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Proof-of-Work is a method for asserting the validity of data. Bitcoin miners must submit Proof-of-Work in the form of a valid hash in order to have their block be considered valid. Proof-of-Work forces miners to expend large amounts of energy and money into producing blocks, incentivizing them to stay honest, thereby securing the network. Proof-of-Work is one of the only ways a decentralized network can agree on a single source of truth, an imperative trait for a monetary system.
Miners generate a Proof-of-Work by producing a block whose hash is smaller than a set target. A hash is a randomly generated 64-digit number, so miners must generate billions of hashes to find one that is smaller than the target. This target is dynamically set by Bitcoin’s source code. As more miners join the network, the target is lowered, making it harder for miners to find a hash lower than the target. If miners leave the network, the target is raised, making it easier for miners to find a valid hash. The algorithm that recalculates the target ensures that Bitcoin blocks are found on average every 10 minutes.