Business is all about driving efficiency. By delegating the proof of stake, we will drive a far more efficient system than earlier implementations of Blockchain technology.
Proof of Work and Proof of Stake
In early Blockchains, when you wish to verify that X has happened you present a proof of work (i.e. evidence that you have performed an action) to the distributed network and then every computer within that blockchain network verifies your proof. When all the systems agree then your proof is accepted into the Blockchain. This is a highly resource-intensive and wasteful use of resources for most of solutions to come.
Proof of stake reduces the amount of energy usage, because validation is done using CPUs and hashing algorithms that do not require specialized hardware to run. However, it still requires all the systems on that network to agree, but each of those systems only control verification of part of the blockchain. You are still using more energy and taking more time to verify the data than required.
Delegating the Proof
In a delegated system — the one we will be implementing at Blockpool — only a select number of computers are chosen to verify the blockchain. Each participating delegate places their system up for voting by the public. The delegates who receive the most votes, in the case of Blockpool 201 delegates, get the privilege of what is called “Forging”. This method can be used for private chains in an affordable manner with very little maintenance needed by editing the number of delegates the private chain requires and having the company “vote” for the nodes which will be running the operation. Blockpool is also working on various other methods to improve upon the voting consensus while further reducing costs and making it easier for smaller companies to participate in “pseudo-private chains” which are private side chains which depend on public delegates running the Blockpool master chain.
Comparing the systems
Think of it like Parliament and a General Election. In a General Election, we each have a vote to choose our representative — whoever wins the election has been chosen by consensus. That individual then attends Parliament where they continue to vote as our representative. In a Delegated system, those who are chosen to verify are much like the Members of Parliament. They have been trusted to agree a consensus on the network’s behalf.
This is part of our introductory guide to Blockchain technologies. See the other posts in this series:
- What is Blockchain?
- Cryptocurrency
- Smart contracts
- Public vs private chains
- Delegated Proof of Stake
