In a completely distributed system where malicious participants are trying to attack the system, you need some kind of mechanism to get a consensus about the st

In a completely distributed system where malicious participants are trying to attack the system, you need some kind of mechanism to get a consensus about the state of the world. Obviously, a simple majority vote wouldn't work because an attacker could cheaply spawn many nodes on the network. In bitcoin this is solved by tying the "vote" to proof of work: the explicit assumption is that the majority of the computing power is controlled by participants who aren't trying to attack the system. There is another mechanism that could reduce the need for proof-of-work though: the participants could instead show proof-of-stake[1], i.e. prove that they control a certain amount of currency. Somebody has created ppcoin[2] (a bitcoin fork) to experiment with this. [1] https://en.bitcoin.it/wiki/Proof_of_Stake https://en.bitcoin.it/wiki/Proof_of_Stake [2] https://ppcoin.org https://ppcoin.org