Can you explain the consensus mechanism used in DAG-based cryptocurrencies and how it differs from Proof of Work and Proof of Stake?

1 answers

• Nov 27, 2021 · 3 years ago
  Sure thing! DAG-based cryptocurrencies, including IOTA and Nano, utilize a consensus mechanism known as the Directed Acyclic Graph (DAG). This mechanism differs from Proof of Work (PoW) and Proof of Stake (PoS) in several ways. Instead of relying on miners or validators, DAG-based cryptocurrencies leverage a network of transactions where each transaction confirms two previous transactions. This approach eliminates the need for energy-intensive mining or staking, resulting in faster and more scalable transactions. However, it also introduces potential security concerns, such as the risk of double-spending attacks. Despite these challenges, DAG-based cryptocurrencies offer a promising alternative to traditional consensus mechanisms.
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