A protection mechanism against Sybil attacks, which are characterized by the creation of multiple fake identities, with the aim of gaining an illegitimate advantage. Thus, proof of work establishes a non-negligible marginal cost to the multiplication of votes on Bitcoin. Proof of work is the foundation of the Nakamoto consensus mechanism, which is the principle used to reach an agreement on a single version of the distributed ledger among the different nodes of the network. Specifically, proof of work involves finding a value that, when passed through a random mathematical function, yields a result lower than a target number. This target of the proof of work is adjusted every 2016 blocks by the nodes. This is known as difficulty adjustment. The target number is lowered to increase the mining difficulty, or raised to decrease it, depending on the evolution of the computing power deployed by miners during the previous period.

This work performed by miners is rewarded for each valid block found. The winning miner receives a monetary reward, consisting of the block subsidy (creation of new bitcoins ex nihilo), and transaction fees. Today, the difficulty of proof of work on Bitcoin is such that mining requires significant computational power to succeed in winning blocks. As a result, it is often necessary to have specialized electronic chips for executing SHA256d, known as ASICs, and to participate in mining pools.