Working on different principles, there are various kinds of consensus

mechanism algorithms.

A common consensus algorithm used by the most popular cryptocurrency

networks such as Bitcoin and Litecoin is the Proof of Work (POW) which

requires a participant node to prove that the work done and submitted by it

qualifies it to receive the right to add new transactions to the blockchain.

This mining mechanism of bitcoin; however, needs high energy

consumption and longer processing time.

Another consensus algorithm that evolved as a low-cost, low-energy

consuming alternative to the POW algorithm is Proof Of Stake (POS)

which involves the allocation of responsibility in maintaining the public

ledger to a participant node in proportion to the number of virtual currency

tokens held by it. However, this comes with the drawback that it promotes

crypto coins saving instead of spending.

Similarly, there are other consensus algorithms like Proof of Capacity

(POC), which allow sharing of memory space of the contributing nodes on

the blockchain network. The more memory or hard disk space a node has,

the more rights it is granted for maintaining the public ledger.

Method of consensus

A dynamic way of reaching an agreement in a group is consensus. Although

voting j ust settles for a maj ority rule without giving any thought to the

feelings and well-being of the minority, a consensus, on the other hand,

makes sure that an agreement is reached which could benefit the entire

group.

The methods of finding consensus in a blockchain are the practical

byzantine fault tolerance (PBFT) algorithm, the proof-of-work (PoW)

algorithm, the proof-of-stake (PoS) algorithm, and the delegated proof-of-

stake (DPoS) algorithm.

Proof-of-work

The Proof-of-Work (PoW) is the consensus algorithm in a blockchain

network that is used by most of the popular cryptocurrency networks such

as Bitcoin and Litecoin. To receive the right to add new transactions to the