Proof of Work VS Proof of Stake. What’s it about?

If you are interested in cryptocurrency, you might have come across the two concepts – Proof of Work and Proof of Stake. The debate surrounding these two is gradually gaining ground. So, which one is better? How can you infer? To understand this, you need to understand the meaning of each one. Let’s proceed with it. 

What is Proof of Work? (PoW)

Blockchain Technology does not have a central entity that controls it. This absence is one of the features for which it is famous. But have you ever wondered how then, is the process secure? 

While building the first cryptocurrency, the creator, Satoshi Nakamoto, invented a way to verify all the transactions that would take place. The challenge was to have control over everything that was taking place to maintain security and safety. But, it was also necessary to have no central power. This challenge made them design Proof of Work. 

Under this system, to maintain transparency, every network member has to solve a complicated mathematical problem. This activity would prove that nobody is trying to mess with the system. It is a mechanism to build consensus among the many users and make sure that everybody involved is capable of and invested in the process with decent intentions. The Proof of Work is a brilliant plan to deduct the need for a central power to ensure the legitimacy of the transactions and deals. However, the method is labour intensive.

Additionally, it also requires a considerable quantity of electricity and internet. The Proof of Work exercise also helps keep the bad actors away who can cause confusion, theft and breach of data. It is essential to be aware of these factors when starting  Bitcoin

What is Proof of Stake? (PoS)

The Proof of Stake is an entirely different apparatus, analyzed and in a way, it gives power to the more coin holders to maximize their profit and gain more coins. This system is more complicated than the previous one. 

PoS, like PoW, is also a tool or method to legitimize coins and approve of their identity. However, in this case, the miners who own more coins in a particular blockchain verify the transactions. This feature means that the user who owns the majority of the coins in one blockchain has the right to confirm transactions and expand the network or let other traders in. It is interesting to note that Proof of Stake stands as an alternative to the traditional Proof of Work technique. Its development is recent and very young. 

The similarity between the two systems is that Proof of Stake also requires a significant amount of electricity and the internet to function. This requirement is because the process is a crucial part of trading. After all, security is the primary concern. The Proof of Stake process works better because it gives the most number of coins the power to the owner. While doing that makes attacks much less profitable to the miner who can commit such a thing.

Summing up the differences between PoW and PoS 

  1. The power to verify a transaction is divided equally between all the stakeholders in the Proof of Work technique. In the Proof of Stake technique, the owner of most of the coins has power over this. 
  2. The former makes it difficult for miners to enter the system and cause trouble. Whereas, in the latter case, the process makes attacking less profitable to the potential troublemaker. 
  3. Proof of Work was the first to verify transactions in a blockchain. Proof of Stake is a later development. 
  4. Ethereum uses Proof of Work. On the other hand, Bitcoin uses Proof of Stake. 


The difference between the two processes must be clear to you now. Both of them are ways in which one can verify the various dealings in a blockchain. Before you start dealing with or trading cryptocurrency, make sure to analyze the methods and understand them thoroughly to be safe and secure.

Leave a Reply

Scroll to Top