Proof of Work (PoW)
By CoinGecko | Updated on Mar 03, 2020
An algorithm that rewards the first person that solves a computational problem (i.e. mining) to achieve distributed consensus. Miners compete to solve difficult cryptographic puzzles in order to add the next block on the blockchain. It prevents spam and cyber attacks such as DDoS as it requires work (i.e. processing time) from the service requester.
Related Terms
Fully Diluted Valuation
Fully Diluted Valuation (FDV) is the theoretical market capitalization of a coin if the entirety of its supply is in circulation, based on its current market price. The FDV value is theoretical as increasing the circulating supply of a coin may impact its market price. Also depending on the tokenomics, emission schedule or lock-up period of a coin's supply, it may take a significant time before its entire supply is released into circulation.
Secure Asset Fund for Users (SAFU)
A feature created by Binance which contains reserve funds that can be used to reimburse users in case of a catastrophic event (eg. exchange hack)
Bagholder
A person who is holding a large quantity of cryptocurrency which is declining in value or becoming worthless
Mining Rig
A dedicated hardware to mine
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