Proof of Stake (PoS)
A consensus mechanism where validators are selected to propose and attest to new blocks based on the amount of cryptocurrency they have staked as collateral. PoS replaces energy-intensive computational competition (PoW) with economic stake as the security mechanism — validators risk losing their staked tokens (slashing) if they act maliciously. PoS is significantly more energy-efficient than PoW and is used by Ethereum, Solana, Cardano, and most modern blockchains.
“Ethereum transitioned from Proof of Work to Proof of Stake in September 2022 ('The Merge'), reducing its energy consumption by over 99% while maintaining network security through 32-ETH validator stakes.”
Staking
The process of locking up cryptocurrency as collateral to support blockchain network operations — specifically validating transactions and producing blocks — in exchange for rewards. Staking is the core economic mechanism of Proof of Stake blockchains. Stakers earn yield from block rewards and transaction fees but risk slashing (losing a portion of their stake) for misbehavior or extended downtime.
Validator
A network participant in a Proof of Stake blockchain that is responsible for proposing new blocks, attesting to the validity of blocks proposed by others, and maintaining the integrity of the network. Validators must stake a minimum amount of the native token as collateral and run node software continuously. They earn rewards for honest participation and face slashing penalties for misbehavior.
Slashing
A penalty mechanism in Proof of Stake networks that destroys a portion of a validator's staked tokens for malicious behavior or severe negligence. Slashable offenses include double-signing (proposing two different blocks for the same slot), surround voting (contradictory attestations), and prolonged downtime. Slashing creates strong economic disincentives against attacks, as validators risk permanent loss of capital.
Consensus Mechanism
The method by which a decentralized blockchain network reaches agreement on the current state of the ledger and which transactions are valid. Consensus mechanisms solve the problem of coordinating untrusting parties without a central authority. Major types include Proof of Work, Proof of Stake, Delegated Proof of Stake, and Proof of Authority.
Proof of Work (PoW)
A consensus mechanism where miners compete to solve computationally difficult cryptographic puzzles (finding a hash below a target difficulty) to validate transactions and create new blocks. The first miner to find a valid solution broadcasts it to the network and earns the block reward. PoW's security comes from the immense cost of computation — attacking the network requires controlling 51%+ of the total hash rate, which is prohibitively expensive for major chains.