Crypto Academy Contest / S1W3 – Blockchain through the concepts by @steemdoctor1

Hello, everybody.

I hope that all of you will be good and happy and enjoying your fine health with the grace of Almighty God. Today, I am here to present my participation post in the Steemit Engagement Contests Week 3. This is actually the participation post in the SteemitCryptoAcademy. The topic of discussion for today is Blockchain Through the Concepts. So, let's start the task without any waste of time.

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Blockchain

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The word "Blockchain" is derived from two words that are Block and Chain. The word block means segments and so we can say that the Blockchain is actually the chain of segments. Now, a question arises in our mind whose segments these are? So, I would like to clarify that a Blockchain is a chain of the segments that comprise the information or data.

Actually, a Blockchain is a digital form of a database. As we store our precious and important data in the database, similarly, in the blockchain, data is stored in the form of blocks. Blocks are actually the storage units of the blockchain where the information of the transactions is stored in detail.

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Whenever a transaction is made in a blockchain, the information related to that transaction is stored in the block and when a block is completely filled with the information, it is closed and linked to the previous block, thus forming a chain that is known as the Blockchain. Blockchain technology is very popular due to its use in cryptocurrencies.

Actually, blockchain technology is very old technology but it was used for the first time, in cryptocurrencies by Sir. Satoshi Nakamoto 2008 when developed the most successful cryptocurrency, Bitcoin. Since then, Blockchain technology is making progress day by day and had entered the lives of living beings.

The data stored in a Blockchain is immutable. The data that is once stored, can never be edited or changed again. It is stored permanently in the blockchain and is viewable at any time. The most advanced countries are using blockchain technology for the storage of their precious and sensitive data.

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Blockchain Through the Concepts

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As we have discussed the Blockchain is in a short but clear format. So, now I am going to discuss that the blockchain is actually comprised of many components that work properly for the exact function of a blockchain. There are some consensus protocols or mechanisms that are used by the blockchain in order to store and validate the transactions that are made in that blockchain.

As we all know that blockchain technology is growing day by day and new blockchains are coming into view with unique and impressive features. Some blockchains try to improve the faults that were seen in the previous blockchains. So, different consensus protocols or mechanisms have been developed. Some of them are Proof of Stake (PoS), Proof of Work (PoW), Delegated Proof of Stake (DPoS), Proof of History (PoH), and many more. But my favorite consensus mechanism is the Proof of Stake (PoS) so I will discuss it.

Proof of Stake

The Proof of Stake (PoS) mechanism is the alternative to the first-ever mechanism that is known as Proof of Work (PoW). The PoS mechanism is the most common and the most used consensus mechanism in blockchain technology. Most of the new blockchains are based on the Proof of Stake mechanism. Its high use is due to its various advantages and the most important point is that there is no need for a heavy computational system for the validation of transactions in this mechanism.

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In the blockchains that are based on the Proof of Stake mechanism, the transactions are verified by the validators that are selected on the basis of their staking. In simple words, we can say that the users have to stake the respective tokens in order to act as the validator or node that can validate the transactions and add new blocks to the blockchains. This thing is very impressive as the validators are not selected on the basis of a heavy computational system, as in the Proof of Work.

The validators of the transactions are rewarded with a valuable block reward that is actually the earning of the validators. The block validators are selected on the basis of the amount of the staked tokens. The more the amount of the staked tokens, the more the chances for him to act as a block validator.

Importance of Proof of Stake in Blockchain

The Proof of Stake mechanism is very much important in blockchain technology due to its number of advantages as compared to the traditional mechanism, Proof of Work. Some of the important points are discussed below.

• Some people thought that the Proof of Stake mechanism is very important in the increase of the price of a token. Yes, it is true. When a huge amount of tokens is staked and a low amount of it is circulated in the market, the demand for that token increases, and hence the price is also increased. This is a very important thing about the PoS mechanism.

• In the PoS mechanism, the validators are selected on the basis of their sharing to the blockchain and not on the competition-base, as in the Proof of Work mechanism.

• We can consider the Proof of Work as the king of security and decentralization but it lacks scalability. The scalability of a blockchain could be improved with the use of the Proof of Stake mechanism.

