Proof of Work vs. Proof of Stake: Beginner's Guide!! 👨🏫
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- Опубліковано 30 тра 2024
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- TIMESTAMPS -
0:00 Intro
1:51 Cryptocurrency Consensus Explained
5:51 What Is Proof Of Work?
10:24 What Is Proof Of Stake?
13:42 PoW: Strengths & Weaknesses
16:32 PoS: Strengths & Weaknesses
21:05 Conclusion: Which Is Better?
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⛓️ 🔗 Useful Links 🔗 ⛓️
► Proof Of Work Vs Proof Of Stake: www.coinbureau.com/analysis/p...
► Proof of Work Explained: academy.binance.com/en/articl...
► Proof of Stake Explained: academy.binance.com/en/articl...
► In Favor of Proof of Work: www.danheld.com/blog/2019/1/5...
► In Favor of Proof of Stake: vitalik.ca/general/2020/11/06...
► Proof Of Work Cryptocurrencies: cryptoslate.com/cryptos/proof...
► Proof of Stake Cryptocurrencies: cryptoslate.com/cryptos/proof...
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👨🏫Cryptocurrency Consensus Explained👨🏫
Consensus in cryptocurrency follows the same idea as consensus between people. The difference is it’s computers coming to a consensus AKA an agreement about whether a transaction is valid or not. Usually, the consensus threshold in cryptocurrency is more than half, or 51%
⛏What is Proof of Work?⛏
Any computer that wants to process transactions on a proof of work cryptocurrency blockchain like Bitcoin needs to solve a complex equation to earn the right to do so. This costs time and energy to do
If this sounds tedious and arbitrary, it’s because it is. This idea of work exists exclusively as a means of protecting a cryptocurrency from manipulation by the computers connected to its blockchain
💰What is Proof of Stake?💰
Instead of using large amounts of computing power and energy to solve an equation to process transactions, a cryptocurrency coin is staked i.e. locked on the blockchain to earn the right to do so
The length of time a cryptocurrency must be staked to process transactions can vary, as can the minimum amount of coins or tokens a computer must lock up as stake
Logically, the more cryptocurrency you stake, the more likely you are to process transactions and create a block
⛓PoW: Advantages and Disadvantages⛓
In theory, anyone can connect their computer to a proof of work cryptocurrency to process transactions and earn cryptocurrency as a reward for doing so
However, over the years companies have developed specialized computers called application specific integrated circuit machines or ASICs for short. This is gradually centralizing PoW cryptocurrencies
What’s worse is that when a new and improved ASIC is released, the older model usually ends up in a landfill, and this is one of the many environmental concerns about proof of work cryptocurrency mining
💱PoS: Advantages and Disadvantages💱
In theory, anyone can connect their computer to a proof of work cryptocurrency to process transactions and earn cryptocurrency as a reward for doing so
This is facilitated by the minimal hardware and energy requirements to participate in most proof of stake cryptocurrency blockchains
However, most proof of stake cryptocurrency blockchains have high thresholds when it comes to the minimum stake you need to put down to connect to it as an independent computer
Moreover, most proof of stake cryptocurrencies had something called a premine which is where a bunch of coins or tokens are minted in advance and distributed to the team and large investors
Consequently, most proof of stake cryptocurrencies are more centralized than Bitcoin and Ethereum since the average user is stuck delegating to a validator or staking pool belonging to the team and VCs
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📜 Disclaimer 📜
The information contained herein is for informational purposes only. Nothing herein shall be construed to be financial legal or tax advice. The content of this video is solely the opinions of the speaker who is not a licensed financial advisor or registered investment advisor. Trading cryptocurrencies poses considerable risk of loss. The speaker does not guarantee any particular outcome.
#bitcoin #blockchain #consensus #staking #mining #pos #pow
Hope this overview is useful guys! Don't forget to follow me on some of my other social channels. We have some important updates in the pipes ;) 👉 guy.coinbureau.com/socials/
Is Proof of History even better than Proof of Stake?
@@rishabhjain109 Did you ever ate stake before.
Crypto is just a giant ClickFunnels
source: am investment banker
Keep calm and hodl on Guy. Great video again. Thanks for explaining the difference between the two methods
Please suggest a book to learn technical analysis from basics to pro level.Any online help also would be of great help
Welcome to coin bureau, the largest crypto channel in the whole inter-webs, add free, transparent and no clickbait titles like other (small) crypto channels ;) Finally!
Bybit….bybit…..anyone wanna use bybit and get rekt?
