Will Proof-of-Stake replace Proof-of-Work?
One of the major areas of concern in the blockchain industry is whether or not the validation method PoW (Proof-of-Work) can change. Using computing power to validate blocks of transactions has proven inefficient, energy consuming, and semi-centralized by large distributors of hardware like Bitmain. While this technology can still evolve, there are other methods of validation that are proving to be more promising. One of these is called PoS (Proof-of-Stake).
The PoS method is based on how many tokens you own of a given blockchain. Your "stake" in the blockchain determines your likelihood to be voted on to sign transactions. Essentially, the individual(s) with the most money get to validate the block.
PoS will theoretically be able to help different blockchain projects scale so that they can compete with legacy companies like Visa and Mastercard in transaction volume. While the technological upgrade is promising, there will surely be drawbacks, just like with PoW. With PoW, large mining operations tend to have more centralized control. In PoS, this will be the wealthiest stake holders.
In the end, it will be more crucial to increase scalability and cut down on energy consumption than it will be to maintain 100% decentralization across a blockchain network. Regardless, PoS is gaining traction and is here to stay.
Special thanks to CoinCentral.com for allowing us to reference one of their original articles in the creation of this article.
Link: Original CoinCentral.com Article
Reference: Smith, Ryan. What is Delegated Proof of Stake? Exploring the Consensus Algorithm. 3 July 2018.