PROOF OF STAKE V. PROOF OF WORK
The fixed date announcement for the Merge event of Ethereum has created such a positive motivation towards the market. So, let’s review the difference between Proof of Stake and Proof of Work.
#pos #pow #comparison
PROOF OF STAKE V. PROOF OF WORK
The two share one thing in common - they are all consensus mechanisms in blockchain.
Which means they ensure users are honest with transactions, and reduces fraud such as double spending.
#pos #pow #comparison
PROOF OF STAKE V. PROOF OF WORK
The main difference between these two is how they verify the blockchain transactions.
With PoS, Validators are chosen based on a set of rules depending on the "stake" they have in the blockchain.
#pos #pow #comparison
PROOF OF STAKE V. PROOF OF WORK
The network randomly chooses validators to make sure the transaction is reliable.
Some examples: $ADA, $SOL, $ETH 2.0,..
#pos #pow #comparison
PROOF OF STAKE V. PROOF OF WORK
With PoW, Verifying cryptocurrency transactions is done through mining. It’s like a competition between miners to solve cryptographic puzzles and validate transactions in order to earn block rewards.
Some examples: $$BTC, $ETH, $ETC, …
#pos #pow
PROOF OF STAKE V. PROOF OF WORK
However, a coin always has two sides. They can not be perfect and better than each other.
The downside of PoS is the network requires an often enormous initial investment
-> To be qualified as a validator
#pos #pow #comparison
PROOF OF STAKE V. PROOF OF WORK
The the drawback of PoW are it requires a significant amount of energy to verify transactions
-> less environmentally friendly than other systems.
#pos #pow #comparison
PROOF OF STAKE V. PROOF OF WORK\
Moreover, this lead to centralization
-> small group of miners has controlled the blockchain
#pos #pow #comparison
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