurrencies. It is at the heart of Bitcoin’ decentralisation and how miners, nodes and users can all trust one another and the ledger.