#GENIUSActPass Proof of Reserve (PoR) and Proof of Work (PoW) are two different concepts used in the context of blockchain and cryptocurrency.

Proof of Work (PoW)

- A consensus algorithm used to validate transactions and create new blocks.

- Requires miners to solve complex mathematical puzzles, which demands significant computational power.

- The first miner to solve the puzzle gets to add a new block to the blockchain and is rewarded with cryptocurrency.

- Examples: Bitcoin, Ethereum (before its transition to Proof of Stake).

Proof of Reserve (PoR)

- A method used to demonstrate that an entity holds a certain amount of assets or reserves.

- Typically used by cryptocurrency exchanges or custodians to show their solvency and transparency.

- Involves providing cryptographic proof that the entity holds the claimed assets.

- Helps build trust and confidence in the entity.

In summary, PoW is a consensus algorithm for validating transactions, while PoR is a method for demonstrating asset holdings.