Week 9: PoW Security
Hello everyone and welcome to week nine of my blog.
I think it is important to analyze how the popular algorithm proof of work actually maintains security. I mentioned in one of my earlier posts that the security from proof of work is held in the chain’s ability to constantly utilize the longest chain or the one that is most recently updated. This is able to happen because there is an inherent cost of elapsed time that comes along with mining through hashing. Most Blockchains adjust the difficulty of finding a proper hash in order to keep a consistent time duration between new blocks getting added based on the number of miners on the chain. This means that it’s always difficult to find a new block. However, the process of finding a single block still relies on an aspect of randomness. A group of malicious actors could fork a blockchain and get lucky by randomly finding a block faster than the other participants on the chain but as long as the malicious actors make up < 51% of the miners it is mathematically impossible to consistently out pace the truthful miners. They would need to reliably find proper hashes faster than every other node in the network and, as time goes on, based on statistics this couldn’t happen. If malicious actors made up more than 51% of the chain they would lose their incentive to lie because the whole chain would become worthless. This is an excellent example of incentives guiding the chain towards honesty. This is something to consider when making new algorithms.