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General TradingC
Consensus Algorithm
A consensus algorithm is a mechanism used in blockchain and distributed systems to achieve agreement among nodes on the current state of the ledger. Common examples include Proof of Work (PoW), Proof of Stake (PoS), and Delegated Proof of Stake (DPoS), each offering different tradeoffs between security, decentralization, and energy efficiency.
Example
“Bitcoin uses the Proof of Work consensus algorithm, requiring miners to solve complex mathematical puzzles to validate transactions and add new blocks to the chain.”