• shreya chaudhary

Different Consensus used in Blockchain

Updated: Jan 31

Voting is one of the best ways we could get a group to agree on something. Since this pandemic era we have been forced to go online in every way possible, whenever we are asked to vote upon something, whether it is on a live stream, a team meeting, or a college lecture, agreeing to a certain decision in a meeting has now been simplified to a +1 or a simple tick mark. This small action is enough to let others know that we give our consent for the decision.

Since Blockchains are decentralized and there is no such central authority that will take care of how things are done or how the decisions are made?

For that sole reason we have consensus mechanisms, these vary for each blockchain. We need to understand what a consensus mechanism is: In simpler words, it's a mechanism that is used to get trust, agreement, and security from the users of the network. It uses a number of methodologies, to verify and authenticate every transaction on the blockchain. There is a public ledger where people can add all of their transactions the consensus mechanism makes sure nobody is adding a fraudulent or fake transaction on it, making sure it's genuine and agreed upon by all the other members who are on the network.

Let us discuss some of the common consensus mechanisms that are used by different blockchains.

1. Proof of Work

It is a simple protocol that asks every block to give the proof of work done and verifies it, if the block qualifies then the user is given the right to add the block to the blockchain. It uses a hash function, which returns a distinct value for every distinct input. This hash function produces a number, and the block that produces the number with a specified number of trailing zeros is known as a nonce. Every transaction is signed with a private and a public key. It is designed in a way that is similar to a public ledger and uses the computational resources of a note for complex calculations.

For mining a bitcoin, a cryptographic puzzle needs to be solved in order to find a number using a hash function that will have a specific number of trailing zeros. It is safer than PoS or any other protocol.

Blockchains that use this consensus are Bitcoin, Litecoin, Ethereum, Bitcoin Cash, Monero, etc


  • This consensus consumes a lot of energy and is not very eco-friendly. A lot of time and energy is used up in solving the cryptographic puzzle.

  • If an entity controls 51% of Bitcoin's hash rate, then it can openly disregard the rules and regulations.

  • Miners form a mining pool and make the system centralized.

2. Proof Of Stake

This consensus is kind of a reward-based system, in this mechanism, a validator is picked at random and will be given a block, the miner has to pay some fees from his cryptocurrency, and then they have to check the given block, if they find a block that can be added to the blockchain the validators get the amount they paid back, they also get the transactions fees. Here the responsibility of maintaining the public ledger is distributed among the participants. Here the validator is selected according to their economic stake, this avoids centralizations. It is an environmentally friendly mechanism, faster than PoW, as well as costs very little.

Blockchains that use this consensus are Cardano, Cosmos, Polkadot, Solana, etc.


  • It is known to be less secure, attackers only need to possess greater than 50% of the currency to gain control over the currency

  • There can be a bride attack where the transactions of the victims can be reversed by the attacker and they can then bribe the miners to validate the transaction.

3. Proof of Capacity

This consensus mechanism uses allows the nodes (the systems connected in a network), to use their available space on the hardware, it uses this space to store the possible solutions of the hash function even before the mining process starts. It is just like a lottery, the more space you have the more possible solutions you have as a miner, and this means that there are more chances of finding the matching hash, and this also means you have more chances of winning the incentives.

The list of possible nonce values on the hardware are paired into scoops, the adjacent hashes like hash 0 and 1 will form a pair or a scoop 0, they are combined to form a pair. During mining, a scoop is generated by the miner and then the deadline or the time in second that has been elapsed since the last block was created is calculated for each nonce. The nonce with a minimum deadline is selected, if no one else has a block then the miner can create a block and add it to the chain. It is more efficient than PoW and PoS

Blockchains that use this consensus are Storj, Chia, Burst, Spacemint, etc.


  • If it was widely used then there would be a huge demand on the hardware industry to produce large capacity hard disks.

  • This isn't adopted by many developers yet.

4. Proof Of Elapsed Time

Proof Of Elapsed Time is another energy-efficient consensus that reduces resource and energy consumption. This mechanism works on permissioned blockchains, where every user has to identify themselves before joining. The consensus works like a lottery system as well, here the algorithm randomly generates a wait time for each node that will choose who gets the mining authority and will intern win the mining block. This gives a fair chance to every node on the network. A node will sleep till the assigned wait time, and hence it can switch to other tasks during that time. The node with the least sleep time wakes up first and will win the mining authority, create a block and add it to the chain.

The blockchain that uses this consensus is Hyperledger Sawtooth.


  • There is a lack of standardization, hence it is exposed to many vulnerabilities

  • It's dependent on specialized hardware

5. Proof Of Activity

A blockchain consensus that ensures authentication of each transaction as well as gains the consent of all miners. It is a combination of Proof of Work and Proof of Stake. The best part about this algorithm is that it increases the difficulty level of mining a block as time passes, making it very difficult to be hacked. The starting of the mining process is very similar to Proof Of Work, where the miners compete using the higher computational power of their system to find a new block, after this the process switches to Proof Of Stake. The block now has a header and reward address, based on this a group of validators is selected and are required to validate this new block. Now here the more coins the validator has the more chances they get to win this block and add it to the chain.

Decred is the cryptocurrency that uses this consensus algorithm


  • Consumes more energy as well as costs more.

  • The coin hoarding problem still exists and can cause the virtual accumulation of the currency.

We have seen different kinds of consensus mechanisms and taken a closer look at the working process. We have also seen the blockchains or the cryptocurrencies that use these mechanisms use these consensus algorithms. We have also tried to list down some of their shortcomings. A consensus plays an important part in gaining the consent of each miner or validator available on the network, this helps in keeping the blockchain decentralized and keeps maintaining a democratic process. It also adds a layer of security, to avoid fraud and hacking. I hope you guys have taken a short ride through the world of consensus mechanisms and are evoked your curiosity to look into other consensus mechanisms too!

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