Proof of Stake (PoS) Definition - Glossary

Proof of Stake is a consensus mechanism where validators are chosen based on the number of coins they hold and stake.

Proof of Stake is a consensus mechanism used in blockchain networks to validate transactions and create new blocks. Unlike Proof of Work, which relies on computational power, PoS selects validators based on the number of coins they hold and are willing to "stake" as collateral. Validators are incentivized to act honestly because they risk losing their staked coins if they validate fraudulent transactions. This system is more energy-efficient than PoW and aims to make blockchains more scalable. PoS also encourages participants to hold and support the network, leading to potentially more stable and secure blockchain ecosystems.