A few years ago, cryptocurrency was seldom spoken about. However, cryptocurrency is currently rapidly gaining popularity and is being accepted and preached all over the world. Cryptocurrency is digital money that secures your transactions via the decentralized blockchain.
It is a secure and immutable ledger. No one can access our data or trace our transaction information. People use it for security measures in large numbers. As a result, numerous new currencies are entering the market. Every coin was worth something. These cryptocoins are widely accepted in many locations for payment and other reasons. As a result, it’s worth is progressively growing.
The coins mostly go with a proof of work (PoW) algorithm. But what is it that causes cryptocoins to prefer the PoS algorithm?
What is PoW and what makes it an issue?
In cryptocurrency, PoW works on a consensus algorithm. Cryptocurrencies commonly utilize this to validate new transactions. Miners have a significant part in proof of work. They solve complicated mathematical equations that can only be carried through by sophisticated computers to validate a transaction. When a new block is formed, a new mathematical equation is formed; the miners must solve in order to add the block to the chain by competing with other miners. Cryptocurrency is awarded to the miner who solves the equation.
PoW necessitates the installation of several nodes in order to avoid 51% of threats. As the network is used more, the energy consumption rises. Bitcoin mining
consumes about 0.5 percent of all worldwide electricity use. Think about alternative crypto mining processes as well. Millions of people from all over the world are involved in this mining process to validate transactions and earn free cryptocoins. It has a significant impact on the environment. Simultaneously, as time and usage go, the mathematical equation becomes more complicated, it increases consumption of more energy and slows down the transaction speed.
The cost of setting up the hardware requirements is quite high, since it necessitates the use of several separate hardware components. As the network’s size and popularity expand, so do the hardware needs also increase, and network capacity declines. It has harmful effects on the environment. To overcome these, Beldex is moving towards the PoS algorithm.
PoS is the way to go:
Beldex is changing from a PoW to a PoS algorithm. i.e., Proof of Stake. The masternode stakers will have the opportunity to validate a block. The preference goes to the stakers instead of miners. Even the hardware setup requirements are also less and consumption of electricity is not as much as PoW.
Every stakers will get a chance to validate the block. They need not to compete with each other because the process goes in an order, so the transactions are completed fast. For each validation, they will get rewards too. The hardware requirements stay constant as the network expands in size and acceptance. Hacking appears to be impossible because holding 51 percent of all coins is economically difficult.
PoS helps to reduce the energy level at large amounts and make it more eco-friendly to the environment. Think green and move to Beldex PoS.
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