diff --git a/README.md b/README.md
index 66072e1..b5b50e1 100644
--- a/README.md
+++ b/README.md
@@ -282,6 +282,7 @@ Configuration can be set using environment variables
 | `DS_MAX_RECORD_DATA_SIZE`                         | Maximum size for `RecordsWrite` data. use `b`, `kb`, `mb`, `gb` for value                                               | `1gb`                  |
 | `DS_WEBSOCKET_SERVER`                             | Whether to enable listening over `ws:`. values: `on`,`off`                                                              | `on`                   |
 | `DWN_REGISTRATION_STORE_URL`                      | URL to use for storage of registered DIDs. Leave unset to if DWN does not require registration (ie. open for all)       | unset                  |
+| `DWN_REGISTRATION_PROOF_OF_WORK_SEED`             | Seed to generate the challenge nonce from, this allows all DWN instances in a cluster to generate the same challenge.   | unset                  |
 | `DWN_REGISTRATION_PROOF_OF_WORK_ENABLED`          | Require new users to complete a proof-of-work challenge                                                                 | `false`                |
 | `DWN_REGISTRATION_PROOF_OF_WORK_INITIAL_MAX_HASH` | Initial maximum allowed hash in 64 char HEX string. The more leading zeros (smaller number) the higher the difficulty.  | `false`                |
 | `DWN_TERMS_OF_SERVICE_FILE_PATH`                  | Required terms of service agreement if set. Value is path to the terms of service file.                                 | unset                  |
diff --git a/src/config.ts b/src/config.ts
index 4f835bb..adc5de3 100644
--- a/src/config.ts
+++ b/src/config.ts
@@ -1,6 +1,6 @@
 import bytes from 'bytes';
 
-export type Config = typeof config;
+export type DwnServerConfig = typeof config;
 
 export const config = {
   // max size of data that can be provided with a RecordsWrite
@@ -16,6 +16,7 @@ export const config = {
 
   // tenant registration feature configuration
   registrationStoreUrl: process.env.DWN_REGISTRATION_STORE_URL || process.env.DWN_STORAGE,
+  registrationProofOfWorkSeed: process.env.DWN_REGISTRATION_PROOF_OF_WORK_SEED,
   registrationProofOfWorkEnabled: process.env.DWN_REGISTRATION_PROOF_OF_WORK_ENABLED === 'true',
   registrationProofOfWorkInitialMaxHash: process.env.DWN_REGISTRATION_PROOF_OF_WORK_INITIAL_MAX_HASH,
   termsOfServiceFilePath: process.env.DWN_TERMS_OF_SERVICE_FILE_PATH,
diff --git a/src/dwn-server.ts b/src/dwn-server.ts
index c19a030..15878ef 100644
--- a/src/dwn-server.ts
+++ b/src/dwn-server.ts
@@ -7,7 +7,7 @@ import { type WebSocketServer } from 'ws';
 
 import { HttpServerShutdownHandler } from './lib/http-server-shutdown-handler.js';
 
-import { type Config, config as defaultConfig } from './config.js';
+import { type DwnServerConfig, config as defaultConfig } from './config.js';
 import { HttpApi } from './http-api.js';
 import { setProcessHandlers } from './process-handlers.js';
 import { getDWNConfig } from './storage.js';
@@ -16,12 +16,12 @@ import { RegistrationManager } from './registration/registration-manager.js';
 
 export type DwnServerOptions = {
   dwn?: Dwn;
-  config?: Config;
+  config?: DwnServerConfig;
 };
 
 export class DwnServer {
   dwn?: Dwn;
-  config: Config;
+  config: DwnServerConfig;
   #httpServerShutdownHandler: HttpServerShutdownHandler;
   #httpApi: HttpApi;
   #wsApi: WsApi;
@@ -57,7 +57,8 @@ export class DwnServer {
       registrationManager = await RegistrationManager.create({
         registrationStoreUrl: this.config.registrationStoreUrl,
         termsOfServiceFilePath: this.config.termsOfServiceFilePath,
-        initialMaximumAllowedHashValue: this.config.registrationProofOfWorkInitialMaxHash,
+        proofOfWorkChallengeNonceSeed: this.config.registrationProofOfWorkSeed,
+        proofOfWorkInitialMaximumAllowedHash: this.config.registrationProofOfWorkInitialMaxHash,
       });
 
