• Dapps:16.23K
  • Blockchains:78
  • Active users:66.47M
  • 30d volume:$303.26B
  • 30d transactions:$879.24M
How Proof-of-Stake (POS) blockchains work

How Proof-of-Stake (POS) blockchains work

user avatar

by Alexandra Smirnova

2 years ago


Proof-of-Stake (PoS) is a consensus mechanism used in blockchain networks to validate transactions and create new blocks in the chain. In contrast to the Proof-of-Work (PoW) mechanism, which requires miners to solve complex mathematical puzzles to validate transactions and create new blocks, PoS relies on participants staking their cryptocurrency as collateral to validate transactions and create new blocks.

In a PoS system, the participants (often called validators or stakers) are selected to validate transactions and create new blocks based on the amount of cryptocurrency they have staked. The higher the stake, the more likely a participant is to be selected as a validator. Once a validator is selected, they can create a block by adding transactions to the chain and broadcasting it to the network. Other validators then verify the block and add it to their copy of the chain.

Validators are incentivized to act honestly and maintain the security of the network, as they stand to lose their stake if they are found to have acted maliciously. In addition, some PoS systems incorporate mechanisms to punish validators who act against the network's interests, such as slashing a portion of their stake.

PoS has several advantages over PoW. It is less energy-intensive, as it does not require participants to solve complex mathematical puzzles. It also allows for a more decentralized network, as validators do not need expensive hardware to participate. However, PoS systems may be more vulnerable to certain attacks, such as a "nothing-at-stake" attack, where validators have little to lose by participating in multiple forks of the chain. To mitigate this risk, some PoS systems use mechanisms such as finality, where blocks are considered irreversible after a certain number of confirmations.

Proof-of-stake (PoS) has several advantages over proof-of-work (PoW) consensus mechanisms. PoS is more energy-efficient than PoW because it does not require miners to solve complex mathematical equations, which consume a lot of energy. This makes PoS more cost-effective and scalable than PoW. Additionally, PoS incentivizes validators to act honestly because they stand to lose their stake if they validate fraudulent transactions. This makes the network more secure and less susceptible to attacks. Finally, cryptocurrencies that use PoS benefit both the network and their investors.

0

Share

Other articles

BugsCoin (BGSC): A New Era in Decentralized Financial Learning​

BugsCoin (BGSC) merges Web3 technology with financial education, offering a gamified platform that rewards users for learning and participating in simulated trading environments.

user avatarElena Ryabokon

3 hours ago

WINKO Game Token: A full review of the game on the TON-blockchain

Cryptocurrency games are becoming more and more popular, offering not only entertainment, but also the opportunity to earn money. WINKO Game Token is a Telegram clicker game that uses the TON blockchain for transactions.

user avatarMax Nevskyi

8 hours ago

SEED App — Mine SEED: A Unique Way to Earn Cryptocurrency via Telegram

SEED App is a Telegram bot that allows users to earn SEED cryptocurrency by completing simple in-game tasks. Learn how to start mining, the advantages and disadvantages of the project, and how to use the referral program to increase your income.

user avatarAlexandra Smirnova

a day ago

MixMob: Racer 1 is a unique combination of racing action and card strategy

MixMob: Racer 1 is a unique game combining racing action and card strategy. In a world where robots rule humanity, players create and train MixBots robots by fighting on arena tracks.

user avatarMax Nevskyi

a day ago

Long Nardy: A Backgammon Game with Cryptocurrency and Blockchain Elements

Long Nardy is a digital version of the classic backgammon game with cryptocurrency and blockchain elements. The game offers unique opportunities for earning and trading assets in the virtual world.

user avatarMax Nevskyi

a day ago

Sats Terminal: Tools for Efficient Interaction with DeFi on Bitcoin

Sats Terminal is a DeFi protocol aggregator for Bitcoin, providing users with access to exchanges, staking, liquidity, and cross-chain bridges, enhancing interaction with decentralized finance.

user avatarEve Adams

a day ago

dapp expert logo
© 2020-2025. DappExpert. All rights reserved.
© 2020-2025. DappExpert. All rights reserved.

Important disclaimer: The information presented on the Dapp.Expert portal is intended solely for informational purposes and does not constitute an investment recommendation or a guide to action in the field of cryptocurrencies. The Dapp.Expert team is not responsible for any potential losses or missed profits associated with the use of materials published on the site. Before making investment decisions in cryptocurrencies, we recommend consulting a qualified financial advisor.