Crypto Academy Season 4 Beginners' course - Task 6: Different types of Consensus Mechanisms by @tripplem
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(1) What is the difference between PoW & PoS? Advantages & Disadvantages? Which one is better in scaling Capacity? Examples?
DIFFERENCE BETWEEN PoW and PoS
PROOF OF WORK (PoW)
Proof of Work(PoW) is a protocol that is used to confirm transaction/s and create new blocks in a blockchain. It is a consensus algorithm in blockchain network that strengthens the security system network from any sort of the hacking and cyber attack.
Nodes/Minors on the networks try to solve complex mathematical problems associated with a transaction in order to verify the transaction that is perform on the network (mining process) . When the puzzle is solved, the transaction is stored on the network while the minor that solved the puzzle is rewarded.
In summary , PoW Restricts miners from mining and validating block transaction, it requires lots of energy and has a high risk.
While
PROOF-OF-STAKE (PoS)
Proof of stake is also a protocol that has a different mining process with PoW. Unlike PoW, only those nodes who have stake their assets on the network can participate in the mining process.
The selection process is based on the quantity of coins owned/staked by the minors through PoS and the more coins, the more mining power you will have.
In summary, PoW permits miners to mine and/or validate block transaction in according to the amount of coin a miner uses/has/staked, it doesn’t require lots of energy and has lesser risk than PoW
ADVANTAGES AND DISADVANTAGES
PoW
There are lots of advantages and disadvantages, but I will state a few.
Advantages
Rewards Minor that solves the problem first
strengthens the network security
provides solid mechanism for consensus achievement which is also used to prevent misuse and abuse
Disadvantages
it has a slow block generation time (10 minutes)
mining process is a bit costly
requires high power and heavy machines for mining process…. In a more simple English , it is expensive .
PoS
There are lots of advantages and disadvantages, but I will state a few.
Advantages
very high transaction speed
rewards miners for mining the transaction
it is cost effective
Disadvantages
miners cannot sell and stake coins same time
liquidity is limited
less security than PoW
WHICH IS BETTER IN SCALING CAPACITY AND EXAMPLES
Proof of stake (PoS) is better in scaling Capacity. PoS is more flexible and is faster in Transaction completion , flexibility, speed and cost effectiveness than the PoW.
Examples of Cryptocurrencies that uses Proof of Stake are ;
•ETH 2.0
•BNB
•RAYDIUM
•TEZOS
•AKASH NETWORK
•DASH
•NEO
•NOW
(Etc)
CONCLUSION
I want to thank Professor @sapwood for this lecture, I have learnt a lot , if not for anything I learnt that POB is not only for proof of brain, it can also mean proof of burn. It was an honor to be lectured by you.
Thanks.
