What’s the difference between Proof-of-Work, Proof-of-Stake, Proof-of-Burn and other Proof-of-Xs? Globe of Blockchain — from gravity4.com Background Recently, as the flaws of Proof-of-Work(PoW), the consensus algorithm employed by Bitcoin, grow harder to disguise. Various alternatives such as Proof-of-Stake(PoS), Proof-of-Burn(PoB) and many of them emerged, contriving hard to take over their ancient precursor, PoW. This swift guide is about to introduce several popular Proof-of-Something(PoX) to you from the shallow view of outsiders. First thing first, let’s welcome our main actor to the stage— . Consensus Algorithm : Anyone can create blocks, but this algorithm makes all of us agree on a single trustful state of , without the need of trusting each other or a third party authority. Consensus Algorithm blockchain To achieve the consensus within the network, everyone needs to something, or some valuable resources. sacrifice (PoW) Proof-of-Work : Electricity (computational power). Sacrifice : A miner who has a machine that can run on the blockchain network. Participant SHA-256 : A miner utilize the machine to solve extremely difficult math puzzle, and generate mining reward from it. How : The math puzzle validates the transactions that happened on the , and stores them in the chain, block by block. This keeps the chain trustful and hard to change. [ ] Why network Detail : , ( ), and a whole lot of others. Players Bitcoin Ethereum moving to PoS (PoS) Proof-of-Stake : Coin Days (The value that accumulates when holding coins). Sacrifice : Anyone who hold coins. Participant : Someone who holds 1 coin for 1 day will get 1 Coin Day, which can be used to generate coins. How : The people who holds more coins for more days has higher collateral, who can vouch for the validation of transactions. These people reasonably has higher tendency to keep the chain honest. Why : , . [ ] Players Peercoin Blackcoin More (PoB) Proof-of-Burn : Coin. Sacrifice : Anyone who has coins (and can suffer the pain of burning them). Participant : Someone who sends their coin to an unspendable address. How : Similar to PoS. The burnt coin were generated from PoW-mined coins (or fuels). It prevents the possibility of inflation by burning coins. Why : , TGCoin (Third Generation Coin) Players Slimcoin (PoI) Proof-of-Importance : The importance of the user (calculated from the number of transaction the user made, plus the coins the user hold) Sacrifice : Not only the passive coins hold, but also the active transaction history is captured. Encourage user’s contribution to the network. Why : Player NEM (PoSV) Proof-of-Stake-Velocity : The stake(the amount of coins hold) and velocity(the frequency of making transaction). Sacrifice : Similar to Proof-of-Importance. Why : Player Reddcoin (PoC) Proof-of-Capacity : Disk storage or memory. Sacrifice : Anyone who has storage space. Participant : Someone allocates a usable and non-trivial storage space that used to solve math puzzles. How : No need for high computational power, anyone can mine coins at home as long as they have sufficient spare space for mining. Why : Player Burstcoin (PoD) Proof-of-Deposit : The freedom to use coins. Sacrifice : Anyone. Participant : The control of disbursement will be removed for a period of time. How : The economical purpose is similar to PoS and PoB. To fuel blockchain, some internal resources are required to be sacrificed. Why : None so far. Player Ends Thank you for your time. Hope you enjoy this article. :) Feel free to point out any mistake or provide any suggestion. I wish to learn from you as well. Thanks! More Resources and Great References: Discussion about Proof-of-Deposit on bitcointalk Tragedy of Commons Difference between PoW and PoS Popular PoS currencies

Chain

Velocity

Blockchain Virtual Mining: Proof-of-Anything

About Author

Comments

TOPICS

THIS ARTICLE WAS FEATURED IN

Related Stories

[Beginner Guide] Write and deploy your first ICO smart contract under 30 minutes (stage 1)

(1/100) Crypto Countdown: Golem

A Research Report on the Trader $JOE DeFi Platform

07/03/2018: Biggest Stories in the Cryptosphere

05/02/2018: Biggest Stories in the Cryptosphere

01/06/2018: Biggest Stories in the Cryptosphere

[Beginner Guide] Write and deploy your first ICO smart contract under 30 minutes (stage 1)

(1/100) Crypto Countdown: Golem

A Research Report on the Trader $JOE DeFi Platform

07/03/2018: Biggest Stories in the Cryptosphere

05/02/2018: Biggest Stories in the Cryptosphere

01/06/2018: Biggest Stories in the Cryptosphere

Light-Mode

Classic

Newspaper

Minty

Dark-Mode

Neon Noir

Minty

HN StartUps