Proof of Burn is a consensus mechanism that serves as an alternative to the Proof of Work system. PoB systems provide an alternative mining method to the PoW consensus method that requires costly, power-consuming physical equipment that has a huge environmental impact. As an alternative consensus algorithm, virtual mining rigs are used to replace physical ones.
Blockchain miners earn block rewards through coin burn and Proof of Burn Work. To make it work, miners send coins to an unspendable address to be burned and by doing so, they keep the decentralized networks active and running. Coin burning is required for miners to increase their mining power and computational resources on the blockchain network. Miners can either use the native tokens of a particular cryptocurrency or alternatives to proof coin/counterparty tokens. The more coins burned, the more the computational power of such miners.
There are several types of consensus algorithms. Bitcoin, the first cryptocurrency, uses the PoW blockchain algorithm as mining proof. There is also the proof of stake, but the proof of burn blockchain consensus mechanism has proven to be one of the most efficient so far in the cryptocurrency space.
To avoid the dominance of any miner, PoB blockchain coins decay over a period. PoB is also proving to be a good way to reduce coin inflation. It is the ultimate source of relative scarcity as block validators burn part of available coins to secure the chain over a specific time frame.