Thread by @laishawadhwa

Hola folks 👋

Its Day 24 of #web3glossary 🚀🚀

Consensus mechanisms ensure that all the txns on the network are genuine & all participants agree on a consensus on the status of the ledger. PoS and PoW are the most commonly known.

Today we look at PoA, PoB, PoC and PoH

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Need some background on consensus algos? Check out this thread on PoS vs PoW

https://twitter.com/laishawadhwa/status/1558076636784136192?s=20&t=kValTNWI976IJu8mu_l-8A

Both PoS and PoW have their fair share of pros and cons, let's look at how other cosensus algos differ

PoA: Proof of Activity (not authority)
To verify participants blocks, it combines its tokens to allow both mining and staking. The blocks themselves do not contain transactions

They’re empty templates embedded with txn title & block reward address
The information in the txn header is used to randomly select a validator node to sign the block & confirm it to the blockchain ledger, and only token holders are eligible to be validators
Then, the network..

..security fee is split between the miners & validators involved in processing & signing the block.

📌Pros
Helps reduce the probability of a 51% attack as its structure makes it practically impossible to predict which validators will sign a block at each future iteration.

📌Cons
Significant energy is still required to mine blocks during the PoW phase of this algo, & large token holders still have a disproportionately high signing chance.

👉Used by @decredproject & @EspersCoin

PoB: Proof of Burn
Miners intentionally and permanently destroy tokens in order to obtain a proportional right to mine new blocks and verify transactions it does

The more tokens a miner burns, the higher the chance that the miner will be selected as the next block validator👀

📌Pros
👉Less power and energy consumption
👉Motivates miners to make regular transactions using cryptocurrency
👉More sustainable & doesn’t need hardware for heavy computation

📌Cons
Not an initial consensus algorithm
Requires a number of wealthy participants to burn their coins in the network

👉Used by @slmcoin & @factom

PoC: Proof of Contribution
It recognizes the contributions of all active nodes within a network during each consensus round
It relies on proprietary algorithms to track it and then grants the nodes with the highest contribution value, the right to create the next block

Within a PoC consensus mechanism, users wishing to perform an on-chain calculation must give a security deposit before doing so
Each user’s contribution level is a function of that user’s track record & stake as well as the accuracy of the calculated result for any given action

📌Pro
👉Provides an energy-efficient cryptocurrency method
👉Minimizes mining energy usage by rewarding the complexity of solving a cryptographic challenge

@buzzshownetwork uses PoC to reward its users for every action on the platform from watching, sharing to uploading videos

PoH: proof of History

This mechanism creates historical records that prove a txn occurred at a specific moment
It’s a network-wide, permissionless source of time that operates before consensus
👇👇

PoH is not a consensus mechanism but a cryptographical solution to track time by creating timestamps in a blockchain network

📌Pros
👉Near-zero fees and speedy transactions: Lower prices and faster transactions make the blockchain favorable for large transactions

👉Ensures efficient delivery and reassembly of all relevant transaction data without the need to wait for sequential block confirmations across the entire network

Used by @solana which is able to achieve extremely fast confirmation times without sacrificing security and still..

...maintaining a relative degree of decentralization. It uses both PoS and PoH, PoS lets participants stake their coins, while PoH ensures leaders of slots confirm transactions following the correct order.

That’s a wrap for Day 24!

I’ll be sharing information on the new vocabulary of the web for 30 days.

It’s like a free crash course on the terms and methodolgies in Web3.

📌Follow me @laishawadhwa for more such web3 gyaan!
📌RT the first tweet to share with more folks.