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PoW
(Proof of Work)
PoW (Proof of Work) is a blockchain consensus mechanism where miners compete to solve complex cryptographic puzzles to validate transactions and create new blocks (e.g., BTC). Requires massive computational power, driving high energy use (~0.5% of global electricity for Bitcoin).
PoW secures networks via economic incentives—attackers must control 51% of hash power, which is prohibitively expensive for large chains. Critics highlight environmental concerns (Bitcoin's annual CO2 equals Greece's), prompting shifts to PoS. China's 2021 mining ban illustrated PoW's geopolitical vulnerabilities. The SEC favors PoW chains (considered commodities) over PoS chains (potential securities).
PoW secures networks via economic incentives—attackers must control 51% of hash power, which is prohibitively expensive for large chains. Critics highlight environmental concerns (Bitcoin's annual CO2 equals Greece's), prompting shifts to PoS. China's 2021 mining ban illustrated PoW's geopolitical vulnerabilities. The SEC favors PoW chains (considered commodities) over PoS chains (potential securities).