In a simple terms, the difference between POW & POS is the mining cumputing power.
POW uses a higher computing power than POS, and it also consumes more electrical power than POS.
To mine coins with POW you need to mining equipments, where as, to mine with POS all you need is a unit of some coin in your wallet, and have your wallet running for a period of time, as the wallet is running it automatically generate new coins for you.
Topic: What is the difference between PoW and PoS ? (Read 188 times)
Proof of Work
Advantages of PoW:
- Impact of external factors. With the PoW mechanism, the production and circulation of money requires external factors such as energy and hardware. You can not recover the energy or output of the hardware. Why is this important to be explained in the Proof of Stake section below.
- Quite simply for minning. You only need to get the hash functions that other computers have computed, combine them into a large hash function, from which many computers havehes together and divides the profits.
- PoW is very useful for areas with surplus electricity, such as China with hydroelectric dams.
Disadvantages of PoW:
- PoW can not be used on small and weak devices such as smartphones. These devices not only lack the space to store hundreds of gigabytes of blockchain data but they also do not have enough computing power to dig effectively. Phone battery will run out very fast but not really accomplish anything.
- PoW is very slow. With Bitcoin every 10 minutes a block, and only transactions in that block are processed. Everything else must wait for the next block. The consequences are long waiting times or expensive transaction fees (higher transaction costs are processed faster).
- PoW is consuming a huge amount of electricity. Only one single block has consumed more electricity than the needs of some countries for a whole year. This will only get worse. The dependence of pre-coding on electricity is unsustainable in most stable environments. This dependency also means that higher electricity bills or government-imposed limits on types of electricity can "kill" an entire digital currency.
- PoW allows centralized digging. China accounts for 80% of the world's Bitcoin hash capacity, and if they coordinate cartels (voluntary organizations affiliated in a consensual manner to dominate economic power) into the common resource We have seen 80% attack, not 51% attack (blockchain attack by digger group controls more than 50% of network exploit power).
- Because the block bonus continues to decrease, miners get less tokens from a blocked blockchain. At the same time, the more people involved in digging, the more difficult it will be, so it will be harder to dig. This makes digging more expensive than making people leave the system. The crypto itself destroys itself. The low shear capacity of the digging community also increased the likelihood of 51% attack.
Proof of Stake
Advantages of PoS:
- Handle transactions quickly.
- In contrast to PoW, PoS does not harm the environment.
- Not easy to be attacked by government: no need for huge amounts of electricity.
- Can be implemented on smaller and weaker devices because there is no need to download the entire blockchain, and because it does not require a lot of computing power, it can easily be accepted massively.
Disadvantages of PoS:
- No external factors. Because shares are part of the system itself, the whole game is internal. That means someone with enough money to invest exclusively to destroy the system can do so by investing only in money; In contrast to Bitcoin, where they need to invest money, time, expertise, hardware, power and more - all external factors.
- The rich are richer. Those who have the longest ether (the age of an Ether in an account also plays the role of a quantum number) also have the greatest chance of becoming a validator. That means that the opportunity to earn more aether on their current wealth is also increased. It is different from Bitcoin's "richer and richer" system because rich people must continue to invest in hardware and knowledge to stay competitive. They also suffer more if they damage the network.
Advantages of PoW:
- Impact of external factors. With the PoW mechanism, the production and circulation of money requires external factors such as energy and hardware. You can not recover the energy or output of the hardware. Why is this important to be explained in the Proof of Stake section below.
- Quite simply for minning. You only need to get the hash functions that other computers have computed, combine them into a large hash function, from which many computers havehes together and divides the profits.
- PoW is very useful for areas with surplus electricity, such as China with hydroelectric dams.
Disadvantages of PoW:
- PoW can not be used on small and weak devices such as smartphones. These devices not only lack the space to store hundreds of gigabytes of blockchain data but they also do not have enough computing power to dig effectively. Phone battery will run out very fast but not really accomplish anything.
- PoW is very slow. With Bitcoin every 10 minutes a block, and only transactions in that block are processed. Everything else must wait for the next block. The consequences are long waiting times or expensive transaction fees (higher transaction costs are processed faster).
- PoW is consuming a huge amount of electricity. Only one single block has consumed more electricity than the needs of some countries for a whole year. This will only get worse. The dependence of pre-coding on electricity is unsustainable in most stable environments. This dependency also means that higher electricity bills or government-imposed limits on types of electricity can "kill" an entire digital currency.
