Consensus is the process by which a group of peers — or nodes — on a network determine which blockchain transactions are valid and which are not. Consensus mechanisms, on the other hand, represent the rules that govern the block verification process on a blockchain.
Consensus mechanisms, also referred to as consensus protocols or consensus algorithms, form the backbone of all cryptocurrency blockchains. This mechanism validates transactions for cryptocurrencies like Bitcoin and Ethereum, helping to protect networks from malicious behaviour and hacking attacks.
The first-ever consensus mechanism was introduced alongside the conception of Bitcoin in 2008. This consensus mechanism is now known as the Proof of Work (PoW) protocol. Some of the biggest cryptocurrencies today use similar protocols, such as Proof of Stake (PoS) and Proof of Authority (PoA).
For a deeper dive into the differences between PoW and PoS, read Proof of Work vs Proof of Stake.
