Proof of Stake (PoS)

Proof of Stake (PoS) is another consensus algorithm. It’s considered faster, more secure, and less resource intensive than PoW. Chains such as Polkadot, Avalanche, and Cardano use PoS, and Ethereum switched off PoW in 2022 to start using PoS instead. In PoS the role of the miner does not exist, eliminating the need for nodes to devote computing power to network transaction validation. Instead, PoS has stakers.

Staking

A staker is a node that participates in the validation and confirmation process. To become a staker, a node must lock up and put its coins (in the form of cryptocurrency) up as collateral (the amount is called stake) to prove that they are trustworthy and will take responsibility for the network’s security. The stake can be destroyed if the staker behaves dishonestly.

The PoS consensus is based on the random selection of a staker from the network who’ll be responsible for proposing the next block. The chosen staker is named the current block proposer.