       this.dwn = await Dwn.create(getDWNConfig(this.config, registrationManager));
diff --git a/src/http-api.ts b/src/http-api.ts
index 1a096b0..30972ae 100644
--- a/src/http-api.ts
+++ b/src/http-api.ts
@@ -14,7 +14,7 @@ import type { RequestContext } from './lib/json-rpc-router.js';
 import type { JsonRpcRequest } from './lib/json-rpc.js';
 import { createJsonRpcErrorResponse, JsonRpcErrorCodes } from './lib/json-rpc.js';
 
-import type { Config } from './config.js';
+import type { DwnServerConfig } from './config.js';
 import { config } from './config.js';
 import { type DwnServerError } from './dwn-error.js';
 import { jsonRpcApi } from './json-rpc-api.js';
@@ -24,13 +24,13 @@ import type { RegistrationManager } from './registration/registration-manager.js
 const packageJson = process.env.npm_package_json ? JSON.parse(readFileSync(process.env.npm_package_json).toString()) : {};
 
 export class HttpApi {
-  #config: Config;
+  #config: DwnServerConfig;
   #api: Express;
   #server: http.Server;
   registrationManager: RegistrationManager;
   dwn: Dwn;
 
-  constructor(config: Config, dwn: Dwn, registrationManager: RegistrationManager) {
+  constructor(config: DwnServerConfig, dwn: Dwn, registrationManager: RegistrationManager) {
     console.log(config);
 
     this.#config = config;
diff --git a/src/index.ts b/src/index.ts
index e7f3d09..e77275c 100644
--- a/src/index.ts
+++ b/src/index.ts
@@ -1,4 +1,4 @@
-export { Config } from './config.js';
+export { DwnServerConfig } from './config.js';
 export { DwnServer, DwnServerOptions } from './dwn-server.js';
 export { HttpApi } from './http-api.js';
 export { jsonRpcApi } from './json-rpc-api.js';
diff --git a/src/lib/http-server-shutdown-handler.ts b/src/lib/http-server-shutdown-handler.ts
index f97fc68..aad41a5 100644
--- a/src/lib/http-server-shutdown-handler.ts
+++ b/src/lib/http-server-shutdown-handler.ts
@@ -58,8 +58,8 @@ export class HttpServerShutdownHandler {
 
     // Stops the server from accepting new connections and keeps existing connections. This function is asynchronous,
     // the server is finally closed when all connections are ended and the server emits a 'close' event.
-    // The optional callback will be called once the 'close' event occurs. Unlike that event, it will be
-    // called with an Error as its only argument if the server was not open when it was closed.
+    // The optional callback will be called once the 'close' event occurs.
+    // The callback will be called with an Error as its only argument if the server was not open when close is called.
     this.server.close(() => {
       this.tcpSocketId = 0;
       this.stopping = false;
diff --git a/src/registration/proof-of-work-manager.ts b/src/registration/proof-of-work-manager.ts
index 5a19503..7a86b2b 100644
--- a/src/registration/proof-of-work-manager.ts
+++ b/src/registration/proof-of-work-manager.ts
@@ -11,12 +11,18 @@ export class ProofOfWorkManager {
   public static readonly defaultMaximumAllowedHashValue = '000000FFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFF';
 
   // Challenge nonces that can be used for proof-of-work.
-  private challengeNonces: { currentChallengeNonce: string, previousChallengeNonce?: string };
+  private challengeNonces: {
+    previousChallengeNonce?: string,
+    currentChallengeNonce: string,
+    nextChallengeNonce?: string
+  };
 
   // There is opportunity to improve implementation here.
   // TODO: https://github.com/TBD54566975/dwn-server/issues/101
   private proofOfWorkOfLastMinute: Map<string, number> = new Map(); // proofOfWorkId -> timestamp of proof-of-work
 
