Proof of Stake (PoS)
Web3 / mining staking
Proof of Stake is a consensus mechanism where validators replace miners and are selected to create new blocks based on the amount of cryptocurrency they hold and are willing to "stake" as collateral. Instead of requiring computational work, PoS systems choose validators based on their economic commitment to network honesty—if a validator acts maliciously or attempts to create conflicting blocks, their staked coins are partially or fully forfeited through a process called slashing. This approach dramatically reduces energy consumption compared to Proof of Work while maintaining network security through economic incentives and penalties. Example: Ethereum transitioned to Proof of Stake with "The Merge" in September 2022, eliminating energy-intensive mining and instead requiring validators to stake at least 32 ETH to participate in block creation and earn staking rewards. Why it matters for mining and staking: PoS enables more energy-efficient blockchain operations while maintaining strong security guarantees. It democratizes consensus participation by reducing hardware barriers, though it introduces new challenges around wealth concentration and validator economics that the industry continues to refine.
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