How are Bitcoins or any cryptocurrency produced? Where do they get stored? Some of the questions must have bothered you when you first came to know about blockchain-based digital currency. Your troubles might have been added that though these are digital coins, but miners are spending hours and hours to verify them. Minning? Is it a physical commodity? So much confusion! Let us start with the basics. Digital currency is based on the decentralized blockchain technology. When the transaction takes place between two persons involving cryptocurrency, then a complex mathematical algorithm needs to bee solved by miners or participants interested and equipped to solve it and connected to the network. Once the miners validate and update the transaction, it got added in the form of a verified transaction block further extending the blockchain. This process is called mining. In return for validation, miners are rewarded with a fixed number of Bitcoins and incentivized with transaction fees also. But who validates the block? Are some rules associated with mining? In this article, you will learn about the consensus mechanism of Proof-Of-Work or rules associated with mining and also came to know about the best proof of work coins 2020.
Now when you came to know about the process of mining, let us move forward with a consensus mechanism (a fanciful term used for some of the rules associated with mining). The consensus algorithm of proof-of-work is associated with our very first cryptocurrency or Bitcoin. PoW is a mechanism in which the number of miners compete against each other to verify the transaction and get proof of work rewards. All participating nodes or computers (of miners) have accessibility of distributed ledger or blockchain. As it is based on a decentralized model, thereby anyone can verify the information or transaction without any intermediary. The more computing power (hash rate) a computer possesses, the more complex algorithms can be solved by the miners, and hence the chances to win rewards also increase. As miners perform computation work in solving mathematical algorithms, hence the mechanism is known as Proof-of-work.
Let us find out the best proof of coins 2020 having the potential of high trading volume, better prices, and most importantly can help you to become a millionaire!
You must be well aware of the popular currencies of crypto space, but maybe don’t know about the mechanism behind it. So, let us just list out some of the best proof of work cryptocurrencies( already known to you!) are not dying in the near future and have a high probability to earn you profits.
Bitcoin synonymously used as cryptocurrency is based on Proof-of-work mechanism. Blockchain-based BTC offered an alternative to the traditional payment system with its decentralized transparent and secured model. Undoubtedly it has the highest of the trading volume with unbeatable market capitalization. You need not worry about the credibility of coins as it stands at the top proof of work cryptocurrencies, rather you just need to analyze the crypto market to invest in BTC at the correct time.
Ethereum blockchain with their native coins Ether is based on consensus of Proof of work. It is considered that ETH was born to improve the cryptocurrency market or version 2. It introduced the concept of smart contracts and engage the community to develop decentralized Apps or DApps. ETH is also one of the cryptocurrency, on which you can invest and expect for the huge profits( if technical analysis done carefully!)
Another popular cryptocurrency based on Proof of work mechanism is Litecoin which enables minimal cost payments (almost zero transaction fees). With improved storage efficiency, peer-to-peer cryptocurrency allows individuals to own and control their own crypto coins. It stands among the best proof of work coins 2020 due to its high liquidity, trading volume, and ease of transaction.
Like Bitcoin, Zcash works according to the consensus mechanism of Proof-of-work but unlike BTC, it ensures the complete confidentiality of your transaction data, thereby maintaining complete anonymity. It supports transparent transactions with zero-knowledge proofs mechanism which allows selective disclosure of information. ZEC is widely accepted by the crypto community since its launch.
Ravencoin is based on the fork of the Bitcoin and similar to Bitcoin, it is PoW based cryptocurrency. It has widespread popularity due to the higher block rewards, lower transaction completion time, and plenty of availability of coins(less complex algorithm).RVN is one of those Proof of work cryptocurrencies, which works on a fully decentralized model, thereby assuring complete anonymity and privacy.
One of the best pow cryptocurrencies, Monero is meant for seamless and smooth borderless transactions with minimal transaction fees involved. XMR assures that no one traces your activity and your coins remain completely safe and secured. With ringed signatures, ring confidential transactions, and stealth addresses for the purpose to obfuscate origins and destinations, complete decentralization is assured.
There are many other POW based cryptocurrencies like Ethereum Classic, Bitcoin SV, Bitcoin ABC, Dash, Decred, etc, which are also amongst the top pow cryptocurrencies and have enough ability to help you gain the expected profits from your investments (Though can take more time!)
Proof Of Work is the pioneer to cryptocurrency and is the base for the majority of cryptocurrencies even though quite a few number of mechanisms are being introduced by developers. PoW is one of the consensus mechanism is significant for the crypto community due to the method deployed of using computational power and less susceptibility to malicious attacks while maintaining a high level of privacy. Until the more reliable and user-friendly mechanism become widespread, most of the crypto coins are likely to deploy the PoW mechanism to validate blocks. Either you are a beginner or an advanced trader, you must diversify your crypto portfolio or rebalance your holdings by selecting a few from the best Proof of Work Coins 2020. Coins given in the list are likely to profit you in the near future if you analyze and invest.
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