POA: Proof of Authority

Proof of Authority (POA) is an identity based consensus algorithm introduced by Gavin Wood in 2017. That compromises on the trustlessness of a blockchain to improve its scalability by requiring nodes to formally identify themselves to the network.

Requiring nodes to identify themselves gives them the ability to build reputations for responsible involvement in the blockchain’s consensus process. When a sufficient reputation has been built. Nodes are tasked as moderators responsible for the oversight and maintenance of the blockchain’s security and operations.

Instead of stake in the form of tokens like the POS model. Reputation is the collateral at stake for moderators in the POA model. 

If nodes don’t live up to their responsibilities for oversight. Their reputations are compromised and they are subject to replacement by more qualified moderators.

Because the number of nodes is limited and nodes are publicly identifiable due to the requirement for identity verification. Which makes it easier for malicious actors to target attacks. POA blockchains are viewed as a more appropriate solution for private blockchains seeking to optimize for speed and efficiency instead of security.

Further Reading Proof of Authority

What’s the Difference Between Proof of Authority and Proof of Stake?