Homework task:10

(1) What is the difference between PoW & PoS? Advantages & Disadvantages? Which one is better in scaling Capacity? Examples?

Question 1

Proof of work

It is the process where the Cryptocurrency are secured from double spendings and its proper Consensus mechanism where complex mathematical relations are associated with transactions to secure and record them in public ledgers. Thus eliminating the double spending it termed as proof because the basis of transaction are noted and confirmed so other parralel transaction are ignored verified transaction are generalized in public ledgers.

The working or new blocks is maintained firstly in unconfirmed pool or ledger where the strategic apex concept might enlightened here the miners working as operational core where they attempt the puzzled mathematical relations and verify the transaction. The transactions are stamped and winners might get different rewards as per rules of different platforms in bitcoin they earned btc and roughly the time consumed is about 10 mins. The winning policy is deemed under the race whoever attempted to do the transaction first is considered to be valid transaction.

Howbiet the proof of stake means to prevent and restrict the double spending, they won't Bitcoin as stable and worthy currency though they need proper algorithm for this digital marketing and their transaction process by this effort of proof of work the currency can achieve its goal easily. Although miners are elected randomly and reselect by the operation of transaction in Blocks and whoever attempted to solve the

Whoever reaches the goal first wins a batch of bitcoin cryptocurrency. Then the Bitcoin protocol creates a new value that miners must hash, and miners start the race for finding the winning proof-of-work all over again.

Pow is not feasible for long term and scaling capacity and reliability of energy is inefficient we will discuss them briefly in further discussion.

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Proof of stake

It's also blokchain Consensus mechanism that gives initiative to the validator to confirm their validity based upon their skating abilities. The more the staking the higher the validation chances increases and aint need high amount of energy consumption, however a certain some of assets are locked in Pos.

Hacking and fraudulent activity are mostly occur in Pos. Thus people mostly avoid and use pow although extreme amount energy might consume there. Although pos also support a centralised structure and the rewards are higher than pow but security issue mostly activated here.

Might people still use proof of stake more rather than proof of work becuase the most used consensus algorithms by btc is proof of stake, becuase the stability of currency also maintain by holding certain some of asset always in stake thus it is necessary for miner the more they stake the more validation chances increases.

Advantages and Disadvantages

Let's talk about some merits and demerits;

Proof of work:

ADVANTAGES

• The proof stake provide security and scalability gowards the digital transaction that are occurs hence the hacking and all fraudulent activities are eliminated.

• The consensus mechanism of Pos provides the traceability and reliability towards transaction by verification of each block with clear authentication also eliminates the third party involvement.

• Proof of work runs in a way that the transaction are validated by the miner by attained the puzzle mathematics in to proof of work and again the verification of transaction held and PR cess start over again thus the all over working is maintained in a definite and specialized way.

• Enhances competition between miners they have to attempt and complete the puzzle to attains the transaction or further validation process thus further incentive are also their to boost the miners abilities.

DISADVANTAGES

• Cost inefficient thus you need high devices computer to attains the transaction thus thsi was the eorst drawbacks only hesltyhy trader can enjoy the market but ultimately the computers are costly sot they also unlike this content.

• Might some one attains to manage these high programming computers but ultimately they have bare the electrical energy consume by this computers and their energy heats the entire computer further the hardware might suffers thus in all over aspects these are very costly and people termed cost inefficient.

• So the main drawback is cost which tends the miners to move towards proof of stakr because heavy cost reduces public and only few moners will attempt to participate although its decentralized system and totally based on public participation thus if the cost ain't bare the miners would move towards better and less cost effective algorithm which is proof of stake.

Proof of stake:

ADVANTAGES

• Having minimum use of energy for validating the transaction though they are considered better consensus algorithm. Thus the complexity of mathematical calculations are also eliminated here since people are required to stake some of the Cryptocurrency in their wallet then validation will be accepted on bases of crypto they staked.

• The porof stake based on the ideal concept that the miners who carried the higher staked crypto in their wallets would be engaged in Pos, because it is essential criteria which i observed regarding a good option for for miners and they would pull each other to staked higher and platform will also be in advantage.

• They Eliminates centralization because the working you know ain't satisfied centralization ir any sort of hirarchy structure thus more validation required high and decentralized level of consensus algorithm.

• The profitability of miners are base on the fixed amount of percentage that they have agreed upn at the time of agreement hence they won't be afraid of the market attack and can enjoy the profit alone by reducing the market fear.

DISADVANTAGES

• The fraudulent activities are the main disadvantage of proof of stake people justify one thing that if they use Pow the energy and cost they are bearing are actual but if fraudulent activity might occur they won't like it and this thing mentally distracted them from Pos.

• Miners should stake certain some of assets to get participation in Pos if ain't the validation chances might decreases thus your assets would be locked to the period you participate in Pos.

• Different platofrm have their own rules and Crptocurrency to get participation thus Individual having healthy wallets can take initiative in Pos.

Reliability towards scaling capability

The difference between proof-of work and proof-of stake enlightened above though the main thing which polarizes them is scalability capability. As you know the proof stake having the ability to minimise the cost and increases the reliability thus attemping the probable speed to create new blocks and efficiently, resulting Proof of stake made highly effective consensus protocol brought up the efficient Scalability capabilty by addresing new transaction and parralel to proof of stake which seems to be highly cost inefficient.

Hence it seem proof of stake is efficient and effective to add new blocks faster with effective speed rather than proof of work.