Proof of Work

Miners on a Proof of Work (PoW) blockchain have to fix a complex mathematical problem before then can complete a new block. The miner that finds the solution first can put the block on the network and is rewarded e.g. by receiving an amount of the the cryptocurrency on that blockchain.

Miners with faster computers will usually be the the first to find a block. This make mining expensive, you need the right equipment and the power to run it.

Examples of PoW blockchains are BitCoin and LiteCoin.

On the BitCoin blockchain every 10 minutes a block is created, the difficulty of the problem to fix is automatically adjusted to keep this frequency. So, more miners with fast computers, mean faster block generation, meaning greater difficulty meaning more energy or faster hardware is to be used.

The concept of Proof of Work, where is is relative hard to create the proof but simple to verify it, was invented in 1993 by Cynthia Dwork and Moni Naor.

Hashcash is a PoW implementation that is used in the Bitcoin blockchain.