+  // Seed to generate the challenge nonce from, this allows all DWN instances in a cluster to generate the same challenge.
+  private challengeSeed?: string;
   private difficultyIncreaseMultiplier: number;
   private currentMaximumAllowedHashValueAsBigInt: bigint;
   private initialMaximumAllowedHashValueAsBigInt: bigint;
@@ -50,11 +56,13 @@ export class ProofOfWorkManager {
     desiredSolveCountPerMinute: number,
     initialMaximumAllowedHashValue: string,
     difficultyIncreaseMultiplier: number,
+    challengeSeed?: string,
     challengeRefreshFrequencyInSeconds: number,
     difficultyReevaluationFrequencyInSeconds: number
   }) {
     const { desiredSolveCountPerMinute, initialMaximumAllowedHashValue } = input;
 
+    this.challengeSeed = input.challengeSeed;
     this.challengeNonces = { currentChallengeNonce: ProofOfWork.generateNonce() };
     this.currentMaximumAllowedHashValueAsBigInt = BigInt(`0x${initialMaximumAllowedHashValue}`);
     this.initialMaximumAllowedHashValueAsBigInt = BigInt(`0x${initialMaximumAllowedHashValue}`);
@@ -77,6 +85,7 @@ export class ProofOfWorkManager {
     autoStart: boolean,
     initialMaximumAllowedHashValue?: string,
     difficultyIncreaseMultiplier?: number,
+    challengeSeed?: string,
     challengeRefreshFrequencyInSeconds?: number,
     difficultyReevaluationFrequencyInSeconds?: number
   }): Promise<ProofOfWorkManager> {
@@ -91,6 +100,7 @@ export class ProofOfWorkManager {
       desiredSolveCountPerMinute,
       initialMaximumAllowedHashValue,
       difficultyIncreaseMultiplier,
+      challengeSeed: input.challengeSeed,
       challengeRefreshFrequencyInSeconds,
       difficultyReevaluationFrequencyInSeconds
     });
@@ -143,8 +153,9 @@ export class ProofOfWorkManager {
     }
 
     // Verify challenge nonce is valid.
-    if (challengeNonce !== this.challengeNonces.currentChallengeNonce &&
-        challengeNonce !== this.challengeNonces.previousChallengeNonce) {
+    const { previousChallengeNonce, currentChallengeNonce, nextChallengeNonce } = this.challengeNonces;
+    const acceptableChallengeNonces = [previousChallengeNonce, currentChallengeNonce, nextChallengeNonce].filter(nonce => nonce !== undefined && nonce !== '');
+    if (!acceptableChallengeNonces.includes(challengeNonce)) {
       throw new DwnServerError(
         DwnServerErrorCode.ProofOfWorkManagerInvalidChallengeNonce,
         `Unknown or expired challenge nonce: ${challengeNonce}.`
@@ -195,8 +206,23 @@ export class ProofOfWorkManager {
   }
 
   private refreshChallengeNonce(): void {
-    this.challengeNonces.previousChallengeNonce = this.challengeNonces.currentChallengeNonce;
-    this.challengeNonces.currentChallengeNonce = ProofOfWork.generateNonce();
+    // If challenge seed is supplied, use it to deterministically generate the challenge nonces.
+    if (this.challengeSeed !== undefined) {
+      const currentRefreshIntervalId = Math.floor(Date.now() / (this.challengeRefreshFrequencyInSeconds * 1000));
+      const previousRefreshIntervalId = currentRefreshIntervalId - 1;
+      const nextRefreshIntervalId = currentRefreshIntervalId + 1;
+
+      const previousChallengeNonce = ProofOfWork.hashAsHexString([this.challengeSeed, previousRefreshIntervalId.toString(), this.challengeSeed]);
+      const currentChallengeNonce = ProofOfWork.hashAsHexString([this.challengeSeed, currentRefreshIntervalId.toString(), this.challengeSeed]);
+      const nextChallengeNonce = ProofOfWork.hashAsHexString([this.challengeSeed, nextRefreshIntervalId.toString(), this.challengeSeed]);
+
+      this.challengeNonces = { previousChallengeNonce, currentChallengeNonce, nextChallengeNonce };
+    } else {
+      const newChallengeNonce = ProofOfWork.generateNonce();
+
+      this.challengeNonces.previousChallengeNonce = this.challengeNonces.currentChallengeNonce;
+      this.challengeNonces.currentChallengeNonce = newChallengeNonce;
+    }
   }
 
