Financial Technology
Proof of Stake is a consensus mechanism used in blockchain networks to validate transactions and create new blocks. Unlike the traditional Proof of Work system, where miners compete to solve complex mathematical problems, Proof of Stake allows validators to create new blocks based on the number of coins they hold and are willing to 'stake' as collateral. This method not only improves energy efficiency but also promotes network security and decentralization by reducing the need for massive computational power.
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