What are POW and POS?
February 22, 2019 6:24 am,
POW (Proof of Work) and POS (Proof of Stake) are concepts that are closely associated with mining of cryptocurrency, most importantly Bitcoin. Cryptocurrency and Bitcoin are not strange words to people at this point. Almost everyone has heard at least any one of the two terms somewhere while browsing through the internet. The cryptocurrency and its concept of decentralized money transfer have been accepted by the community with open hands. Bitcoin is the most famous of all the cryptocurrencies and have paved way to hundreds of altcoins too. Decentralization does come with its fair share of security issues and to avoid this, developers seek the help of POW and POS.
Proof of work can be understood as a security or safety measure taken by developers to make the process of mining more standardized and un biased. Like the name implies, proof of work needs a proof from the miners to show that they have completed the work. In order for a miner to get Bitcoin as reward, the person has to check transactions that have been carried out in the platform. The checking is done by solving complex mathematical problems with the help of specialized software and hardware. In this case, the use of external hardware is the proof that works has been done.
Proof of Stake also has the same purpose as that of Proof of Work, which is to check the transactions carried out over the platform. Here, the basis of selection is not through solving a complex mathematical problem. Instead, a block is given to a person according to the stake they hold. Unlike the other way, there is no need for any heavy machinery or wasteful use of electricity when it comes to POS. But there is a chance for monopoly in the case of Proof of Stake as the rich keeps getting richer and richer.
POW vs POS
When it comes to the security aspect, POW is more experienced and tested by time. POS is a new concept and needs to be more secure. There is a freedom of selection awarded to the users if they use Proof of Work when there occurs any sort of forking. But when the resource saving aspect is looked at, Proof of Work serves as a better alternative. As mentioned earlier, proof of work needs additional hardware and software Installed to perform proper and quick mining, producing huge amount of heat at times. A large amount of electricity is also needed for the process. Proof of stake does not ask for such major requirements and indeed saves a lot of electricity. The bottom line is that both POW and POS have their own fair share of merits as well as demerits. It is up to the users to choose according to their needs and wants.
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