   /**
diff --git a/src/registration/registration-manager.ts b/src/registration/registration-manager.ts
index 45a4732..d7c221e 100644
--- a/src/registration/registration-manager.ts
+++ b/src/registration/registration-manager.ts
@@ -50,9 +50,10 @@ export class RegistrationManager implements TenantGate {
   public static async create(input: {
     registrationStoreUrl?: string,
     termsOfServiceFilePath?: string
-    initialMaximumAllowedHashValue?: string,
+    proofOfWorkChallengeNonceSeed?: string,
+    proofOfWorkInitialMaximumAllowedHash?: string,
   }): Promise<RegistrationManager> {
-    const { termsOfServiceFilePath, registrationStoreUrl, initialMaximumAllowedHashValue } = input;
+    const { termsOfServiceFilePath, registrationStoreUrl } = input;
 
     const registrationManager = new RegistrationManager();
 
@@ -71,7 +72,8 @@ export class RegistrationManager implements TenantGate {
     registrationManager.proofOfWorkManager = await ProofOfWorkManager.create({
       autoStart: true,
       desiredSolveCountPerMinute: 10,
-      initialMaximumAllowedHashValue,
+      initialMaximumAllowedHashValue: input.proofOfWorkInitialMaximumAllowedHash,
+      challengeSeed: input.proofOfWorkChallengeNonceSeed,
     });
 
     // Initialize RegistrationStore.
diff --git a/src/storage.ts b/src/storage.ts
index 1b051f9..1988349 100644
--- a/src/storage.ts
+++ b/src/storage.ts
@@ -27,7 +27,7 @@ import { createPool as MySQLCreatePool } from 'mysql2';
 import pg from 'pg';
 import Cursor from 'pg-cursor';
 
-import type { Config } from './config.js';
+import type { DwnServerConfig } from './config.js';
 
 export enum EStoreType {
   DataStore,
@@ -45,7 +45,7 @@ export enum BackendTypes {
 export type StoreType = DataStore | EventLog | MessageStore;
 
 export function getDWNConfig(
-  config: Config,
+  config: DwnServerConfig,
   tenantGate: TenantGate,
 ): DwnConfig {
   const dataStore: DataStore = getStore(config.dataStore, EStoreType.DataStore);
diff --git a/tests/dwn-server.spec.ts b/tests/dwn-server.spec.ts
index 3197b91..b3e4df4 100644
--- a/tests/dwn-server.spec.ts
+++ b/tests/dwn-server.spec.ts
@@ -1,33 +1,38 @@
 import { expect } from 'chai';
 
+import type { DwnServerConfig } from '../src/config.js';
 import { config } from '../src/config.js';
 import { DwnServer } from '../src/dwn-server.js';
+import { randomBytes } from 'crypto';
 
 describe('DwnServer', function () {
-  let dwnServer: DwnServer;
+  const dwnServerConfig = { ...config };
+  
   before(async function () {
-    dwnServer = new DwnServer({ config });
+    // NOTE: using SQL to workaround an issue where multiple instances of DwnServer can be started using LevelDB in the same test run,
+    // and dwn-server.spec.ts already uses LevelDB.
+    dwnServerConfig.messageStore = 'sqlite://';
+    dwnServerConfig.dataStore = 'sqlite://';
+    dwnServerConfig.eventLog = 'sqlite://';
   });
 
   after(async function () {
-    dwnServer.stop(() => console.log('server stop'));
   });
 
-  it('should create an instance of DwnServer', function () {
-    expect(dwnServer).to.be.an.instanceOf(DwnServer);
-  });
+  it('should initialize ProofOfWorkManager with challenge nonce seed if given.', async function () {
+    const registrationProofOfWorkSeed = randomBytes(32).toString('hex');
+    const configWithProofOfWorkSeed: DwnServerConfig = {
+      ...dwnServerConfig,
+      registrationStoreUrl: 'sqlite://',
+      registrationProofOfWorkEnabled: true,
+      registrationProofOfWorkSeed
+    };
 
