Excuse my ignorance but I still can't wrap my head around this one

7 months ago

Memes.com

Can you help me understand what part of POS makes it crypto?

How can there be a blockchain without any kind of mining done by computers?

How is this different than the money equals influence system that is practiced around the world today?

HashFlare

Authors get paid when people like you upvote their post.
If you enjoyed what you read here, create your account today and start earning FREE STEEM!
Sort Order:  trending

I think the idea behind proof of stake is that the people with the most to gain/lose from the system will be the most motivated to keep it up and going and thus will participate in the consensus protocol (mining). Instead of basing the next block validator off of who can solve a computationally intense hash puzzle, the next person is picked based on the fraction of coins on the system they owned. Essentially this is an approach that attempts to solve issues associated with the proof of work protocol.

Also, this has nothing to do with the cryptography of the blockchain as the data structure is still the same.

If you are curious about consensus protocols, check out:

http://www.coindesk.com/short-guide-blockchain-consensus-protocols/

IMO very cool stuff. Also note that in the long term, Ethereum is transitioning from POW to POS:

https://www.ethnews.com/vitalik-buterin-on-governance-and-the-transition-to-proof-of-stake

·

most to gain/lose from the system will be the most motivated to keep it up and going and thus will participate in the consensus protocol (mining)

You may think the people that is most invested have the intention to profit most but profiting does not equal benefiting the network, that's not true in a world of unregulated money printing that can be transformed to the horror of the most influential people in this planet with this technology. What if they have invested with the intention of sabotaging because they support a competitor?

Instead of basing the next block validator off of who can solve a computationally intense hash puzzle

Isn't this what's keeping the network secure? That was always my understanding.

Say Ether for example, I have no intention of bashing it but how do I know all of it won't be dumped in a minute? At least Dash's version of POS requires you to lock up some tokens and run a node to benefit, what protects POS from manipulation if it's just a matter of paying Cash to buy into the organization?

·
·

Not totally sure about why POS works, that was just my basic understanding. I totally understand your concerns. Did you check out the link?

·
·
·

Yeah, I'm going through the second one one and still having trouble. I'm totally not a person to take sides, I just want to know how it works so I can at least explain it to others. Otherwise I couldn't confidently recommend this system.

Watching the anwers you will receive. Since Security is THE raison d'être of cryptocurrencies :)

·

I don't know why this subject is not discussed more