Proof of Stake

Another type of consensus mechanism is proof of stake (PoS). PoS is used by some newer cryptocurrencies, such as Ethereum and Cardano. In a PoS system, participants stake their coins in order to validate transactions. The more coins you stake, the more probable you are to be chosen to validate a block of transactions. The advantage of PoS is that it is much more energy-efficient than proof of work. The disadvantage of PoS is that it can be vulnerable to attacks from whales (large holders of the currency).