Hashcash is a proof-of-work system used to limit E-mail spam and denial-of-service attacks. Hashcash was proposed in 1997 by Adam Back and described more formally in Back's 2002 paper "Hashcash - A Denial of Service Counter-Measure".
Background
The idea "...to require a user to compute a moderately hard, but not intractable function..." was proposed by Cynthia Dwork and Moni Naor in their 1992 paper "Pricing via Processing or Combatting Junk Mail".
How it works
Hashcash is a cryptographic hash-based proof-of-work algorithm that requires a selectable amount of work to compute, but the proof can be verified efficiently. For email uses, a textual encoding of a hashcash stamp is added to the header of an email to prove the sender has expended a modest amount of CPU time calculating the stamp prior to sending the email. In other words, as the sender has taken a certain amount of time to generate the stamp and send the email, it is unlikely that they are a spammer. The receiver can, at negligible computational cost, verify that the stamp is valid. However, the only known way to find a header...