WHAT IS PROOF OF STAKE BLOCKCHAIN ALGORITHM?

in GEMS4 years ago


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Some of you may not know what PoS mean. So, I would try to keep simple for you guys. (PoS) is a consensus algorithm for the blockchain network to decide the creator of the next block for validating the transactions. You may have known that Bitcoin works on the Proof of Work(PoW) algorithm in which the more computational resources (example: mining rigs) you own, the more rewards you are likely to get (in bitcoin). To make the mining process much greener and efficient without the use of hardware for solving complex mathematical problems, the PoS algorithm was introduced. It basically works like this- the more you hold the coin the more likely that you will be the next block producers and earn rewards for that.

Peercoin was the first coin that uses this consensus blockchain algorithm. You can see other coins here.