Proof-of-burn is an attempt at creating a system that can prevent fraudulent transactions on a blockchain and can also improve the overall efficiency and functioning of the blockchain.
Proof-of-burn is an attempt at creating a system that can prevent fraudulent transactions on a blockchain and can also improve the overall efficiency and functioning of the blockchain.
Now, due to the fact that this is autonomous and given the decentralized nature of blockchain networks, an automated mechanism is required in order to ensure that the nodes agree on truly valid transactions. This is a task that is typically performed by consensus mechanism algorithms.
Proof-of-Burn is a consensus mechanism that attempts to resolve the high energy consumption issues that plague PoW-based blockchains.
This is a process that does not consume many resources, and therefore energy, and also ensures that the network can remain as active and as agile as possible. Miners are allowed either to burn the blockchain’s native currency or the currency of an alternative chain. In the latter case, they receive a reward in exchange, which is denominated in the native currency of the blockchain.
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