Explain Proof of Work (PoW) and how it works.

Proof of Work is a consensus mechanism where miners compete to solve computationally intensive puzzles to validate transactions and create new blocks.

How it works:

1. Transaction collection: Miners gather pending transactions
2. Puzzle solving: Miners search for a nonce (number used once) that when hashed with block data produces a hash with specific properties (e.g., leading zeros)
3. Block creation: First miner to solve the puzzle broadcasts the new block
4. Verification: Other nodes verify the solution and accept the block
5. Reward: Successful miner receives block reward and transaction fees

Example: Bitcoin uses SHA-256 hashing where miners must find a nonce that produces a hash starting with a certain number of zeros.