-  it('should start the server and listen on the specified port', async function () {
+    const dwnServer = new DwnServer({ config: configWithProofOfWorkSeed });
     await dwnServer.start();
-    const response = await fetch('http://localhost:3000', {
-      method: 'GET',
-    });
-    expect(response.status).to.equal(200);
-  });
+    expect(dwnServer.registrationManager['proofOfWorkManager']['challengeSeed']).to.equal(registrationProofOfWorkSeed);
 
-  it('should stop the server', async function () {
     dwnServer.stop(() => console.log('server Stop'));
-    // Add an assertion to check that the server has been stopped
     expect(dwnServer.httpServer.listening).to.be.false;
   });
 });
diff --git a/tests/http-api.spec.ts b/tests/http-api.spec.ts
index 0656704..f16a869 100644
--- a/tests/http-api.spec.ts
+++ b/tests/http-api.spec.ts
@@ -59,8 +59,8 @@ describe('http api', function () {
     // RegistrationManager creation
     const registrationStoreUrl = config.registrationStoreUrl;
     const termsOfServiceFilePath = config.termsOfServiceFilePath;
-    const initialMaximumAllowedHashValue = config.registrationProofOfWorkInitialMaxHash;
-    registrationManager = await RegistrationManager.create({ registrationStoreUrl, termsOfServiceFilePath, initialMaximumAllowedHashValue });
+    const proofOfWorkInitialMaximumAllowedHash = config.registrationProofOfWorkInitialMaxHash;
+    registrationManager = await RegistrationManager.create({ registrationStoreUrl, termsOfServiceFilePath, proofOfWorkInitialMaximumAllowedHash });
 
     dwn = await getTestDwn(registrationManager);
 
diff --git a/tests/registration/proof-of-work-manager.spec.ts b/tests/registration/proof-of-work-manager.spec.ts
index 8dde4ae..06354a2 100644
--- a/tests/registration/proof-of-work-manager.spec.ts
+++ b/tests/registration/proof-of-work-manager.spec.ts
@@ -6,6 +6,8 @@ import { expect } from 'chai';
 import { useFakeTimers } from 'sinon';
 import { v4 as uuidv4 } from 'uuid';
 import { ProofOfWorkManager } from '../..//src/registration/proof-of-work-manager.js';
+import { randomBytes } from 'crypto';
+import { ProofOfWork } from '../../src/registration/proof-of-work.js';
 
 describe('ProofOfWorkManager', function () {
   let clock;
@@ -59,6 +61,49 @@ describe('ProofOfWorkManager', function () {
     expect(maximumAllowedHashValueRefreshSpy.callCount).to.greaterThanOrEqual(expectedDifficultyReevaluationCount);
   });
 
+  it('should accept previous and next challenge nonce to account for server time drift when challenge seed is given.', async function () {
+    const desiredSolveCountPerMinute = 10;
+    const initialMaximumAllowedHashValue = 'FFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFF'; // always accept
+    const challengeSeed = randomBytes(32).toString('hex');
+    const proofOfWorkManager = await ProofOfWorkManager.create({
+      autoStart: true,
+      desiredSolveCountPerMinute,
+      challengeSeed,
+      initialMaximumAllowedHashValue,
+    });
+
+    const previousChallengeNonce = proofOfWorkManager['challengeNonces'].previousChallengeNonce;
+    const nextChallengeNonce = proofOfWorkManager['challengeNonces'].nextChallengeNonce;
+    expect(previousChallengeNonce?.length).to.equal(64);
+    expect(nextChallengeNonce?.length).to.equal(64);
+
+    const requestData = 'irrelevant';
+
+    // Expect to accept response nonce generated using previous challenge nonce.
+    const responseNonceUsingPreviousChallengeNonce = ProofOfWork.findQualifiedResponseNonce({
+      challengeNonce: previousChallengeNonce,
+      maximumAllowedHashValue: initialMaximumAllowedHashValue,
+      requestData
+    });
+    await proofOfWorkManager.verifyProofOfWork({
+      challengeNonce: previousChallengeNonce,
+      responseNonce: responseNonceUsingPreviousChallengeNonce,
+      requestData
+    });
+
+    // Expect to accept response nonce generated using next challenge nonce.
+    const responseNonceUsingNextChallengeNonce = ProofOfWork.findQualifiedResponseNonce({
+      challengeNonce: nextChallengeNonce,
+      maximumAllowedHashValue: initialMaximumAllowedHashValue,
+      requestData
+    });
+    await proofOfWorkManager.verifyProofOfWork({
+      challengeNonce: nextChallengeNonce,
+      responseNonce: responseNonceUsingNextChallengeNonce,
+      requestData
+    });
+  });
+
   it('should increase difficulty if proof-of-work rate goes above desired rate and reduce difficulty as proof-of-work rate falls below desired rate.', async function () {
     const desiredSolveCountPerMinute = 10;
     const initialMaximumAllowedHashValue = 'FFFFFFFF';
diff --git a/tests/scenarios/registration.spec.ts b/tests/scenarios/registration.spec.ts
index ed5d1ee..fc16080 100644
--- a/tests/scenarios/registration.spec.ts
+++ b/tests/scenarios/registration.spec.ts
@@ -377,12 +377,15 @@ describe('Registration scenarios', function () {
     expect(registrationResponseBody2.code).to.equal(DwnServerErrorCode.ProofOfWorkManagerInvalidResponseNonceFormat);
   });
 