BitBoy can't handle this channel being the biggest 😂
There's a channel called Bitboy? 😂 Funny, it never came up in my feed ... Wonder why? 😏
Which is why they shouldn't be mentioned at all:) Can't compare apples and oranges xD
@@nachocheezed 😆
@@D3athW1ng he's for beginners when you get beyond I start learning and researching yourself you won't need that channel corn bureau is perfect
@@lastcall8286 all good .. just teasing 😆
Ah the biggest crypto channel on the inter-webs.
I was trying to scrape that hair off my screen
And he dont brag like bitboy
And best
In the war between bitboy and CB, it’s an easy choice
I've been waiting for this day for AGES! Grats Guy! Finally overtook that clickbait producer.
Congratulations!!!
Your channel is the # 1 crypto channel, you passed BitBoy!
Well done, you deservedly.
Who’s bitboy? Sorry,I only looking for education channels
@@qinghualao7079 you can search with word Benjamin bitboy
GUY the ONLY youtuber that really cares about u and not about that sweet commission from referral links
@Ninja Eyes I know, but it’s not on ur face and he barely mentions the referrals
Haha...but there is a well organized and impressive Team behind guy, the guy who does referrals and timestamps is on it for sure...lol
No Adds or sponsors - so they monetize under the hood, 100% OK
We all witnessed the “Flippening” of the largest crypto channel in al inter-web
At last the best CRYPTO channel is now the biggest, congratulations well deserved.
Do you trade, hold , margin trade or future trading bitcoin or any other ?
and your comment is nice
Congrats,... the largest crypto channel by subscribers. :) Btw, BitBoy might not like this so much. 😂
And well deserved too
Quality content here only 👌👌👌
Congrats on being the Biggest crypto channel on UA-cam! You deserve it man! Super happy for you!
I agree wt you Chris
80,000 more subscribers than Bitboy!!
My guy is doing god's work in terms of education.
You make lengthy content that's easly digestible even for folks like me that have a low attention span(ADHD),
Cheers to the
Coin Bureau team!
I guess the whole world has ADHD these days
Only USA and western europe made up word for being bold
dont be shy
its the best content u can find on youtube
Adoption of "improvements" should be a slow and tedious process. The "improvement" in question should only be adopted if its value proposition is so compelling that it can inspire consensus among the many disparate actors forming the network.
Simple. POW and POS are Sybil mechanisms. Sybil mechanisms are used to prevent people from creating multiple identities and take over the network. POW uses hash power, POS uses stake power as a limited resource.
And also, POW and POS are not consensus mechanisms. They are Sybil Resistance mechanisms.
Congratulations sir You Are the Best....you don't give fake shit that's the best thing about you...
Excellent explanation as always 👍
Could you do DAG vs “zero” knowledge proof?
Congratulations Guy for being the biggest crypto youtube channel!!!
Trading systems allow you to limit the factor of emotional influence on decision-making,
as well as to give the trade a certain degree of systemic character.
This is very correct.
To the newbies, you should also note that this data is worthless without an existing understanding of data analysis,
Nothing interests me than talks about Bitcoin and how to make money trading forex.
you will understand when you have a good coach like expert Eric Campbell.
As the BTC highest use case is as an asset, it is critically important to keep it with the most secure validation method. I like that it keeps to proof of work ....for now anyway...lol.
I agree 100%. Proof of work is critical to bitcoin. I’d most likely sell all my bitcoin if it moved to PoS, which I don’t see happening.
Do you mind if I introduce you to a more reliable and profitable investment company where I invest and earn 50% rate everyday?
Thanks Guy..please do a vid on the 'Types of Pos' we have in the space and explain in a nutshell how they work/are secured nd the differences between them.. E.g Pos , SPos , NPos , PPos etc.
You can explain concepts of each and match some examples to them 🌟🙏🏆
I'm actually glad he got number 1 crypto channel, defo deserves it
Yes Alan....how are you?
That jacket is like something from a fortnite skin. Looks awesome!
Congratulations Guy. You're number 1!!!
Unless I’m mistaken, in 🇬🇧, interest earned on staking is classed as income, not capital gains. The same as airdrops on the day you receive them.
The biggest crypto channel in the interwebs!
BIGGEST Channel in ALL INTERWEBS!
Congratulations on becoming #1 in the Crypto UA-cam space you passed Bitboycrypto
Because Guy speaks & explains clearly , not just hype up coins tokens etc , bit boy talks so fast sometimes I get lost and lose my train of thought 🤣🤣
Do you trade, hold , margin trade or future trading bitcoin or any other ?
and your comment is nice
I was just about to research this area, perfect timing. Big up the notification crew!
hijacking this comment to make everyone aware that there is one project that managed to scale Proof of Work, while being energy efficient AND improving decentralization + security
It's called Kadena and can do 480,000tps, why is no one talking about this?
