Proof-of-Stake Explained

What is Proof-of-stake?

With proof of stake, nodes can verify transactions and create blocks by putting their encrypted coins into the share wallet. These cryptocurrencies must be kept in the wallet and cannot be traded. With the normal version of the proof of stake, people with few cryptocurrencies will not be able to stake. The more cryptocurrencies you have, the greater the chance that the network will select you as a node, for example if you have 500 coins you will have x10 greater chances of being picked as a node instead of someone who has got 50 coins. 

Proof-of-stake has been designed to function as an alternative to proof-of-work and to counter and solve the issues it had. One of the main advantages it brings is that PoS does not require an enormous amount of energy to keep computers running. Next to this fact it also has a better resistance against hackers. 

One of PoS’ disadvantages is that it contradicts where cryptocurrency stands for, because ultimately, the rich get richer & the poor get poorer (Matthew-effect). This is because those who are wealthier will be prioritized to participate as a node. 

How to create NFTs?


Share on facebook
Share on twitter
Share on linkedin
Share on whatsapp
Share on telegram
What are gas fees

Gas Fees Explained

What are gas fees? To make a comparison, if the Ethereum blockchain was a car engine, GAS would be its fuel. The blockchain requires GAS to