Mining by Leasing Proof of Stake (LPoS) Waves

By Thiago Capuano | Waves Beach | 6 Aug 2019

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We have already heard of the rewards received for acting to aid blockchain decentralization through block confirmations, especially the most well-known Proof of Work (PoW) and Proof of Stake (PoS). This article will cover the Waves Leasing Proof of Stake (LPOS).

Let's just start with a basic brushstroke on the famous Working Proof (PoW) to warm up, a little more on Proofing Stake (PoS) for a general understanding and dealing specifically with Waves Proofing by Leasing Proof of Stake and its various advantages over to other mining models.

Proof of Work (PoW)

Well known, mainly because it is the method used by Bitcoin, it requires from the miner a computational power, or rather a strong processing unit, and the greater the difficulty existing or created in the blockchain network, the greater the demand for this power, thus requiring a more powerful equipment, forcing the miner to purchase more expensive and energy-efficient equipment to make the mining cost-effective and / or to compel him or her to switch from mined currency to a more appropriate mining capacity. . In short, it all depends on your hardware.

Proof of Stake (PoS)

It has a much more economical method of mining, where the coin owner, in most cases after a period of maturity of the non-moving coins, becomes qualified in the identification and block recognition participation thus confirming the transaction, is a very superficial explanation focused more to the understanding, if there is one among the readers who has a deep knowledge of PoS operation, forgive me, the idea here allows absorption by those who have no technical knowledge but would like to understand.

To support this as mentioned in the previous paragraph, after maturity of the coin period, which varies from project to project, the coins qualify for mining and participate in a sort of draw that will elect a certain set of coins at stake without moving all over (maturity period and delegation period) to identify and confirm the transaction, and then receive the reward, this timeframe is very varied and those with the largest number of grouped coins and the largest number of stake coin groups have the advantage over those with the least amount of coins.

Leasing Proof of Stake (LPOS)

For a fair, economical and efficient reward distribution, Waves selected a mining PoS model known as Leasing. In abstraction very similar to traditional and regular PoS with differences:

All lessors of a node will have the same reward opportunity, commensurate with their amount of currency in their node, ie, the leaser node will be mining as if it were a single set of coins with several groups of coins, and will distribute the rewards received by this node in proportion to each leaser according to the amount of coins he has allocated to this node.
There is of course the detail that the node owner determines the distribution rule and when choosing a node to lease your currencies, you need to observe if the rules satisfy your interest.

It is possible to state that what is known as shared stake is a simulation of Leasing PoS, because if a shared stake correctly distributes proportionality it follows the same concept as Leasing PoS. So you might think it's the same thing, and you're wrong, at least in Waves's LPOS application you're absolutely wrong. And I will conclude by explaining the reason for the mistake.

In a shared stake, you need to send your coins to a wallet account, that is, the custody of your coins is in the hands of third parties, and you are dependent on several issues beyond your direct reach.

With the Waves Platform LPOS you do not lose custody, or the right to manipulate them, there is no direct transfer, which there is a lock reserve, which identifies your coins to a particular chosen node to which your coins will be leased. With the Waves Platform LPOS you can lease your currencies today, and cancel your lease tomorrow, only paying fee, and immediately they will be in your wallet so you can make the use you want.

Simple, straightforward, easy, fast and mostly safe to profit from your insured Waves with 2 clicks.

Next article, waves incentives for nodes owners (with game of nodes)

 


Thiago Capuano
Thiago Capuano

Brazil Waves Ambassador


Waves Beach
Waves Beach

Blog focused exclusively on wave related platform topics.

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