-  it('should reject a registration request that uses an expired challenge nonce', async () => {
+  it('should reject a response nonce based on an expired challenge nonce and accept one is based on the new challenge nonce', async () => {
     // Scenario:
     // 0. Assume Alice fetched the terms-of-service and proof-of-work challenge.
     // 1. A long time has passed since Alice fetched the proof-of-work challenge and the challenge nonce has expired.
     // 2. Alice computes the proof-of-work response nonce based on the the proof-of-work challenge and the registration data.
     // 3. Alice sends the registration request to the server and it is rejected.
+    // 4. Alice fetches the new proof-of-work challenge.
+    // 5. Alice computes the proof-of-work response nonce based on the the new proof-of-work challenge and the registration data.
+    // 6. Alice sends the new registration request to the server and it is accepted.
 
     // 0. Assume Alice fetched the terms-of-service and proof-of-work challenge.
     const termsOfService = registrationManager.getTermsOfService();
@@ -421,6 +424,39 @@ describe('Registration scenarios', function () {
     const registrationResponseBody = await registrationResponse.json() as any;
     expect(registrationResponse.status).to.equal(400);
     expect(registrationResponseBody.code).to.equal(DwnServerErrorCode.ProofOfWorkManagerInvalidChallengeNonce);
+
+    // 4. Alice fetches the new proof-of-work challenge.
+    const proofOfWorkChallengeGetResponse = await fetch(proofOfWorkEndpoint, {
+      method: 'GET',
+    });
+    const {
+      challengeNonce: newChallengeNonce,
+      maximumAllowedHashValue: newMaximumAllowedHashValue
+    } = await proofOfWorkChallengeGetResponse.json() as ProofOfWorkChallengeModel;
+    expect(proofOfWorkChallengeGetResponse.status).to.equal(200);
+
+    // 5. Alice computes the proof-of-work response nonce based on the the new proof-of-work challenge and the registration data.
+    const newResponseNonce = ProofOfWork.findQualifiedResponseNonce({
+      challengeNonce: newChallengeNonce,
+      maximumAllowedHashValue: newMaximumAllowedHashValue,
+      requestData: JSON.stringify(registrationData),
+    });
+
+    // 6. Alice sends the new registration request to the server and it is accepted.
+    const newRegistrationRequest: RegistrationRequest = {
+      registrationData,
+      proofOfWork: {
+        challengeNonce: newChallengeNonce,
+        responseNonce: newResponseNonce
+      },
+    };
+    
+    const newRegistrationResponse = await fetch(registrationEndpoint, {
+      method: 'POST',
+      headers: { 'Content-Type': 'application/json' },
+      body: JSON.stringify(newRegistrationRequest),
+    });
+    expect(newRegistrationResponse.status).to.equal(200);
   });
 
   it('should reject a DWN message for an existing tenant who agreed to an outdated terms-of-service.', async () => {