Glossary
What is proof of stake?
In one sentence
Proof of stake secures a blockchain by having participants lock up coins as collateral instead of burning electricity — misbehave and the collateral is destroyed.
Proof of stake replaces computational work with economic stake. Validators deposit — “stake” — a quantity of the network’s coin. The protocol selects validators to propose and attest to blocks, and honest participation earns rewards.
Security comes from the collateral. A validator who tries to cheat can have part or all of their stake destroyed, a penalty called slashing. Attacking the network therefore requires acquiring an enormous stake and then deliberately forfeiting it.
The main advantage is energy: proof of stake uses a tiny fraction of what mining consumes, which is why Ethereum’s transition cut its electricity use by more than 99%. The main criticism is that influence follows existing holdings, which may concentrate control among large holders and staking services over time.
For example
Staking your coins is participating in proof of stake, either directly or through a service that does it for you.