If you keep up with the news in the crypto community, you might have heard about Ethereum's plans to switch from PoW to PoS. Some miners are even planning to 51% attack the Ethereum blockchain to punish, the developers. But what do all these terms mean? What is a PoW or a PoS, and what's their difference? How does a 51% attack work? In this post, I will do my best to clear up all these terms for you!

  Proof of Work(PoW), is a process that helps blockchains avoid attacks, such the distributed denial-of-service attacks(DDOS) or spam. The concept exists since 1999, however, the creator of Bitcoin, Satoshi Nakamoto, was the one to popularize the term in 2008. To better understand how PoW works, we first have to understand what blockchains are. 

  Blockchains are a decentralized ledger that contains the record of every single bitcoin transaction. Each block in the chain contains the hash value of the previous block, the timestamp of creation, and the information about the transaction. Every time a new transaction occurs, a record of the transaction is added to every participant's ledger. Since, every block is connected to the previous block's hash, it's virtually impossible to hack the blockchain. In addition to that, every participant having the same ledger makes the system decentralized, hence impossible to fake a transaction.

  PoW is necessary when adding a new block to the blockchain. The people that bring blocks to life are known as miners. To mine a block, miners have to guess the hash matching Bitcoin's current target. The hashes look something like "0000000000000756af69e2ffbdb930261873cd71". It's nearly impossible to guess, but miners use supercomputers that run through billions of options every second, hence it takes somewhere around 10 minutes for every hash to be guessed. After this, Bitcoin generates a new hash, and miners start guessing again.

   Unfortunately, PoW uses huge amounts of energy. According to BBC, Bitcoin uses more energy per year than all of Argentina combined.

   Luckily, the Proof of Stake(PoS) was created as an alternative to PoW. But what is PoS? Just like PoW, PoS is a consensus mechanism, used to validate the state of the blockchain. In PoS, miners are replaced with validators. To become a validator, one needs to stake their cryptocoin. For example, the Ethereum network requires users to stake at least 32 coins to become validators. Later, validators are chosen at random to validate blocks. Every time a block is validated as "true", the validator is awarded ETH. However, Ethereum also punishes validators if they 1. Validate a false block or 2. They fail to validate a block.

   Since PoS doesn't require as much energy as PoW, does that mean that PoS is better? Not necessarily. Let's look at each methods cons and pros.

        Pros of PoS

• Eco-Friendly, and energy-efficient
• More people can run the nodes, making the blockchain more decentralized

        Cons of PoS

• PoS hasn't been used widely yet, and we don't know much about it, except the theoretical part.

         Pros of PoW

• Security
• Has been used by Bitcoin for over a decade and for trillions of transactions - has never failed.

         Cons of PoW

• Uses a lot of energy

• Since only very powerful piece of hardware is useful in mining, not a lot of people can afford it. It leads to the blockchain being centralized around rich people

  Both PoS and PoW, however, share one common flaw - If a lot of miners come together, they can 51% attack the blockchain. A 51% attack refers to a situation where one person, or a group of people, gain access to 51% or more of the computing power. Since they control the major part of the blockchain, they can prevent new transactions from happening and prevent other miners from earning crypto.

   There is a lot more to learn about this topics. So here is a list of websites you can read:

• https://www.coindesk.com/proof-of-stake
• https://www.investopedia.com/terms/p/proof-stake-pos.asp
• https://coinifide.com/proof-of-work-vs-proof-of-stake-what-are-the-key-differences/#:~:text=The%20first%20con%20of%20Proof,the%20network%20becomes%20more%20centralized.
• https://www.investopedia.com/terms/1/51-attack.asp
• https://www.investopedia.com/terms/p/proof-work.asp
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