Proof-of-stake

Proof of stake has been contrasted to proof of work as virtual mining, simplified with the phrase "One coin, one vote" as compared to proof of work's "one cpu, one vote". Users are required to 'stake' their cryptocurrency to become a network validator.

PoS also supports decentralization because PoS is more likely to produce more nodes on the network compared to PoW consensus mechanisms due to lower barriers of entry. There are no hardware requirements necessary to become a validator on a PoS blockchain network, making individual validators more likely to be chosen to create new blocks without the need for investing in expensive mining equipment and energy required by PoW consensus.

An advantage of proof of stake systems is the reduction in computational power required to maintain the system compared to proof of work.

Proof-of-Stake (PoS) eliminates the use of high-powered computing from the consensus mechanism for securing blockchain networks used by proof-of-work (PoW). This make PoS more energy efficient and environmentally friendly when compared to PoW consensus mechanisms being used by cryptocurrencies such as Bitcoin and Dogecoin.

PoS incentivizes security through rewards and punishments for behaviours that make the PoS network more or less secure. Some critics view PoS staking as creating more security or less security for PoS networks. If stakers attempt to attack PoS networks they may have their stake in the network taken away from them for acting maliciously towards the network.

The security and scalability properties of proof of stake mechanisms as compared to proof of work mechanisms continue to be debated in the blockchain community. PoW uses an external form on collateral in the form of computational and energy resources to secure the network which incentivizes miners to not act maliciously towards the network because mining is resource intensive.