Proof of Stake

The same reality is apparent with Proof of Stake (PoS), an alternative consensus mechanism now popularized by Ethereum. PoS was meant to incentivize honest behavior by rewarding those who put their crypto up as collateral in order to earn a yield. What this meant, however, was that the control of the network rapidly shifted into the hands of the few.

Ultimately, governance of any network is about power, and power is all about incentives. Today, there is a conflict of interest between the miners/validators and network users in PoW and PoS blockchains. Users would benefit from faster and cheaper transactions, but in general, this will decrease the profitability of miners and validators, reducing their profits.

Last updated

© Entirety and SELF 2024