The explanation is amazing. The way you broke it down and pieced it back together made me go ooooooh okay
Thank you you guys are back! Glad you guys got your youtube account back
So happy to see your channel is now officially bigger then Bitboy 😍
Go check it out
Just love your videos. It makes me feel so smart when I actually follow along with things
It’ll be interesting to see how well proof of stake holds up when huge amounts of money are at… stake. In other words, in my opinion PoS has not been proven to be effective.
PoS will get attacked, it's not secure and or battle tested like PoW, we need to scale PoW, and there is only one project that managed to do that, kadena.
@@lynxlagoon POS will cost a lot of money to attack. it isn't going to happen. PoW has been hit countless times with 51% attacks.... name i time PoS has been forced to do a hard fork because of hacks/attacks?
Cardano has held up with 20-40 billion USD worth of stake (70+% participation) for quite a while now. It's definitely very difficult to do, so skepticism is reasonable imo. IOG had to publish so many papers to have all the known attack vectors sorted out and peer reviewed to be sure they did not miss anything. But the cost efficiency of PoS potentially working is definitely worthwhile to explore.
THE PROFESSOR IS HERE AND HE IS ONE HELL OF A GUY !
This GUY is crazy...I don't understand how he gets & understand such complicated information & makes it so easy to understand for beginners like me
Congrats I have been watching you for years always deliver on point messages
Want to give props to your AV, guy… very professional work. Do you have any videos that discuss the possible implications of quantum computation on the future of the network security? You have a way of making these “technical” things make more sense.
Algorand has the lowest staking requirement of only 1 ALGO. It's also not susceptible to attacks types that plague other PoS systems.
Fantastic as always! Extremely comprehensive!
I’m new to crypto and still learning. Your channel is one of the main ones I watch to learn about crypto. This channel is excellent! I appreciate that there aren’t any ads interrupting at the most awkward times and I love how you explain things easily and clearly. Your crypto swag is 🔥 your crypto rhymes are 🔥 Thank you for providing all of this awesome info!!
PoS system leads to centralization and can impact it's core protocol due to this type of centralization. With PoW people like you say miners equipment is expensive and it gets centralized. But miners do not have any special powers to control the BTC protocol. They just create and provide a block to the nodes and keep network secure. If nodes do not accept it, they can't do anything. Miners are more like service providers to Bitcoin where nodes are the actual users/participants or bitcoin. Same with protocol changes. Miners can't do shit without majority of nodes agreeing. The more participants we have running simple nodes, the more resilient the network is thereby providing true decentralization. When blocksize war happened majority miners wanted to change block size but failed coz nodes didn't accept it. All you need is a node to participate in any changes proposed. It's super easy to run Bitcoin node due to the size of block and transactions are account to a simple ledger. That's why it stays easy in future. Unlike application blockchains like ETH where it'll get increasingly harder and harder to run a full node. But anyone can run a node with simple hardware on Bitcoin now and in future. That's how BTC stays truly decentralized.
Congrats! Yours is officially the largest crypto channel on the UA-cam platform. Some other channel can no longer make that claim.
I told that other channel he needs to change his intro now haha
He does otherwise he would be spewing a lie, lol!
upvoted for not mentioning the name of the competing channel.(no need to advertise that here)
Guy and the Coin Bureau are at much higher level and deserve to be the top crypto channel.
Thank You for an excellent and easily understandable description and explanation of Proof of Work v.s Proof of Stake Consensus Mechanisms. Despite being concise you present information with such good examples that it makes it very convenient to grasp the basic concept of Blockchain and Crypto technology. No wonder your subscribers are increasing day by day and that is good to see.
Thanks Guy, very informative! Well delivered as usual.
The only cryptocurrency channel that has no ads.
Good to see you back
Cardano process transaction will be very fast with their proof of stake system and so much ppl staking their tokens.
Btw I love Slash 🎸😉
How many asic silicon manufactures are there? If you have to buy specific hardware... that's centralized. If you have to be next to cheap power... that's centralized.
Guy, the 5 o'clock shadow died with Sunny Crocket in the 80's
Do you trade, hold , margin trade or future trading bitcoin or any other ?
and your comment is nice
Great vid as always!
Man you cover so much knowledge around Crypto, you're a damn saint for the work you put into your videos. Thanks dude.
