Proof of Stake | What It Is & How It Works

What you should know about proof of stake (PoS)

Do you know what proof of work is? It’s crucial to have some knowledge of what it is so that you can better understand what the proof of stake is. If you don’t know what Proof of Work Is you can read our article ‘Proof of Work | What It Is & How It Works’. Now let’s dive in.

In the proof of work consensus model, a group of miners will spend so much time, energy, and computing power to solve the complex puzzle before adding a transaction to the blockchain. From the hundreds of miners, only one can get the solution right and is rewarded for their work. What happens to the others? Did they just waste their resources for nothing? Sadly, yes.

There’s also the possibility that the miners might gang up and start making fake transactions. If they manage to pull more than 51% of miners to validate transactions, all your bitcoins are good as gone.

Proof of stake was introduced to tie such loose ends in proof of work. Proof of stake is a more energy-efficient and low-risk alternative to proof of…