- Learn how Satoshi Nakamoto use Proof-of-Work and built-in incentives to achieve decentralized consensus
In a decentralized network anyone can join. We need a way to choose who gets to validate transactions and submit blocks. Randomly choosing nodes doesn't work because it's cheap to create lots of nodes to overwhelm the network. We need something expensive and hard to obtain. This is the "work" part of Proof of Work. Nodes need to solve a computationally hard puzzle which takes time and energy to solve. When nodes solve the puzzle they can then use this proof of this work to the network in order to be able to submit the next block on the chain. Because it takes time and energy to solve these puzzles, there is a cost to doing so. There are also rewards for correctly solving puzzles and creating valid blocks, so people like to play this game.
Techcoins: nakamoto consensu guide and visualization - Has pictures.