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RE: Ethereum will change to proof of stake end of this year!
hi thanks @spike1004 so I wonder how much people will get for staking 1 etherum, have you heard anyone mention possible stake percentages?
hi thanks @spike1004 so I wonder how much people will get for staking 1 etherum, have you heard anyone mention possible stake percentages?
@carface,
Its not really staking your "coins" for other coins. Its kind of using your coins for trying to unblock another coin in the algorithm.
On this way there is no risk of losing your coins, but its like mining with coins. The more you have the more % of earnings you get. This is a way where you dont need to invest allot of equipment and this doesnt uses allot of electricity wich is also good for our nature.
Here some "short" benefits of making it proof of stake:
In short:
No need to consume large quantities of electricity in order to secure a blockchain (eg. it's estimated that both Bitcoin and Ethereum burn over $1 million worth of electricity and hardware costs per day as part of their consensus mechanism).
Because of the lack of high electricity consumption, there is not as much need to issue as many new coins in order to motivate participants to keep participating in the network. It may theoretically even be possible to have negative net issuance, where a portion of transaction fees is "burned" and so the supply goes down over time.
Proof of stake opens the door to a wider array of techniques that use game-theoretic mechanism design in order to better discourage centralized cartels from forming and if they do form from acting in ways that are harmful to the network (eg. like selfish mining in proof of work).
Reduced centralization risks, as economies of scale are much less of an issue. $10 million of coins will get you exactly 10 times higher returns than $1 million of coins, without any additional disproportionate gains because at the higher level you can afford better mass-production equipment.
Ability to use economic penalties to make various forms of 51% attacks vastly more expensive to carry out than proof of work - to paraphrase Vlad Zamfir, "it's as though your ASIC farm burned down if you participated in a 51% attack".