Have you heard of Bitcoin or Litecoin? These are all examples of what are called “Proof-of-Work” (PoW) cryptocurrencies. They’re the most well-known and popular type of crypto coins, but there’s another kind that’s starting to gain traction: Proof of Stake (PoS).
Proof-of-stake is a different way of reaching consensus in a decentralized network. In proof-of-work, the next valid block is chosen based on how much work the miner has done. In proof-of-stake, the next valid block is chosen based on the validator’s number of coins.
Let’s look at the updated list of Proof-of-Stake coins and determine if these coins are better for the environment and investment.
Cardano was founded by Charles Hoskinson in 2017. It is a smart contract platform built on a proof-of-stake consensus algorithm. Cardano has a very active development team and a large community. It is one of the most popular proofs of stake coins. Cardano has a market capitalization of $16.13B billion and a trading volume of $1.18B billion.
Ethereum 2.0 is the long-awaited upgrade to the Ethereum network. It is a smart contract platform that uses a proof of stake consensus algorithm. Ethereum 2.0 is often considered the most advanced and well-built blockchain platform. To stake this crypto, you’ll need at least 32 ETH to get started.
BNB rose to fame in May 2021 when it reached its all-time high of $681. After a slight dip, it has recovered and is trading at $274.12.Operating on the Binance Smart Chain (BSC), BNB follows the BEP standard to integrate smart contracts. BNB has a market capitalization of $54.5 billion and a trading volume of $1,044,855,484.
Solana is one of the best-performing staking coins. Solana is a fast and secure smart contract blockchain that can process more than 65,000 transactions per second without needing Sharding. In contrast, Ethereum processes an average of 17 TPS. The increased scalability makes Solana more advantageous for decentralized applications (DApps), as developers can achieve high levels of scalability with Solana.
Avalanche (AVAX) is a layer-1 network that functions as a hub for decentralized applications and custom blockchain networks. It uses the Proof of Stake consensus algorithm and can support up to 6,500 TPS. The way Avalanche verifies transactions sets it apart from other smart contract cryptocurrencies. Rather than requiring every node to validate each transaction, as is the case in Bitcoin, Avalanche has three sub-blockchains: one for payments and two more for data transfers.
Proof of Stake (POS) is a built-in consensus mechanism used by a cryptocurrency's network or validators. It cannot be earned, but you can help secure a network and earn rewards by using a cryptocurrency client that participates in PoS validating or becoming a validator.