• In the PoS mechanism, there are more chances for an investor to act as a block validator as the validators are selected on the basis of the amount of staked tokens. While in the PoW mechanism, the miners are selected on the basis of the energy means the resources of a user.

• Another importance of the PoS mechanism is that there is no need of purchasing high-level hardware devices. The users can only stake their tokens and could act as a validator in the blockchain.

• The energy consumption in the Proof of Stake mechanism is much less than that of the Proof of Work mechanism. In PoS, the users have to spend money only one time while purchasing the tokens, but in the PoW, the miner has to continuously take care of the hardware machinery and the energy source as well.

Existance of Blockchain Without PoS and its Alternatives

Yes, the existence of a blockchain is easily possible with the Proof-of-Stake mechanism. I would like to say a line in this regard that the PoS mechanism is only a feature of a blockchain and it is not a basic building block of a blockchain. Initially, the Proof of Work (PoW) is used in the blockchains. The first-ever cryptocurrency, Bitcoin, also uses the Proof of Work (PoW) mechanism.

Without the Proof of Stake, the blockchain will be less scalable, secure, and transparent. The data that is stored in the blockchain with Proof of Stake could be at the risk of modification or change. There are a number of alternatives to the Proof of Stake mechanism. These alternatives have their own working principles and pros or cons as well. Some of them are listed below.

• Proof of Work (PoW)

• Proof of Authority (PoA)

• Proof of Weight

• Proof of Burn (PoB)

• Proof of Elapsed Time

• Delegated Proof of Stake (DPoS), an extension of PoS.

etc,

Cons of Proof of Stake

As we all know that nothing is perfect in this universe. Everything has some shortcomings and the same is the case with the Proof of Stake mechanism. Some of them are discussed below.

• First of all, the PoS mechanism is a new mechanism and is not considered much secure as compared to the PoW mechanism in which security is a must factor due to the expend of high computational systems.

• Another criticism of PoS is that in this system, the rich become richer. A person who holds a good amount of tokens in a PoS system can act as a validator and after validating the transactions, he becomes richer after accepting the block rewards.

• The biggest disadvantage of this system is the 51 Percent Attack. It is actually a condition during which a single person can control the blockchain by owning more than 50 percent of the total tokens of the blockchain. n this way, that person can damage the other participants of the blockchain. This thing is also noted in the PoW mechanism.

• In PoS, there are more chances of a validator to act as a validator in the future as well. This is because of the fact that the staking of that participant increased by validating a transaction thus more staked tokens could be helpful for him to act as a validator in the future as well.

Possible Improvements in PoS

Following improvements can make the working of Proof of Stake better than now.

• As we have discussed that there are security issues with the Proof of Stake blockchains. The nodes have been many times attacked by hackers which is a great issue for the blockchain. There should be a proper security system to avoid such losses in the future.

• I think, the 51 percent attack technique should be removed from the blockchain. The participants or the pool of participants can merge their staking and control the working of the blockchain. Thus, the other participants are at risk of damage. This thing must be improved.

• Today, we can see that the most successful and the busiest blockchain, Bitcoin, is adopting the PoW. The PoS should improve its features and work including the efficiency and workability In order to improve its progress.

Some Blockchains Adopting PoS

As I have told you earlier that most of the new blockchains are preferring the PoS instead of the PoW mechanism. Some of those blockchains are given below.

• Cardano (ADA)

• Avalanche (AVAX)

• Polkadot (DOT)

• Solana (SOL)

• Tron (TRX)

• Algorand (ALGO)

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Conclusions

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Proof of Stake (PoS) is a consensus protocol that is used by various blockchains in order to validate the transitions and create blocks on the blockchain. In PoS, the validators are selected on the basis of the number of tokens they have staked. The more the amount of staked tokens, the more chances to be a validator.

The major advantages of the PoS mechanism are high scalability, no need for heavy hardware or computational systems, etc. The security of the PoS could be improved to act as the most successful mechanism.

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I would like to invite my friends @alihussain07, @msquaretwins, @msquaretk, @wentz, @abdu.navi03 here to participate in this amazing contest.

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Participant: @steemdoctor1

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