Proof of Stake and why it is preferred!
The Proof of Stake is a consensus algorithm that was first introduced in the Bitcoin talk forum in 2011, as a method of solving the problems presented by the proof of work method. The goal for both these methods is the same; to reach consensus in the blockchain.
The only thing that differs when you compare them is that each has a different way to reach the set goals of consensus.
The most important things to keep in mind when we talk about proof of stake include;
- You can mine and validate block transactions based on the number of coins you hold
- The proof of stake concept is an alternative to proof of work. Blockchain technology originally used the Proof of work algorithm to confirm transactions while adding new blocks to the blockchain.
- Proof of work requires a lot of energy where sometimes the Miners will have to sell their coins to foot the bill. Proof of stake gives you power based on the number of coins you have
- Proof of stake is less risky in terms of the potential of the miners to attack the network. It structures compensation in a way that makes an attack less helpful for miners.
