Proof of Stake

Nevertheless, PoW is not cost-efficient due to the amount of computation power required and, consequently, the expenses on the energy needed. But there is an alternative approach which is called Proof of Stake. In this case, the probability to get a reward for maintaining the blockchain is proportional to the participant’s stake. To be rewarded, a maliciously acting participant needs to possess over 50% of the total stake. Only in this case, he will be able to promote his interests. It’s quite an unlikely scenario which means that PoS approach ensures a high level of security for the blockchain. In the framework of this approach, the members vote for the updates on the blockchain with the next block based on their current stake, i.e. “Proof-of-stake is essentially one-stake-unite-one-vote.”