- PoW allows centralized digging. China accounts for 80% of the world's Bitcoin hash capacity, and if they coordinate cartels (voluntary organizations affiliated in a consensual manner to dominate economic power) into the common resource We have seen 80% attack, not 51% attack (blockchain attack by digger group controls more than 50% of network exploit power).
- Because the block bonus continues to decrease, miners get less tokens from a blocked blockchain. At the same time, the more people involved in digging, the more difficult it will be, so it will be harder to dig. This makes digging more expensive than making people leave the system. The crypto itself destroys itself. The low shear capacity of the digging community also increased the likelihood of 51% attack.
Proof of Stake
Advantages of PoS:
- Handle transactions quickly.
- In contrast to PoW, PoS does not harm the environment.
- Not easy to be attacked by government: no need for huge amounts of electricity.
- Can be implemented on smaller and weaker devices because there is no need to download the entire blockchain, and because it does not require a lot of computing power, it can easily be accepted massively.
Disadvantages of PoS:
- No external factors. Because shares are part of the system itself, the whole game is internal. That means someone with enough money to invest exclusively to destroy the system can do so by investing only in money; In contrast to Bitcoin, where they need to invest money, time, expertise, hardware, power and more - all external factors.
- The rich are richer. Those who have the longest ether (the age of an Ether in an account also plays the role of a quantum number) also have the greatest chance of becoming a validator. That means that the opportunity to earn more aether on their current wealth is also increased. It is different from Bitcoin's "richer and richer" system because rich people must continue to invest in hardware and knowledge to stay competitive. They also suffer more if they damage the network.
I guess this is better displayed @ Service Discussion.
Literally Proof of Work is translated as "proof of work" or proof of the work done. If we interpret this transfer to the crypto-currency sphere, then the computing operations of the equipment are accepted here. Proof of Work is such a mechanism for verifying that the work (calculation of the same mining) has been carried out.
Proof of Stake. Literally this term can be translated as a proof of a share of possession. If the crypto currency uses this consensus algorithm, then transaction validation occurs through the network nodes. Roughly speaking, the more a person's crypto currency is on his wallet, the more chances he has to find a new unit and confirm the authenticity of the transaction, getting a reward for it.
Proof of Stake. Literally this term can be translated as a proof of a share of possession. If the crypto currency uses this consensus algorithm, then transaction validation occurs through the network nodes. Roughly speaking, the more a person's crypto currency is on his wallet, the more chances he has to find a new unit and confirm the authenticity of the transaction, getting a reward for it.
Nice summary. Just A small correction.
The equation in pow is just an attempt to find a hash that is a number smaller than x. When someone finds a hash that solves the equation a new block is created and that miner is rewarded
There are no miners in pos, they are called validators.
The equation in pow is just an attempt to find a hash that is a number smaller than x. When someone finds a hash that solves the equation a new block is created and that miner is rewarded
There are no miners in pos, they are called validators.
PoW (Proof of Work) also known as work proof algorithm. This algorithm helps miners solve mathematical equations in Bitcoin digging. There are many ways to solve math equations, but the system chooses only the best answer. The Blockchain system can not be fooled because it contains a list of the most appropriate answers.
PoS ( Proof of Stake) or stock evidence algorithm occurs when a miner contributes to a particular currency to verify the transaction. The proof of stake algorithm is quite simple for computers because you only need to prove that you own a share of that currency. For example, if you own 5% of the existing Ethereum copper flow, you have the right to exploit all 5% of the Ethereum transaction.
Proof of stake is considered a fairer system than proof-of-work when everyone can become a miner. No matter large or small, the scale of exploitation will be linearly proportional to the number of shares held. This encourages the community to engage in transactional verification, increasing decentralization and democracy.
PoS ( Proof of Stake) or stock evidence algorithm occurs when a miner contributes to a particular currency to verify the transaction. The proof of stake algorithm is quite simple for computers because you only need to prove that you own a share of that currency. For example, if you own 5% of the existing Ethereum copper flow, you have the right to exploit all 5% of the Ethereum transaction.
Proof of stake is considered a fairer system than proof-of-work when everyone can become a miner. No matter large or small, the scale of exploitation will be linearly proportional to the number of shares held. This encourages the community to engage in transactional verification, increasing decentralization and democracy.
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