Proof of stake vs proof of work a simple explainer
Proof of stake vs proof of work a simple explainer
Proof of stake vs proof of work a simple explainer compares two ways a public chain decides which block comes next. Ethereum’s documentation describes its proof-of-stake design. Satoshi Nakamoto’s Bitcoin paper describes proof of work. This article is not investment advice, and it does not predict a price.
The Ethereum proof-of-stake page and the Bitcoin paper are the sources. Figures those documents print stay on those documents. The job of this explainer is to name the two jobs and how they differ.
What proof of stake vs proof of work a simple explainer is naming
On the Ethereum page, proof of stake means a validator puts capital, in ETH, into a contract on Ethereum. The page says that capital can be destroyed if the validator acts dishonestly. The validator checks that new blocks are valid and sometimes creates a block. The page’s examples of dishonest action are proposing more than one block when one was required, and sending conflicting votes. The size of the deposit is printed on that page.
The same page says a validator runs an execution client, a consensus client, and a validator client. After the deposit, the validator joins a queue that limits how fast new validators start. Once active, the validator receives blocks, re-runs the transactions to check the proposed state, checks the block signature, and sends a vote the page calls an attestation.
Proof of work, in the Bitcoin paper, is a different job. Nodes collect transactions into a block and spend computation searching for a result that meets a difficulty target. The paper treats the chain with the most of that work as the chain honest nodes extend. Changing an old block means redoing that work and the work of the blocks after it. This explainer does not turn that design into steps for attacking a chain.
How a block gets its place
The Ethereum page describes a transaction from signature to vote. A user signs with a private key, usually through a wallet, and offers a tip so a validator will include the transaction. The page says the tip goes to the validator and the base fee is burned. It does not set a price for this article to quote.
An execution client checks that the sender has enough ETH and that the signature matches. If the transaction is valid, the client keeps it with other pending transactions and tells other nodes. The page also notes that some users send a transaction to a block builder instead of broadcasting it. That is a description, not a recommendation.
One validator is the block proposer for the current turn. The page says the choice is pseudo-random. That node builds a block, has the execution client run the transactions, and passes the result to the consensus client together with the reward and vote data the page lists. Other nodes re-run the transactions. Validators that agree send an attestation. Finality, on that page, is a later step between checkpoints. The vote share used for that step is printed on the page.
Under proof of work, the Bitcoin paper does not assign the next block in advance. Miners search until someone finds a qualifying result. Other nodes check the result and the transactions, then start work on the next block. The paper’s rule is to extend the chain that represents the most work. Two honest miners can find blocks close together. The following block decides which branch continues, because nodes extend the branch that then has more work.
Where the two designs part
The split is the resource and the clock. Proof of stake, as the Ethereum page describes it, uses a deposit and three pieces of software. Time on that page is a sequence of turns: a proposer is chosen, other validators vote, and finality is a later checkpoint step. Proof of work, as the Bitcoin paper describes it, uses computation against a difficulty target. The wait is the search itself. Nobody is assigned the next block before the search succeeds.
The people in the story are different, too. A user on the Ethereum page signs a transaction. A validator runs the three clients, attests, and sometimes proposes. A block builder, mentioned on that page, is a separate role some users send transactions to. A miner, in the Bitcoin paper, is the node spending computation. Using one word for all of them blurs the two designs. This explainer keeps each word on the page that defined it.
The Ethereum page says a validator who does not take part misses rewards, and a validator who proposes conflicting blocks or conflicting attestations can lose stake. It names a correlation penalty, an inactivity leak, and a fork-choice rule that follows the fork with the greatest weight of attestations. The percentages and the timelines are on that page, beside those names. The Bitcoin paper’s security section says an attacker has to redo the proof of work and outpace the honest chain. Read that section in the paper. This article does not reprint it and does not suggest a pool, a machine, or a fee.
Ethereum’s page says the network moved from proof of work to proof of stake, and it lists energy use, hardware, and the number of programs a validator runs. Those points stay in the page’s own list. This article does not rate a pool, a client, or a token. Proof of stake vs proof of work a simple explainer does not include commands or a shopping list.
Set the two jobs next to each other and the comparison is done. In proof of stake, the job is a deposit, three clients, an attestation, and sometimes a proposed block. In proof of work, the job is computation toward a difficulty target, then extending the chain with the most work. A yield, a price, or a countdown is not part of either job as this explainer states them.
Open the Ethereum page when you want the deposit size, the vote share, or the penalty schedule. Open the Bitcoin paper when you want the proof-of-work argument in the author’s own words. Both pages can change, so the copy on the site is the one to trust. A wallet balance, a chart, or a headline is not part of either design. If someone asks which chain will be worth more, these two documents do not answer. They describe how a block becomes the next block.
Read them in this order and then stop. First, what a validator deposits and which three programs it runs. Second, how a signed transaction reaches a block and a vote. Third, the Bitcoin paper’s search and its rule about the chain with the most work. When you can say those two clocks without a number you did not just look up, the explainer has done its job. A useful note has two columns. One column is the Ethereum page: a deposit, three clients, a vote called an attestation, and sometimes a proposed block. The other column is the Bitcoin paper: a search for a result that meets a target, then the chain with the most work. If a cell would only be true with a figure, open the source instead of copying the figure. That is the whole of proof of stake vs proof of work a simple explainer.
Do not add a third column for a market. Neither source is a price page. A headline that names a coin and a number is not a third design. The two clocks above are the difference: a chosen proposer and a vote, versus a search that nobody is assigned in advance.
Say the difference out loud once, in one sentence each, before you close the tabs. Proof of stake on the Ethereum page is a deposited stake, software a validator runs, and a vote on a block someone was chosen to propose. Proof of work in the Bitcoin paper is a search that spends computation until a block meets a target, after which honest nodes extend the chain with the most of that work. If your sentence needs a percent, a fee, or a date to sound finished, delete the sentence and point at the page instead.
That pair of sentences is the explainer a reader can repeat. It does not tell them to run a validator, to buy a machine, or to move coins. It tells them which document describes which job. When the documents update, the sentences above yield to the documents. The explainer stops there.
Keep the wallet out of the comparison. A wallet signs a transaction on the Ethereum page. It is not the validator and it is not the miner. If a diagram in your notes has the wallet proposing the block, redraw it. The proposer is the validator the page selects. The miner is the node in the Bitcoin paper that finds a qualifying result. Those are the only two makers of a block in this explainer.
The photograph is Backlit laptop keyboard keys by ChromeGames923, Wikimedia Commons, licence CC BY-SA 4.0.
