What Is Proof of Stake? (PoS Explained Simply)

Definition

Proof of stake is a consensus mechanism where validators lock up, or stake, cryptocurrency to earn the right to validate transactions.

How it works

Validators are chosen to propose and confirm blocks, and they earn rewards for doing so honestly. Malicious behavior can result in their stake being slashed.

How it differs from proof of work

Proof of work uses computing power to secure the network, while proof of stake uses economic commitment. PoS is far more energy-efficient.

Staking rewards

Anyone can participate by delegating their coins to a validator and earning a share of the rewards.

Which networks use it

Ethereum, Solana, Cardano and many others now use proof of stake or a variant of it.

Bottom line

Proof of stake secures modern blockchains through staking rather than energy-intensive mining, making it faster and greener.