Proof of Stake

Proof of Stake (PoS) is a consensus mechanism used in blockchain technology that determines who validates the next block, according to how many tokens a participant holds and is willing to 'stake' as collateral. In PoS-based cryptocurrencies, the creator of the next block is chosen in a deterministic way, depending on its wealth, also defined as stake. Unlike Proof of Work (PoW), where miners must use significant amounts of computational power to solve complex mathematical puzzles, PoS aims to achieve the same end in a more resource-friendly manner. It offers enhanced speed and energy efficiency compared to the PoW system.