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- Cardano executive explains how their PoS protocol reduced the entry barrier for individuals to join the network and build their own tokens.
- Cardano’s Ouroboros PoS protocol efficiently handles voting and governance while offering individuals with proper security and anonymity.
An increasing number of blockchains have been adopting the Proof-of-Stake (PoS) consensus mechanisms over the Proof-of-Work (PoW). Massive reduction in energy consumption has been one of the biggest motivating factors behind it.
In its recent blog post, the Cardano team explains that the benefits of the Proof-of-Stake (PoS) consensus mechanism extend far beyond just energy consumption. Frederik Gregaard, Chief Executive Officer at the Cardano Foundation, explains that the global business community is increasingly focusing on key blockchain ethos such as “privacy, transparency, security, and trust”.
Gregaard explains the benefits of the PoS mechanism beyond environmental sustainability. He says that the core benefits of Cardano’s Proof-of-Stake lie in reducing the entry barrier of interacting with the network. Gregaard also believes that it is very easy for anyone to start running a stake pool with Cardano.
All that is required is a basic hardware setup, system operations, and some server administration skills. Thus, will some experience in operations and development, one can get started using Cardano’s native token ADA. Moreover, larger the number of node operators and developers, higher the decentralization of the Cardano PoS blockchain.
Benefits of Cardano’s PoS protocol – Ouroboros
Ourobors, Cardano’s native PoS protocol has a unique mechanism in place. It leverages an algorithm that makes it impossible to predict the block producer. This is a big contrast to the PoW mechanism wherein the first miner who solves the mathematical equation gets to validate the transactions. Gregaard explains;
It is almost impossible to ascertain which pool will produce a block and at which juncture it will do so. Consequently, PoS’s random seed influencing block producer selection makes pools operating within the system less vulnerable to attacks.
The Cardano protocol handles the entire distribution of rewards. The executive also explains the benefits of Cardano’s PoS protocol with governance and voting which can be useful to enterprises. Besides, the Cardano blockchain gives any given entity the power to produce token on the system and weigh its voting power.
At present, there are three types of voting mechanisms available on the Cardano blockchain: non-weighted voting, weighted voting, and freely moving voting. In case of non-weighted voting, everyone in the system gets only one vote.
Wieghted voting is based on how much of the token an individual holds. Similarly, the freely moving voting gives individuals the power to pass their vote to others in the system. Another form of freely mocing voting is Blind voting wherein an individual can vote anonymously without disclosing their indentity. Gregaard adds:
Cryptographic privacy solutions, including Zero-Knowledge Proofs, are setting the scene for more transparent, inclusive forms of governance for everyone involved in this space.
He further added that Cardano is proud to be at the forefront of using the PoS protocol.