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Proof of Stake changes things to the point where mining is no longer really a good descriptor of what is going on behind the scenes. Proof of Stake starts out
by centizen 5y ago
Proof of Stake changes things to the point where mining is no longer really a good descriptor of what is going on behind the scenes.
Proof of Stake starts out with a large amount of coins being generated out of thin air. These are then distributed, and owners add nodes to the network by locking in a portion of their coins as their "stake".
The nodes perform transaction verification, and over time a reward block is built out of the transaction fees involved. This is awarded to a psuedorandomly selected node weighted by stake.
- delecti 5y agoSo the people who already have the most of a coin are the most likely to earn even more by just sitting on it?
- wiredfool 5y agoBy the rich, for the rich.
- woah 5y agoIn proof of work, the rich also get richer, but they just spew tons of co2 while doing so. Anyway, what doesn’t work this way? Have you ever heard of stocks, or interest on a loan or bank account?
- TacticalCoder 5y agoWell yes and no: those staking coins do indeed get more coins but there's still lots of speculation going on. I mean: it's not a given that if, today, with x coins you can buy, say, a laptop tomorrow with x * 2 coins you'll still be able to buy that same laptop. Stakers do definitely take the volatility risk. They're rewarded by getting more coins.