Consensus in cryptocurrency refers to the general agreement among participants in a network regarding the validity of transactions. It is achieved through a set of rules and protocols that help in confirming and validating transactions on the blockchain.
In simpler terms, consensus ensures that all participants in the network agree on the order and validity of transactions, preventing fraud or double spending. This agreement is essential for maintaining the integrity and security of the blockchain.
Various consensus mechanisms, such as Proof of Work (PoW) and Proof of Stake (PoS), are used in different cryptocurrencies to achieve consensus. These mechanisms require participants to contribute resources or stake their cryptocurrency to validate transactions and secure the network.
Overall, consensus plays a crucial role in maintaining trust and security in the cryptocurrency ecosystem by ensuring that all participants agree on the state of the blockchain. It is a fundamental aspect of how cryptocurrencies operate and ensure the integrity of the decentralized system.
