Steemit Crypto Academy Contest Season 1 Week 3 - Blockchain through the concepts - By @mbemba2310

Hey guys,

I welcome you'll to the third week of the SteemitCryptoAcademy engagement challenge. Without wasting time, let's proceed with the given task.

(1)

Tell us about your favorite concept or term related to blockchain, try to be explanatory and make sure to give your opinion

• PROOF-OF-STAKE

---

_{Proof-of-Stake}

---

Proof-of-Stake is a type of consensus mechanism which allows users who stake their coins to operate as validator nodes on a given blockchain.

These nodes are in charge of transaction verifications and they are mostly selected randomly by the blockchain protocol although sometimes the chances of being selected increase with an increase in stake.

After each block of the transaction is successfully verified and added to the blockchain, the node operator earns a reward in the native token of the blockchain.

Most node operators do come together in other to increase their stake which will in turn give them higher chances of being selected often to verify transactions and reward earned is properly shared amongst them.

(2)

Why do you think it is important in the blockchain?

The Proof-of-Stake consensus is quite important to the blockchain and this is due to various reasons which include;

• Scalability

The Proof-of-Stake is very much scalable, unlike the proof-of-work which has higher security but low scalability. The Proof-of-Stake protocol allows the verification of multiple transactions at the same time thus making it efficient in transaction rate.

---

• Decentralization

The Proof-of-Stake also portrays a good example of decentralization as it gives users who stake their coins the right to governance. This allows them the ability to evenly make a decision on the platform and the decision usually go in favor of the majority thus making it a perfect example of democracy.

---

• Low cost of transaction

The Proof-of-Stake operates on very low transaction cost which is one of the reasons it's being widely adopted. This can also explain why Ethereum is currently working on abandoning the proof-of-work consensus into adopting the Proof-of-Stake.

---

• Low energy consumption

We are very much aware of how miners perform their mining activities on the proof-of-work consensus. They do this using sophisticated machines which consume high energy and electricity and have also been tagged to be detrimental to the environment. But due to the nature of transaction verification of the Proof-of-Stake, it has made it efficient to verify transactions at very low energy.

(3)

Do you think that the existence of the blockchain would be possible without this concept? Is there an alternative or similar term?

Of course, the existence of blockchain will be totally possible without the Proof-of-Stake. After all the blockchain has been existing before the Proof-of-Stake was introduced due to the shortcomings of the proof-of-work.

Other consensus mechanisms that can effectively take the position of the Proof-of-Stake include;

---

Proof-of-work, Proof-of-Authority, Delegated Proof-of-Stake, Proof-Of-Burn, Proof-of-brain, Proof-of-importance, Proof-of-Activity, etc.

---

The proof-of-work which has already been stated to be the first consensus mechanism ever used on blockchain verifies transactions through the mining activities of users.

These users perform complex calculations using sophisticated computers and when each block is fully verified, it is added to a digital ledger known as blockchains. Users who perform this activity are regarded as miners.

(4)

Do you think it is possible to improve this term in some way? Explain to us how

Just like every other consensus mechanism, the Proof-of-Stake consensus has its own shortcomings such as its low level of security when compared to the proof-of-work.

The fact that there's an increase in user influence with an increase in stake is also a problem as it normally leads to an uneven influence on the platform thus making users with high stakes enjoy much larger benefits than others.

Rewards earned from staking assets are also too minimal, especially for low capital investors, and thus discourage them from staking. This thereby makes the platform to be mostly run by the rich guys.

---

• A way to improve the Proof-of-Stake

In as much as no consensus mechanism can be made perfect, the Proof-of-Stake can further be improved by increasing the incentives earned on stakes. This will allow more users to engage in staking not minding if they earn any further benefits or not.

Also, the influence should be evenly distributed as the gap between those with large stakes and the low ones are tremendously wide thus making those with low stakes almost irrelevant. If there should be a way to at least close up this gap, I believe that the Proof-of-Stake will make a lot of sense.

CONCLUSION

Blockchains wouldn't exist independent of the consensus mechanism which allows transactions to be verified without the involvement of a third party.

In as much as the blockchain can't exist independent of a consensus mechanism, it will exist independent of the Proof-of-Stake and this is because other consensus mechanisms can be used in place of it.

Thank you, and God Bless you!