Explanations on Energy-Efficient Consensus Mechanisms
Hello everyone, How are you doing, I welcome you again to my blog in the Steem Alliance community.
Today, we will discuss an interesting topic on the platform which will be Explanations on Energy-Efficient Consensus Mechanisms
- Introduction
The blockchain and cryptocurrency field has forever been discouraged by large audiences for its excessive energy consumption, especially with the usage of the Proof of Work (PoW) consensus process.
Therefore, as environmental concerns grow and this is what really factors in for the development of this, therefore, there has been a strong push to create and implement more energy-efficient consensus procedures for the blockchain eco-system sustainaces.
In this article, we will discuss and compare two systems, Proof of Stake (PoS) and Proof of Space (PoSp), with the major on their environmental impact and overall efficiency to this latest technology.
Understanding What a Consensus Mechanisms Is
Every blockchain network uses a consensus method to reach a validation agreement on the blockchain's current situation, therefore they ensure that all nodes in the network agree on the same node, therefore protecting the security and securing from outside attacks.
Proof of Work(PoW)
Bitcoin and some early blockchain ecosystems use proof of work (PoW), whereas other cryptocurrencies require miners to solve complicated mathematical challenges in order to validate transactions and generate new blocks.
Although, no doubt, it is the most secure consensus, at the same time PoW is extremely energy-intensive, necessitating massive processing power.
Proof of Stake (POS)
How POS Works
Proof of Stake (PoS) is a consensus mechanism that selects validators to build new blocks and validate transactions based on the number of tokens they own and are prepared to "stake" as collateral, which in exchange they earn some reward for the assets they are protecting as well.
The selection procedure is usually random but also determined by the number of staked tokens.
Environmental Impact of PoS
Lowered Energy Consumption: Unlike PoW, PoS does not require much processing power, validators are chosen based on their stake, not their ability to solve complex puzzles, dramatically reducing energy consumption.
Decentralization and Security: Proof of stake consensus helps increase network node participation by reducing the requirement for entry, hence it has better decentralization and security.
Examples of POS
Ethereum 2.0: With the introduction of the Ethereum 2.0 upgrade, Ethereum has shifted from PoW to PoS, with the major aim of reducing energy consumption and bringing in more scalability to the network.
Cardano: Cardano uses another PoS of its own known as Ouroboros, which is a proof-of-stake mechanism that is safe, scalable, and energy efficient.
Proof of Space (PoSP)
How PoSp Works
Proof of Space (PoSp), also known as Proof of Capacity, requires users to set a different disk space to solve cryptographic puzzles, therefore the more disk space a participant allocates, the better their chances of being chosen to validate transactions and produce new blocks for that particular chain, now let's look at the environment impacts of this.
Environmental Impact of PoSp
Energy Efficiency: Proof of Space consensus requires much less energy than PoW, as It uses unused disk space instead of computational power, and this sort of lowers the overall energy usage of the network.
Utilizing Existing Resources: Proof of Space can use existing storage space to make more profitable aspect for us by using the existing resources, hence it serves as environmental benefits.
Examples of PoSp
- Chia Network: Chia Network uses PoSp to secure its blockchain and positions itself as an environmentally friendly alternative to typical PoW-based coins.
Conclusion
This article sort of encompasses different types of environment-friendly consensus mechanisms that are suitable for validators, PoW seems like a very suitable mechanism as it has more security than others, but over the years every organization mining this struggles to keep up due to its energy consumption mechanism, at the same time, it is not environmentally friendly.
Without saying much, PoS came in as an alternative to this, but commoners/retailers like me do find it hard to join in regardless of our interest just because of the staking requirement, PoSp seems like something doable if you have the space and the little resources it requires, in the coming slide, we will dive deeper into Proof Of Space and do a comparative analysis between Proof of Space and Proof of Stake.
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Thanks for the review ser