Proof of Stake (PoS)

A decentralized consensus mechanism and Layer 2 solution using network participation to validate block creation and confirm transactions. Participation in Proof of Stake requires nodes/network validators to commit a personal stake of the underlying asset to be locked for a stipulated time period, similarly to posting collateral. As opposed to Proof of Work, Proof of Stake does not require any specialized mining hardware, only internet connectivity and a stake of the cryptocurrency. In PoS, the next block creator is chosen randomly or on a stake characteristic, such as stake quantity (how many tokens staked) or age of an active node. To incentivize the validator for staking their personal assets to secure the network, the block creator is rewarded with a transaction fee in the underlying cryptocurrency. To discourage bad actors from attacking or attempting to manipulate the network, validators who act or are revealed to be acting malicious have their stake destroyed.