What Is Byzantine Fault Tolerance?

By Lyle Daly – Updated Oct 8, 2025 at 3:10 AM

Key Points

Byzantine Fault Tolerance ensures crypto systems run despite some nodes failing or being deceptive.
It is critical for blockchains, helping them function even with sabotaged or faulty nodes.
Investors should note that different consensus algorithms incorporate Byzantine Fault Tolerance.

One of the hallmarks of cryptocurrency is its decentralized nature. A distributed group of nodes verifies and records transactions, allowing cryptocurrencies to operate without a central party governing them. For this to work, each cryptocurrency needs a way to achieve a consensus. That's where Byzantine Fault Tolerance comes into play.

While it's not the most widely discussed aspect of crypto, Byzantine Fault Tolerance is among the most important. Here's everything you need to know about what it is and why it's so critical.

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Blockchain Node

A blockchain node is a device, usually a computer, that participates in a blockchain network.

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Proof of Work

The proof-of-work system is the original algorithm in a blockchain network used by Bitcoin, among other popular crypto coins.

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About the Author

Lyle Daly is a contributing Motley Fool stock market analyst covering information technology and cryptocurrency. Lyle has been a contributor at the financial services company since 2018. His work has been featured on USA Today, Yahoo Finance, MSN, Fox Business, and Nasdaq. Before joining The Motley Fool, he wrote for financial brands including Intuit.

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@LyleDaly

Lyle Daly has positions in Bitcoin. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.

Pros and cons to practical Byzantine Fault Tolerance

There are a few valuable benefits of practical Byzantine Fault Tolerance:

It doesn't require significant computing power or energy usage because there aren't any miners solving complex equations for every block of transactions. This makes it much more environmentally friendly than proof of work.

Transactions don't require multiple confirmations. If the nodes are in agreement about a block of transactions, then it's confirmed immediately.

Since all nodes can get in on the action, they can all share in the rewards. There isn't such variance between which nodes earn rewards like there can be in proof of work and proof of stake.

No solution is perfect, and practical Byzantine Fault Tolerance also has some notable pitfalls:

It's vulnerable to Sybil attacks (named after a book about a woman with a multiple personality disorder), where one party is able to get control of a large portion of nodes. The more nodes there are, the harder it is to launch a Sybil attack.

It requires communication between nodes at every step of the process. This takes time, which can be a problem from a scalability standpoint.

A blockchain may not have every node working correctly at times, and there will always be bad actors who try to manipulate transactions. Each cryptocurrency has a consensus algorithm designed to help it achieve at least some degree of Byzantine Fault Tolerance. As a general rule, these algorithms allow the cryptocurrency to run normally as long as at least two-thirds of its nodes are functioning properly.

What Is Byzantine Fault Tolerance?