A technical discussion between many cryptocurrency communities on what can anchor web3. Here is how Bitcoin POW (proof of work) could anchor web3.
The key features of cryptocurrency are the need to transact either peer-to-peer or contract convention without the involvement of any financial institution or intermediaries. With cryptocurrency running on the Blockchain, it enables the full fledge of this feature with the power behind Blockchain.
Is Web3 as a decentralized system enough? Probably YES, but in the depth view, it will be NO. A decentralized system will always want to transact and perform a deforming task without the help of any intermediary, and it's not possible, but it's blockchain.
Through the use of blockchain, a decentralized system or a web3-based system can uplevel its decentralization through the use of blockchain proof of work (POW). All decentralized networks used by cryptocurrency networks, DeFi applications, and systems are not based on a central governing authority, so they make use of proof of work to have the trust of new data.
A technical breakthrough to a more decentralized system
Bitcoin proof of work (POW) has been said to be a top-level technical ability of the Blockchain. This is a way blockchain adds a new transaction block to an already existing cryptocurrency blockchain. No centralized gatekeepers to verify and validate the authenticity of new transactions and data added to the blockchain.
The concept of proof of work was first collected in 1993 by two researchers: Moni Naor and Cynthia Dwork. But later, Satoshi Nakamoto applied this concept to blockchain in a way that a hash string or character is generated to another hash that matches the target hash for the current block.
The need for restricting and avoiding double transactions is crucial in a decentralized cryptocurrency network; it has no authority like other late conventional traditional systems. This is best accomplished on blockchain by a consensus mechanism which is a system that allows all the machines in a crypto network to agree on which transactions seem legitimate.
The one key factor
One of the top downgrading factors that had stopped the development of our digital currency back then was known as the double-spend problem. Cryptocurrency is made of data, so there needs to be a protocol mechanism to prevent users from double-spending.
Proof of work as a consensus mechanism has the power to choose a network participant called miners; through the power of POW, miners are permitted to verify new data and get some reward of integrity.
Amaury Sechet, the founder of the cryptocurrency eCash, once said: "it is a software algorithm used by Bitcoin and other blockchains to ensure blocks are only regarded as valid if they require a certain amount of computational power to produce, It’s a consensus mechanism that allows anonymous entities in decentralized networks to trust one another."
Proof of work as a term was first used by Ari Juels and Marcus Jacob in one of their publications in 1999. Proof of work is a technical solution that is difficult to find but easy to verify through its activity in the blockchain.
Why should Blockchain anchor web3?
By understanding proof of work, you could see how it is being implemented in many coins using cryptography today, the idea behind a user never being able to alter a transaction after being registered.
You must have probably spent some bucks on many different purchases. With a formal system, anyone can imagine how you could spend your digital bills twice or more by duplicating a computer file. This has already been done by many hackers who will sell a digital money balance that they were able to duplicate less or more.
The blockchain consensus mechanism has solved the double spending problem through the use of POW. And with miners testing and verifying the integrity of the chain, maybe it's possible to duplicate transactions like before. Still, it has never been possible because a new hash is generated for every specified minute.
The more miners, the higher the increase in its security and power. Because it will increase the amount of the involved processing power, it will become impossible for small people or any group to alter or meddle with a valuable cryptocurrency's Blockchain. Blockchain's POW is security tested by many virtual miners around the world competing to be the first to solve a math puzzle. The winner stands to update the blockchain with the latest transactions, and the miner will be rewarded by the network with some amount of
Why proof of work?
With the advantage of POW in the Blockchain, it has given us a powerful advantage to enhance our decentralization. Bitcoin and other highly valuable Cryptocurrencies have also been maintained with purely proof of work. And so do many decentralized systems, finance, and industries that have been maintaining a more secure decentralized blockchain.
The algorithm needs no further or more mechanisms to execute its protocol. There is less or no need for an authority to lay down the protocol for the system and penalties for wrong activities. Bitcoin and many other Cryptocurrencies that make use of blockchain proof of work have been testing the test of time that is supporting hundreds of millions in their economic activity or transaction through the protected algorithm of POW.
Bitcoin POW is objected to as a system of peering at people based on their subjective goals and aims. The node is easily set to identify the inline chain to peer or follow with sorting for another party or seeking permission from it. And the time follows the most easily accessible and identifiable one. It's already a setup system for it that even a dead Node or chain when revived, can easily identify the best chain.
POW is also keen to be multifaceted by connecting the physical and digital worlds. It has never been seen as a mere digital abstraction but as a more realistic system that secures its physical properties digitally. And it has been proven that the algorithm uses the laws of physics to successfully manipulate an independent body for the blockchain and its relative components.
A dictating opinion is closer to how the traditional system worked before. Upon that, it is less or not secured with the proper measure to guide the protocol and subjective ways from users.
But with Blockchain, web3 decentralization can be assured of more security that will make web3 an ultimate and unalterable internet where we transact with ease and trust of no corruption or damage loss. With Blockchain proof of work (POW), web3 can skyrocket to the next level to ensure more and total decentralization.