Proof of Work vs. Proof of Stake: Beginner's Guide!! 👨🏫
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- čas přidán 2. 06. 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
~~~~~
📜 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
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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
Congrats on being the Biggest crypto channel on CZcams! You deserve it man! Super happy for you!
I agree wt you Chris
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
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
We all witnessed the “Flippening” of the largest crypto channel in al inter-web
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.
Congrats,... the largest crypto channel by subscribers. :) Btw, BitBoy might not like this so much. 😂
And well deserved too
Quality content here only 👌👌👌
Congratulations sir You Are the Best....you don't give fake shit that's the best thing about you...
dont be shy
its the best content u can find on youtube
Just love your videos. It makes me feel so smart when I actually follow along with things
Thank you you guys are back! Glad you guys got your youtube account back
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?
Excellent explanation as always 👍
Could you do DAG vs “zero” knowledge proof?
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.
80,000 more subscribers than Bitboy!!
Congrats I have been watching you for years always deliver on point messages
Fantastic as always! Extremely comprehensive!
Thanks Guy, very informative! Well delivered as usual.
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.
Very educational... very thankful for the knowledge earned from watching this video Mr. Guy. Thank You!
Thank you! Great as all ways!
Muchas gracias amigo guy.
I knew you'd be able to break it down the best thx
EXCELLENT VIDEO!!! Thank you, you explained this process in a manner that even I can understand how it works. Well done sir!
Congratulations Guy. You're number 1!!!
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 🌟🙏🏆
Man you cover so much knowledge around Crypto, you're a damn saint for the work you put into your videos. Thanks dude.
Congratulations on becoming #1 in the Crypto CZcams space you passed Bitboycrypto
That was excellent very well explained it's something I didn't understand and I have a better understanding of it now thank you
Amazing video!!! congrats. learning a lot from your videos.
THE PROFESSOR IS HERE AND HE IS ONE HELL OF A GUY !
Thanks for your work.
Great tutorial Guy! Thanks
GREAT content! Thanks!
Guy love your vids. Always get excited whenever your videos get uploaded 🙂
The explanation is amazing. The way you broke it down and pieced it back together made me go ooooooh okay
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
Another great video! Thanks Guy!
Brilliant, well explained thanks
YOU DO GREAT WORK!
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.
I hope this means you got your account back! Good to have you
Great analogy, cheers
Great vid as always!
Thank you for sharing. subscribed
Great content as always, and congrats for the lead 🏆
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
Good to see you back
Hi there,
Your content is incredibly valuable and I highly thank your efforts for providing quality education.
such good content. thank you!
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
Quality content as usual 🙌🏾🙌🏾
Congratulations Guy for being the biggest crypto youtube channel!!!
Great informational video.
Thank you for the info sir
u r the best ! thanks bro
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!
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.
honestly this is one of the more useful vids
Thanks for the news
Excellent content, really like the way you’ve explained with easy to understand examples
Do you trade, hold , margin trade or future trading bitcoin or any other ?
and your comment is nice
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.
Always a great guy for guides
Nicely explain!
Always love getting financial advice from Guy!
Not financial advice! 🤣
Appreciate all your efforts!
Hello Christopher
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 no longer binge-check prices, instead I enjoy learning from this channel
Valuable stuff
I think this video was awesome, but I think that addressing Proof of Storage would also be very interesting. Love you work
I'm actually glad he got number 1 crypto channel, defo deserves it
Yes Alan....how are you?
Amazing explanation with everyday examples
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.
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.
Guy my guy. I was actually looking for this and you happened to be posting it today.
Same
Love your work guy 👍
Great video , very educative
This was so much knowledge presented as simply as possible. Great video.
I think a part of creating decentralization is educating people how the technology works and how it can solve problems in todays society. I just wish we will collectively be able to decide, that decentralization is something good to happen.
Algorand has the lowest staking requirement of only 1 ALGO. It's also not susceptible to attacks types that plague other PoS systems.
Always the best content in the space
The biggest crypto channel in the interwebs!
Excellent explanation of PoW and PoS without taking a bias approach. You showed each side's pros and cons and for that you deserve my like and subscribe.
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.
Not at all. PoS is just a scam
love your sweatshirt!
i didn't understand all the key points in first view. I had to watch the video twice but that's ok absolutely worth watching. Thanks for such videos Guy. 👍🏻
Highest quality content indeed.
Another good session!
You are a legend, and on this day... you became the largest crypto channel in all the interwebs 😉
Thank you for breaking this information down, it reduces the FUD, and actually allows people to be educated and learn. Most channels are either about unnecessary hype or using jargon which no one understands, and the main purpose, is to try and get user adoption. You are the balance. Keep it up, you are the guy!
Thanks! I learned something new today!
Do you trade, hold , margin trade or future trading bitcoin or any other ?
and your comment is nice
@@Chatbox_of_ANTI-CHEF i hold and margin trade
Perfect disclaimer, thank you very Guy. your up to date crypto education has mine a crypto geek out me.
Do you trade, hold , margin trade or future trading bitcoin or any other ?
and your comment is nice
Useful, thanks.
Another brilliant episode
Great stuff, as always. I just took a few pages of notes from this video. Would be cool to see a comparison of PoS vs. DPoS some day. Thx, Guy!
Hi
Nice tips 100% sure!
His explanation is really really good.
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.