Why Proof of Stake is the Future of Blockchain Technology?

2019-8-3 12:43

Coinspeaker
Why Proof of Stake is the Future of Blockchain Technology?

Being a crypto investor, you must be well-aware that Bitcoin, along with most other cryptocurrencies, uses Proof of Work (PoW) mechanism for the verification of transactions on its network.

This most commonly used blockchain verification method is the reason behind the various problems of Bitcoin and other currencies that use it. For one, it creates a sustainability problem because of high energy consumption during the verification process. PoW is one of the main reasons why Bitcoin mining consumes nearly 41 terawatt-hours of energy, which is equivalent to the annual power consumption of New Zealand.

In such cases, Proof-of-Stake (PoS) is quickly replacing as an environment-friendly alternative to PoW. It not only limits the amount of computing power used for mining a block but also effectively resolves the security problems presented by PoW mechanism.

What is Proof of Stake?

Proof of Stake or generally called PoS is a blockchain consensus mechanism where block miners are selected by an algorithm based on the stakes of users. Unlike PoW, PoS doesn’t involve any competition to solve one or more complex puzzles in order to mine new blocks. Here, the users with the most stakes are selected by the algorithm on a random basis.

A PoS consensus uses a computer algorithm to select the users for mining based on the number of tokens (stakes) held in the network. For instance, a user with a 50% stake in the network will be able to mine new blocks (validate transactions) in proportion to his/her stake. In theory, they can mine up to 50% of the new blocks.

The selection of stakeholders/validators to validate a new block of transactions is done through a voting round where the decision depends on the number of tokens held by different participants.

Benefits of PoS or Why Proof of Stake Is Important

One of the primary benefits of the PoS mechanism is that the users do not have to compete with each other, as there are no puzzles or problems to solve. This means the energy consumption is substantially lower as compared to PoW consensus.

Proof of stake is comparatively more secure as the miners are motivated to protect the ledger in order to protect their own interests. Also, there are serious penalties for those who try to harm or penetrate the system in any way.

Many modern generation blockchains like OKCash, Titanprojects (Titan Coin), NavCoin are using Proof-Of-Stake consensus for protecting the interest of miners and making transactions more secure and energy-efficient. The use of the PoS system also increases the overall profitability of blockchain miners while reducing the cost.

So, Is PoS Better than PoW?

While nothing can be said for sure, after analyzing the available stats and performance of the projects using PoS, it can be said that this network types definitely sound more appealing and promising. Proof-of-Stake is certainly less operationally expensive than its counterpart, and at the same time, resolves the cost and ecological issues of traditional mining.

Once the modern generation blockchain systems like ReddCoin, Neblio which utilize PoS, are launched, they will certainly help increase security and boost the energy efficiency of the mining systems. It will also aid to the speed of validation of blockchain transaction which might present a wide array of applications in a range of industries.

Why Proof of Stake is the Future of Blockchain Technology?

Similar to Notcoin - Blum - Airdrops In 2024

origin »

High Performance Blockchain (HPB) на Currencies.ru

$ 0 (+0.00%)
Объем 24H $0
Изменеия 24h: 0.00 %, 7d: 0.00 %
Cегодня L: $0 - H: $0.0064459
Капитализация $0 Rank 99999
Цена в час новости $ 0.4042 (-100%)

blockchain technology future proof stake features out

blockchain technology → Результатов: 126


Фото:

5 Innovative Blockchain Projects Transforming Social Impact and Community Engagement

Blockchain technology has long been associated with finance and supply chain management, but its potential extends beyond these fields. Outside cryptocurrencies like Bitcoin, blockchain technology’s transparency and security are now used to address social and environmental issues while promoting accountability and community involvement.

2024-6-11 19:30


DDO Chain: Building Scalable Enterprise Blockchain Solutions

In today’s digital era, blockchain technology has become a focal point across various industries. As businesses urgently seek digital transformation and continuously strive for data security and transparency, blockchain technology emerges as a decentralized, secure, and trustworthy database technology, increasingly applied in enterprise-level solutions.

2024-5-1 15:00


Bedbugs on Blockchain: South Korea Experiments With DLT to Fight Pest Infestation

In a fusion of technology and public health, blockchain engineer Kang Jae-gu has launched a data-centric initiative to combat South Korea's escalating bedbug infestation. This novel application of blockchain technology is a testament to its expanding global influence and potential to provide solutions in diverse sectors beyond finance.

2023-12-19 10:00


Фото:

Goldman Sachs Thinks Blockchain Is The Greatest Thing Since The Internet And Holds The Key To The Future Of The Metaverse

Goldman Sachs has praised the features of blockchain technology and called it the future. The investment back says that the metaverse will thrive on blockchain as we move to a decentralized future. More institutions are embracing the power of blockchain technology with central banks using the technology to build their CBDCs. Blockchains were given the […]

2021-12-19 18:27


Taking IoT into the Future: Cartesi Joins Forces with IoTeX

With an upcoming Ideathon for Dutch Blockchain Week, the collaboration will provide innovative IoT services with all the safety and security benefits of blockchain technology This year has seen the near infinite applications of blockchain technology continue to positively impact the world and the thousands of businesses within it, with growth in the industry not […]

2021-12-2 17:00


Taking IoT into the Future: Cartesi Joins Forces with IoTeX

With an upcoming Ideathon for Dutch Blockchain Week, the collaboration will provide innovative IoT services with all the safety and security benefits of blockchain technology This year has seen the near infinite applications of blockchain technology continue to positively impact the world and the thousands of businesses within it, with growth in the industry not set to pause anytime soon.

2021-12-2 17:00


Blockchain as a Service Protocol Stratis Attracts Investment From Alphabit Digital Currency Fund

Blockchain technology has taken on various forms since the introduction of Bitcoin and continues to evolve even today to meet the industry’s ever-changing demands and needs. Businesses and companies could benefit enormously from blockchain, but integrating distributed ledger technology is often expensive and time-consuming.

2021-2-2 12:00