You and Thoughty2 are the only people I have subscribed to in the last couple years. I figure posting this here will help spread his videos and I will mention you on his channel. Much love
Guy love your vids. Always get excited whenever your videos get uploaded 🙂
EXCELLENT VIDEO!!! Thank you, you explained this process in a manner that even I can understand how it works. Well done sir!
Guy overtaking BitBoy is a surefire sign of a bear market: people are getting smarter and more cautious, people actually want to learn smth instead of jumping at those random shitcoins without any fundamentals. My congratulations to the channel!
Very educational... very thankful for the knowledge earned from watching this video Mr. Guy. Thank You!
I have nothing but respect for the work you do. This again is a really good intro to PoW and PoS. That being said a little correction: PoW and PoS are *not* consensus algorithms. Their goal is to protect against sybil attacks. In the case of PoW for bitcoin (and others) the consensus algorithm is simply always look at the longest chain (which works because of the work put there). For PoS this is less clear (it does not work to chose the longest chain) and, hence, another protocol layer, the actual consensus algorithm, is needed. In case of future Ethereum that would be the rules regarding the pseudo-random selection of block proposer and slashing rules. Avalanche, also PoS, has a very different consensus algorithm which does not randomly select a block proposer but works through random vote sampling. I hope this shows that these are not the same concept: sybil resistance vs consensus algorithms.
Do you trade, hold , margin trade or future trading bitcoin or any other ?
and your comment is nice
Yes, PoW and PoS are not consensus algorithms, but rather consensus mechanisms.
Guy thanks for helping a Newby like me to understand this complicated adventure. PS: I saw that you are a music fan as I noticed your Recording Studio in another of your videos. I am a Vocalist and former Agent and spent time in the UK in the 1980's
thank you for spelling Iran right
Great tutorial Guy! Thanks
Muchas gracias amigo guy.
I do both.
PoW is more stable and better in long term, biggest downside is hardware cost, longevity og the hw and electric cost. Safest are multi coin miners or GPUs. Some of the coins could die. Its happening a lot in PoS coins. They die or get rug pulled often promising high rewards. Advanatge of PoS is that you can move the coins from pool to pool anytime anywhere. Rewards drop significantly when new users join the pool. Ive moved from PoS to PoW because its more profitable and stable for me.
honestly this is one of the more useful vids
Quality content as usual 🙌🏾🙌🏾
I hope this means you got your account back! Good to have you
Great content as always, and congrats for the lead 🏆
I no longer binge-check prices, instead I enjoy learning from this channel
Valuable stuff
YOU DO GREAT WORK!
POW and POS are complimentary to the ecosystem. When security is the main concern, POW and decentralization are king (I.e. Bitcoin). For smaller, more frequent operations POS makes more sense.
I knew you'd be able to break it down the best thx
That was excellent very well explained it's something I didn't understand and I have a better understanding of it now thank you
Welcome to the coin burea - the biggest crypto channel in the galaxy 🤩. We all want to buy you a pint Guy but I think that it would see you off! Big up yourself and thank you!
Thank you! Great as all ways!
#1 crypto channel. Congrats!
How do you manage to make a video about a subject I want to learn more about every single time? Keep up the great work!
Another great video! Thanks Guy!
these videos are my heart and soul on crypto. thanks Guy
The information on here is top notch.
Very easy to digest even for newbies.
Brilliant, well explained thanks
Always the best content in the space
I think this video was awesome, but I think that addressing Proof of Storage would also be very interesting. Love you work
Just started watching your videos. Your intro sounds pretty arrogant, but it is justified. This is the highest qyality crypto content I've seen.
Thanks for your work.
Great analogy, cheers
Nicely explain!
Always a great guy for guides
Highest quality content indeed.
Hi there,
Your content is incredibly valuable and I highly thank your efforts for providing quality education.
Love your work guy 👍
Staking all the way, most sustainable
It seems the best advice is to keep calm and hodl on. Time will tell.
GREAT content! Thanks!
Best crypto channel by far. Congrats 👍
Awesome vid, Guy
Amazing explanation with everyday examples
I did not hear "not financial advice"😂
PoW is required for sound money. PoS is more suitable for smart contract enabled blockchains
Absolutely, and I would be surprised if PoW is ultimately used only by BTC since transaction time is critical for commerce and minimally considered for moving large sums of money. This being said, the future may involve BTC upholding the value of tokens which are used in day to day spending transactions on a PoS chain.
Thank you for the info sir
Congratulations to Coin Bureau for having the most subscribers of a crypto channel. Learned lots of great info that helped to save me and my family money!