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The Proof of Authority Consensus Mechanism
The cryptocurrency space has witnessed many innovations ever since Bitcoin hit the scene. These include consensus mechanisms such as proof-of-stake (PoS) and proof-of-authority (PoA), which serve as alternatives to Bitcoin’s proof-of-work. These consensus mechanisms were proposed in light of criticisms pertaining to PoW’s energy consumption and scalability.
When it comes to transactions per second (TPS), Bitcoin and other PoW-based blockchains suffer from a lack of scalability. This is due to the fact that Bitcoin is based on a dispersed network of nodes that must come to an agreement on the present state of the blockchain. This implies that the majority of the network’s nodes must come to an agreement regarding verification; only then can a new block of transactions be confirmed. So, although Bitcoin’s decentralized nature provides a safe and trustless ecosystem, it also limits its ability to be employed on a broader scale. In terms of TPS, proof-of-stake blockchains typically outperform Bitcoin. PoS consensus mechanisms are among some of the most popular methods for reaching a consensus. The benefits of PoS are consequential in that they give network validators an even stronger financial incentive to act in the interests of the network. In addition, it doesn’t need a lot of processing power or sophisticated equipment, and it also allows for sharding, which significantly increases scalability for blockchain networks. PoA, on the other hand…
