Proof of Stake (PoS)

What is Proof of Stake (PoS)?

Proof-of-Stake is designed to both validate and provide consensus for a transaction. In contrast, in Proof-of-Stake, the new block producer is elected based on the amount of network coin staked. This was one of several consensus mechanisms designed as an alternative to proof of work. There are key characteristics:

• PoS will reward the validators for their commitment of stake.

• An algorithm identifies the validator with the highest stake in the coin. You can imagine it is working in the reverse of PoW (in which a miner solves a transaction).

• The value of staking will enhance security for a transaction as the high cost to hold large amounts of a cryptocurrency, to prevent hackers because they are less likely to invest large amounts to stake them for a long period of time.

• PoS requires less energy compared to PoW.