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Delegated Proof of Stake (DPOS) consensus mechanism
The delegated proof of stake (DPOS) is also one of the top consensus mechanisms that has been around for quite some time now. DPOS is basically consensus mechanism that was created after the proof of stake, as an alternative, to offer high performance and more energy efficient. The delegated proof of stake DPoS consensus mechanism operates a little bit differently from the regular proof of stake. The DPOS was created in 2014 by Dan Larimer who is known for his works at bitshares and steem. DPoS operates on an election process where coin holders vote for delegates who are assigned the role of validating transactions on the network and adding new block in the chain. DPOS was developed as an alternative to the POS, and is seen to have its benefits as compared to the POS.
DPOS operates like digital democracy where the witnesses or delegates are elected or voted by stake holders on the network. These witnesses or delegates reach agreement in order to validate transactions and add new block to the chain. Depending on the blockchain network, DPOS blockchains have their own set of rules that govern the network. A fixed number of witnesses that ranges from 21-101 or in some blockchains 20-100 are chosen for each new block. This means that a witness for each new block might vary. These witnesses who were elected and voted by the stake holders of the network are rewarded for validating transactions and adding new blocks on the chain.
Stake holders who are users who stake their coins in the network becomes eligible proportionally vote for witnesses based on the number of coins staked. Also, in DPOS blockchains, stake holders are able to delegate their stake to other stake holders on the network who then votes on their behalf. For producing new blocks, witnesses take their turns to produce new blocks every few seconds. In some DPOS blockchain networks, the witnesses have a stake to show commitment in the network. Examples of DPOS blockchains are;
- Steem
- EOS
- Tron
- Bitshares
Proof of stake (POS) consensus mechanism
The proof of stake (POS) is without a doubt one of the top consensus mechanisms that has been around for quite some time now. Proof of stake is basically consensus mechanism that is considered the second most popular consensus mechanism created after the popular and king of consensus mechanisms known as the proof of work. POS was created as an alternative for the proof of work to be more efficient. In POS, nodes who are known as the validators or block producers secure the network by validating transactions and adding new block to the chain. The validators or block producers in the POS are selected based on the amount of stake each of the nodes have on the network. These validators are rewarded through the network fees.
The nodes who are the validators on the POS, stake their assets to become eligible to be selected randomly to become validators or block producers on the network. The more coins each node has staked on the network, the higher the chance of being selected. Once the validator has been randomly selected, they are responsible for securing the POS network by verifying transactions on the blockchain network and adding a new block on the chain. Also, apart from the amount of coins the nodes have staked on the network, how long it have been staked are taken into consideration in order for the nodes to reach consensus. Examples of POS blockchains networks are;
- Cardano
- Polkadot
- Zilliqa
- Cosmos
