Proof of Authority (PoA)
Proof of Authority (PoA)Proof of Authority (PoA) is a consensus algorithm used in blockchain networks to achieve consensus and validate transactions. Unlike Proof of Work (PoW) and Proof... More is a consensus algorithmA cryptocurrency algorithm is a set of instructions that are programmed to execute a specific task or function related to cryptocurrencies, such as mining or... More used in blockchainThe blockchain is a digital ledger that records transactions in a secure and decentralized manner. Think of it like a shared spreadsheet that is constantly... More networks to achieve consensus and validate transactions. Unlike Proof of Work (PoW)Proof of work is a consensus mechanism used in blockchain networks that allows miners to compete to validate transactions and earn rewards by solving complex... More and Proof of Stake (PoS)Proof of stake is a consensus mechanism used in some cryptocurrencies, in contrast to proof of work used by Bitcoin. In proof of stake, instead... More, PoA does not require miners to solve complex mathematical problems or stake cryptocurrencyCryptocurrency is a digital or virtual currency that uses cryptography for security and operates independently of a central bank. Cryptocurrencies use decentralized technology called blockchain... More to validate transactions. Instead, PoA relies on a group of trusted validators, known as authorities, to verify transactions and produce blocks.
In a PoA network, the authorities are usually well-known and trusted individuals or organizations that are selected by the network’s creators. These authorities are responsible for verifying transactions and adding them to the blockchain. In return for their services, authorities are rewarded with transaction fees or other incentives.
PoA is often used in private or consortium blockchains where the participants are known and trusted. It is also used in some public blockchains as an alternative to PoW or PoS.
You can use PoA-based blockchain networks to transact with others and access decentralized applications (dApps)Decentralized applications, or dApps, are applications that run on a decentralized network, such as a blockchain. Unlike traditional applications, which are controlled by a single... More built on these networks. For example, the xDai chain is a PoA-based sidechain of EthereumEthereum is a type of cryptocurrency that is similar to Bitcoin, but with some important differences. One of the key differences is that Ethereum is... More that allows for fast and cheap transactions, making it ideal for microtransactions and dApp usage.