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From the day blockchain invented, it used to derive a lot of changes through out the world both technically and economically. Those who are in cryptocurrency industry may experienced these changes. When it comes to the matter of blockchain you may also heard about these words POC, POS, and POW. But only less number of people may alone know in detail about the above said concepts.
So let me discuss them in very simple manner and also let us see about POC Blockchain Development.
The above concepts POC, POW and POS are coinsidered as algorithms in blockchain industry, each having a significant different with other. Explore more Blockchain Algorithms. We know that the use of blockchain came to the spot light, only after the success of cryptocurrencies like bitcoin and ethereum. Because most of the cryptocurrenices have underlies this public and distributed ledger technology. In General cryptocurrenices like bitcoin are having a decentralized character, that is no- third party can have authority over it. Industry experts found that the only technology that can carry out the decentralization nature of these cryptocurrencies is “blockchain technology”.
So wherever the blockchain carry out its use cases it have to fulfil the decentralization nature of its own. Hence industry leaders derived Such proof based algorithms to split up the decentralized and distributed nature of blockchain technology to everyone.
In the above list POW (Proof of work ) , POS ( Proof of work )and POI are explores their full potential in Blockchain Mining Alone.
But The Proof Of Concept ( POC) is something unique which have started to rage in blockchian application development alone.
So let’s see everything in short detail
Proof Of Work (POW)
This concept was firstly used by sathosi nakamato - the inventor of bitcoin. The release of bitcoin white paper denoted that “ The only way to over come the 51% attack is Proof - of work concept”
“51% attacks is nothing but whenever a single entity control over
the 50% of the entire network hash rate, then it will be considered as 51% attack. “
Check out What is 51% Attack ?
Proof of work will prevent this attack by distributing the hash rate, and mining power through out the network. This idea was published by Cynthia Dwork in 1993, but was named as “Proof of work” by Markus jacobson in 1999.
How POW Works?
It is solely used for mining process. In Mining Process you have to solve the complex mathematical puzzles in order to search a particular crypto coin. For the miner this process will be very difficult but for the network it will be easy to check it.
And more over I just want to convey one thing, we all are thinking that “mining is solving problems”, but what mining actually is “validating a particular block” . Mining is used to check out the legitimacy of a particular appended block in the chain.
1. All the bitcoin transactions will be bundled up together in a block.
2. Miners verify the transactions within a block, about the legitimacy.
3. In order to validate or verify a block, miners have to solve several complex maths problems.
4. When a block is verified, then it will be added to the blockchain.
5. Finally the miner who solve the puzzle first will be treated as the winner, and he will be announced it to entire network.
6. The miner will be reward with a certain newly created cryptocurrency.
7. In this entire Proof of work concept miners have to set up a large mining rigs, and have to spend a lot of electricity to validate a single or particular block.
During the mining process miners have to generate a lot of assumptions in order to clear the puzzle.
Example : You have given with a key, and there are around 12 locks, so in order to open the exact lock you have the maximum probability of 11:1, So here you have to execute atmost 11 assumptions. This is what work in POW too.
So random assumptions will waste the energy of miner and the electricity consumption
Here one bitcoin transaction required to utilize the electricity consumption of 1.57 american house holds per day. ( Average size of home is ~2700 sqft)
A recent report says, that the bitcoin transactions would consume the elecritcity as whole used by the entire denmark city by 2020.
POW Allows anyone to take part in mining. So this cause the entire network to delve in the new crypto currencies, and may cause the crypto currenceis value to depreciate.
Proof of Stake (POS)
This will replace the Important of POW, By overcoming its major disadvantages.
Yes, The goal of POW and POS Are same, but how they execute the validation process alone differentiates each other. In POW, The person who solves the mathematical complex algorithms first will have the access to validate the block, and will be rewarded with points. But in POS, The person who have the highest stake holds will have the access to validate a block, and will be rewarded with transaction fees.
POW - it is just like a competition, So the miners have to compete with each other in order to validate a block, So the winner alone have access to validate the block.
POS - There will be a random selection algorithm will be execute, in order to choose the validator.
This will be done through a deterministic way, by considering the wealth (stake) of the validator.
The chosen validatore will be provided with higher hash rate and will have access to validate a block
How POS Works?
It focus on the property or stake(cryptocurrencies) of the user, irrespective of the solution to a challenge that POW Executes. As we said above the validator will chosen upon a deterministic way, which follows as below
Here the validators must place some of their holdings (ether - cyprotocurrencies ) as stake in order to prove their wealth. When the validator found a block is capable of added to the blockchain, then they will make a bet on it. Based on their wealth, or the stake they placed, the hash rate and the mining power will be distributed to the validator, Then the block will be added to the chain. Here no rewards, but the transaction fees will be provided to the validator.
Advantage of POS :
1. As the POS eliminates the puzzle solving methods, it completely diminish the usage of electricity and wasting the energy by executing random assumptions
2. It is very easy process since it doesn’t involves inany complex mathematical problems
Disadvantage Of POS.
1. Since the validating authority, power up only one entity it completely contradicts the decentralized concept of blockchain.
2. There may be a chance of single entity to create a fork on the blockchain, So to eliminate this, Casper protocol was invented.
So far we have discussed POS, and Pow. Both are exposed the use cases in validating a block alone, but POC is something different
POC is refers to the Proof of capacity. Refer more about proof of capacity here. There is also an another term for POC in blockchain devleopment that is Proof of Concept. that is what we gonna discuss below.
Proof of concept is a prototype that declares and demonstrate the possible solution to develop a blockchain application for any industry. This define the feasibility, possibilities, and the goals that could be achieved through the blockchain project. This prototype may don’t have any code, and will be executed initially with MVP (Minimum viable product) which will have the potential basic features that the blockchain project could cover.
After implementing the project to live, feedback of the MVP from initial customers will be received, and will be enhanced in order to complete the goals of the blockchain project.
This blockchain development will have 3 stages in its life cycle.
This covers the theoretical explanation of the blockchain projects through a set of proposals
Sketching the therotical explanations in to the prototype, which may consist of markups, sample archietecture, design layout, and ends in developing the MVP Product.
MVP Product development.
Based on the things discussed in the scope declaration, A fully developed MVP will be issued to the community and based on the feedback, the changes will resemble in actual deliverable.
We bitdeal helps you in developing the POC blockchain development services for any kind of industries like medical, investment, telecom, networking, insurance, banking, SCM and etc. You can hire our dedicated blockchain developers hourly/Full Time. Also we have separate ODC Team of blockchain developers who can dedicatedly work for Private Custom blockchain application development.
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Greetings! This is Dheivanai! My love for writing transformed me as a blogger and the Passion for Crypto industry turned me as a business advisor at bitdeal. Crazy towards digging deep and analyze the new trends in the Cryptocurrency and Blockchain Industry. Follow us to read interesting and existing blogs! Stay tuned, Stay updated!
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