Definition
Proof of Burn (PoB) is a mechanism in which participants permanently destroy cryptocurrency to earn the right to validate blocks or to bootstrap a new token. Proposed by Iain Stewart in 2012 as an energy-light alternative to proof-of-work, it reframes the sacrifice: instead of burning electricity, participants burn coins. This entry is educational; Bitcoin's own consensus does not use PoB.
Eater addresses
Coins are burned by sending them to a verifiably unspendable destination known as an eater or burn address. Such addresses are valid in format but were not derived from any private key, so no one can ever move the funds out. Because a Bitcoin address cannot be reverse-engineered into its private key, the destruction is provable and irreversible, which is what gives the act its cost.
Rationale and uses
The logic is that burning signals a credible long-term commitment: a participant accepts a certain short-term loss in exchange for ongoing rights or rewards, much as a miner accepts an electricity bill or a staker locks collateral. Beyond consensus, the same eater-address technique is widely used to provably remove tokens from supply, and historically to migrate value from one chain to another by burning on the old chain to claim on the new one.
Compare the costs imposed by other designs in Proof of Stake, and see the work-based model Bitcoin relies on in Nakamoto Consensus.
In Simple Terms
Proof of Burn (PoB) is a mechanism in which participants permanently destroy cryptocurrency to earn the right to validate blocks or to bootstrap a new…