Proof-of-Stake (PoS)
Proof-of-Stake gives the right to write a block not to the strongest computer but to whoever has locked coins in the network. The stake is the guarantee of honesty: misbehave and part of it is burned.
How it works
A validator posts a stake and earns the right to propose blocks. Turns are assigned pseudo-randomly but weighted by stake size: a larger stake means more turns and more income.
Honesty is enforced by penalty. A validator that signs conflicting blocks or goes offline for long has part of its stake taken, a mechanism called slashing. Attacking becomes expensive not in electricity but in your own locked money.
Ethereum switched to it in September 2022, cutting the network's energy use by roughly 99.9%. Running your own validator there takes 32 ETH; smaller amounts take part through delegation or pools.
What a validator stands to lose
The scale of penalties on Ethereum for a 32 ETH stake.
| Being offline | about the income foregone |
| Double signing | from 1 ETH upward |
| Correlated failure | up to the whole stake |
The penalty scales with how many fail at once. That way the network punishes a coordinated attack rather than an individual mistake, and incidentally rewards spreading across providers instead of one cloud host.
What to weigh
- The energy saving is realA validator runs on an ordinary server, not a farm. Hence a drop in consumption of three orders of magnitude.
- The large stake earns moreIncome is proportional to stake, so concentration grows over time. That is the substantive objection to the design.
- Coins are not instantly freeExiting has a waiting period, and the price keeps moving throughout it.
- Delegating does not remove riskA validator's slashing hits its delegators too. Choosing an operator is choosing risk, not only a fee.