Proof of Work VS Proof of Stake: A Complete Analysis

The aim of blockchain technology is to formulate a public ledger with no external authority over the network. In this respect, there are certain questions like who verifies the financial transactions? How can the blockchain say that you are not trying on the same fund more than once? These questions are answered by Proof of Work (PoW) and Proof of Stake (PoS). In this article, we will see a distinction between Proof of Work VS Proof of Stake. 

The nodes that are present in the blockchain network are responsible for the verification of the transaction. But how do they do it? This is the time when PoW (Proof of Work) and PoS (Proof of Stake) comes into action. 

Understanding The Concepts 

Before we get into Proof of Work vs Proof of Stake it is important for us to know what is Proof of Work and what is Proof of stake individually. Then only we can evaluate their work. 

When Satoshi Nakamoto was formulating the very first digital currency, Bitcoin, he had to search for a way that would verify the transaction without the need of any third party. He achieved this when he was successful in building the Proof of Work system. Generally, Proof of Work is used to evaluate the way in which the blockchain reaches a consensus. In simple terms, how can the blockchain network be sure that the transaction that took place is valid and that someone is not trying to do bad activities? So the Proof of Work is based on the advanced formula of mathematics known as “cryptography”.

After the Proof of Work model became famous many blockchains started to use that code. So later many such codes were formulated among which the most successful and famous was the Proof of Stake model. This was first formulated in 2012 by two developers named Sunny King and Scott Nadal. The first ever project of blockchain that utilized the Proof of Stake model was Peercoin. So there is little distinction between PoW and PoS. so the Proof of Work vs Proof of Stake debate is quite common. 

Proof of Work vs Proof of Stake: At A Glance

Before we go on to the explanation let us have a look at the Proof of Work vs Proof of Stake pros and cons in the table mentioned below. 

Proof of Work (PoW)Proof of Stake (PoS)
The participating nodes are known as miners.The participating nodes are known as miners.
The capacity of mining depends on the computational power.Validating capacity depends on the network’s stake.
Mining produces new coinsNo new coins are formed
Miners receive block rewardsValidators receive transaction fees
Massive energy consumptionEnergy consumption is low to moderate
Significantly prone to 51% attacks51% attacks are virtually impossible

Proof of Work vs Proof of Stake: In Details

Now that you have known the distinction between PoW and PoS let us analyze the difference in detail. 

Proof of Work

In Proof of Work vs Proof of Stake security, the PoW protocol prevents fraudulent and duplicate transactions. Other digital currency blockchains also follow this PoW mechanism that was initiated for the Bitcoin blockchain. Each participant who is in the mechanism of the PoW consensus is called a miner. There are more than a thousand miners in a network. The Proof of Work is based on the advanced formula of mathematics known as “cryptography”. These complex mathematical problems can only be solved by the computers and confirm the transactions. So the miners will first have to solve the problem. The miner who solves the complex problem first earns the entire reward. One problem with the PoW is that it is not based on just one system. Miners who have more powerful hardware resources have a greater chance of being rewarded with new coins. The other miners in the network can receive zero rewards. The computers that use this protocol also consume a large amount of electricity. 

Proof of Stake

In Proof of Work vs Proof of Stake authority, the end result achieved is the same but the method is different. The miners are replaced with validators or forgers in Proof of Stake. These validators will keep their resources in the blockchain network at a stake. They will go on the next block that they feel should be inserted in the chain. Every validator or contributor will receive a reward as per their stake. Developers of Ethereum are planning to shift from the PoW (Proof of Work) method to PoS (Proof of Stake). So there will exist Proof of Stake Ethereum. In Proof of Work vs Proof of Stake, PoS consumes fewer resources of electricity during mining compared to PoW.


The blockchain technology is formulated to immune and secure digital currencies from cyber attacks. It is the most difficult job to hack a blockchain. And so there came PoW (Proof of Work) that was first used in the Bitcoin blockchain network. But later other cryptocurrencies started to adopt this technology so new codes were formulated among which PoW (Proof of Stake) is the most famous. Both provide the same result but in different methods. In the above article, there is a distinction between Proof of Work vs Proof of Stake. 

FAQ On Proof of Work VS Proof of Stake

1. Why is proof of stake bad?

The reason why we use such tools to keep records is precisely that the cost of record keeping is much less than the value of the asset that is being tracked. For such systems, their cons are that no matter how ironclad your records, they must be attached to the real world assets.

2. What is the difference between proof of work vs proof of stake vs proof of burn?

Proof of burn is the alternate of PoW and PoS while achieving distributed consensus.

3. Is proof of stake more energy efficient?

In the comparison between Proof of Work and Proof of Stake, PoS consumes fewer resources of electricity during mining compared to PoW.

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