Proof of Stake
A consensus method where validators lock up cryptocurrency to help secure a blockchain and earn rewards for proposing or verifying blocks.
Proof of Stake is a blockchain consensus mechanism that chooses validators to create and confirm new blocks based partly on how much of the network’s native cryptocurrency they have staked, or locked up. Instead of using specialized computers to solve energy-intensive puzzles, validators put their own coins at risk. If they follow the rules, they can earn rewards; if they act dishonestly or carelessly, they may lose part of their stake through a penalty called slashing.
It matters because it is a common way for blockchains to stay secure, process transactions, and agree on the state of the ledger without relying on Proof of Work mining. Ethereum, for example, uses Proof of Stake: users can run validator software with the required stake, or often participate through staking services or pools. A simple comparison is a security deposit: validators are trusted to help maintain the network because misbehavior can cost them their deposit.
Other terms in Mining
Cloud Mining
Renting remote cryptocurrency mining hardware or hash power from a provider instead of running miners yourself.
GPU Mining
Using graphics cards to perform the calculations needed to secure certain proof-of-work blockchains and earn newly issued coins or fees.
Mining Rig
A specialized computer setup used to run mining software and perform the calculations needed to secure proof-of-work blockchains.
Orphan Block
A valid mined block that is not included in the main blockchain because a competing block was accepted by the network first.