Crypto Academy Season 3 Beginners' course - Homework Post for Task 4: [Difference Between PoS & DPoS] by @offia66 for professor @sapwood
Greetings crypto lovers.
(1) What is the difference between PoW & PoS? Advantages & Disadvantages? Which one is better in scaling Capacity? Examples?
POW: It can be seen as a system that demands achievable amount of work so as to stop the inappropriate uses of technology (computers) which includes phishing emails. Proof of work (POW), It was initiated to secure digital currency.
POS: just as we have the Steem power (SP) on the platform which promotes the saying of the more Steem power the more influential you are. The POS goes by the more coins you posses the more mining power you would have.
What is the difference between PoW & PoS?
PoW and PoS are distinct consensus mechanisms
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| POW | POS |
|---|---|
| 1. Requires high amount of energy. | 1.It is centralized, there is an existence of a central authority. |
| 2. Existence of unconfirmed pool where transactions go to before it is confirmed. | 2. The more coin in a miners possession the more a miners mining power. |
| 3. It is Decentralized that is there is no central authority. | 3. Since it is centralized it attracts more stake holders. |
| 4. Miners transactions are record on a ledger. | 4. Miners earn or mine based on the number of coins they have. |
| 5. If energy supply is limited it results to a limited scaling capacity. | 5. Small amount of energy consumed. |
| 6. Validators are selected at random. | 6. Validators are selected based on how high your stake. |
| 7. Encourages the sale of coins. | 7. Encourages accumulation or holding coins so as to increase or boost mining power. |
Advantages & Disadvantages of POw and POS.
Advantages of POW.
- Invalid transactions are not processed.
- Miners are allowed to verify transactions.
- it is Decentralized.
- Encourages the sale of coins.
- validation is random
Disadvantages of POW.
- high energy Consumption.
- high risk: since it is accessible by anybody.
Advantages of POS.
- It is centralized.
- Stake holders are attracted.
- low energy Consumption.
- Security.
Disadvantages of POS.
- users are are Forced to follow stipulated rules since it is centralized.
- Those with more coins will oppress those with small amount of coins.
- Encourages the accumulation of coins.
- Validation is based in Stake.
Which one is better in scaling Capacity? Examples?
The POS has a better and efficient scaling capacity compred to POW because limited or inefficient supply of power results to a limited scaling capacity on the POW.
Examples of coins operating under POw..
- Bitcoin
- Ethereum.
Examples of coins operating under POs.. - EOS
- Ada cardano.
In conclusion proof-Of-work rewards it users for providing solutions to rigid equations while in proof-of-stake the miner who creates the chain that follows is the one with the most mining power ratio due to the percentage of the coin in there possession.
A big thank you to professor @sapwood for such a mind blowing lecture .
