Proof of Work Consensus

Imagine there are a million numbered boxes with red marbles inside. And only one of them contains a blue ball and you need to find it. There are 1 million other people in the game, and each of them has 1 million of the same boxes.

You start opening each random box, and you find the right box number 221,628 the fastest. Then you tell all the other players, they open the same box and make sure the blue ball is in it.

You get a prize for finding it. The game begins again.

In this example, each transaction in the Bitcoin network is one box; opening it is a check to see if you have enough money.

The box with the blue ball is the transaction that completes the block, for which the miner receives a reward.

You do the work, then you let other people check it, they double-check and confirm that you’re right-that’s the Proof-of-Work consensus algorithm.

As mentioned, mining cryptocurrency requires a lot of expensive equipment.

What to do if you want to engage in mining, but don’t want to take 100% of the costs and risks? Cloud Mining comes to the rescue!