Proof-of-Work Vs Proof-of-Stake: A Comparative Analysis and an Approach to Blockchain Consensus Mechanism
Husneara Hamid Sheikh Sheikh, Rahima Meer Rahima Azmathullah, Faiza Rizwan Rizwanul Haque · 2018
Blockchain is a pioneering technology which has brought huge popularity for new virtual currencies where in transactions are recorded after being verified. The transactions are then verified by many clients or validators, to solve the reliability issue among several nodes implemented in digital currency's peer-to-peer network. Though there are different alternate consensus algorithms available, the most commonly implemented algorithm are Proof of Work (PoW) algorithm and the Proof of Stake (PoS) algorithm. In this paper, we present a comparative study of distinctive consensus algorithms that are currently applied in modern blockchain. This analysis focus on the consensus mechanism, reward of the validator who invests time to mine or verifies the block, and the available security risks available within the algorithm. Also, we will discuss the difference in basic characteristics and cryptocurrencies used in an algorithm. Finally, we will conclude future trends for consensus algorithms used in blockchain.