In the blockchain industry, Pow and Pos are the two most mainstream consensus mechanisms, which are used to verify and confirm transactions in the blockchain network and determine who has the right to create new blocks. Among them, Pow appeared the earliest and Pos has the widest adoption. The comparison between the two is mainly in three aspects: security, decentralization and energy consumption.
Some people believe that decentralization is the foundation of the industry, and the advantages of sacrificing decentralized blockchain technology will disappear; some people believe that to achieve broader prospects and applications, solving energy consumption is an inevitable result. After years of development, the discussion between the two is still very intense. Below, we will take you to fully understand Pow and Pos from three dimensions.
Security comparison
Pow maintains network security by consuming computing power, which requires physical mining machines. If you want to attack the network, you need to control 51% of the computing power to achieve it. The cost of the attack is extremely expensive and difficult to achieve. Pos is to obtain network power by staking tokens. The more tokens staked, the more chances of obtaining blocks. It is also necessary to stake more than 51% of the tokens to achieve network attacks.
Here, we need to judge whether it is more difficult to have 51% of the mining machine computing power or 51% of the tokens. In fact, both are very difficult, but the key lies in the development of the project. If there are not many validators in the early stage of the project, there is also the possibility that a few validators will have more than 51% of the computing power. But if the number of participating miners is large enough and dispersed, it is basically impossible to achieve network attacks.
For example, the total amount of Ethereum staked is 34,450,522 ETH, and the total number of validators is 1,074,806. If you want to attack the Ethereum network, you need to stake more than half of the ETH, that is, 17,225,261ETH. According to the current ETH price of $2,629, you need to have $45,285,211,169 in assets to do it. Of course, there are definitely people in the world who have so many assets, but such people will not destroy the network.
Decentralization Comparison
The definition of decentralization mainly revolves around whether the computing power is sufficiently decentralized. If a network has a large computing power but is very concentrated, then its degree of decentralization must be very low. If the network computing power is sufficiently decentralized but not large enough, then it is possible to obtain a larger proportion of computing power at a lower cost, so the degree of decentralization must not be high. Then go back to the two consensus mechanisms of Pow and Pos for analysis.
To mine Pow tokens, you need to buy specific mining hardware, which has a higher entry threshold than staking. On the other hand, since the Pow network has the ability to resist long-range attacks, attackers need to continue to spend energy to maintain control of the network, so in the long run, it is very difficult to tamper with the Pow blockchain (immutability).
In Pos, the only way to protect the network from successful long-range attacks seems to be to roll back the blockchain, which completely violates the idea of immutability (decentralization). At the same time, there are many staking protocols that attract stakers to stake tokens through their networks through liquidity staking or re-staking. For example, Lido in the Ethereum network currently has more than 9,806,741 ETH staked, accounting for 56.93% of Ethereum staked, which puts the Ethereum network at great risk of centralization.
Energy consumption comparison
The discussion on energy consumption of the two consensus mechanisms is also a major focus.
The Pow system relies on miners to compete for the right to verify blocks through a lot of computing power. Miners need to use specialized hardware (such as ASIC mining machines) to continuously perform complex mathematical calculations, and this calculation process requires a lot of electricity. According to statistics, the Bitcoin network’s electricity consumption in 2022 reached 204.5 terawatt-hours, exceeding the electricity consumption of Finland.
At the same time, as the difficulty of the network increases, miners must constantly update their hardware equipment to remain competitive, which not only increases electricity consumption, but also generates a lot of electronic waste.
Unlike Pow, the Pos system does not require a lot of calculations. Validators only need to compete to become block validators based on the number of tokens they stake (i.e., equity). Since there is no need for complex computing competition, the Pos system greatly reduces the demand for computing resources and electricity. Since Ethereum switched to Pos consensus, its energy consumption has dropped by 99.95%.
If we compare energy consumption alone, Pos is undoubtedly a better choice. But just like there is no perpetual motion machine in the world, any desired result requires a huge cost. The high market value of Bitcoin and the large consensus are directly related to the mining machines and electricity costs it has invested. Imagine if it can be mined at zero cost, will the price of Bitcoin still be so high? In a bear market, the price of Bitcoin falls, and the mining cost of miners is the most important basis for supporting the value of its tokens.
About Starcoin
Starcoin provides the utmost security from the origin via its enhanced PoW consensus and Secure smart contract, using the language of Move. Through layered and flexible interoperability, it optimizes the building of ecosystems such as DeFi, NFTs, Gaming, etc., with higher efficiency and convenience. This process redefines value by empowering every participant in the ecosystem to enjoy the multiplication of values.
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