𝗛𝗮𝗽𝗽𝘆 𝗙𝗨𝗗 𝗙𝗿𝗶𝗱𝗮𝘆!🎉

Every week, I dismantle some #Bitcoin FUD, so 𝘺𝘰𝘶 don’t have to.

Today’s FUD:

“𝙋𝙧𝙤𝙤𝙛 𝙤𝙛 𝙎𝙩𝙖𝙠𝙚 𝙞𝙨 𝙗𝙚𝙩𝙩𝙚𝙧 𝙩𝙝𝙖𝙣 𝙋𝙧𝙤𝙤𝙛 𝙤𝙛 𝙒𝙤𝙧𝙠.”

𝗧𝗟;𝗗𝗥:

Proof of Stake = Proof of Wealth

Proof of Work = Proof of Reality

Let’s explore👇

Proof of Work (PoW) and Proof of Stake (PoS) are two consensus mechanisms used in blockchain networks to validate and secure transactions. 𝗜𝗻 𝗣𝗼𝗪, 𝗺𝗶𝗻𝗲𝗿𝘀 𝗰𝗼𝗺𝗽𝗲𝘁𝗲 𝘁𝗼 𝗴𝘂𝗲𝘀𝘀 𝘁𝗵𝗲 𝗰𝗼𝗿𝗿𝗲𝗰𝘁 𝗮𝗻𝘀𝘄𝗲𝗿 𝘁𝗼 𝗮 𝗰𝗿𝘆𝗽𝘁𝗼𝗴𝗿𝗮𝗽𝗵𝗶𝗰 𝗳𝘂𝗻𝗰𝘁𝗶𝗼𝗻. The first miner to do this gets to add the next block to the blockchain, and is rewarded with new coins and transaction fees.

On the other hand, 𝗶𝗻 𝗣𝗼𝗦, 𝘃𝗮𝗹𝗶𝗱𝗮𝘁𝗼𝗿𝘀 𝗮𝗿𝗲 𝘀𝗲𝗹𝗲𝗰𝘁𝗲𝗱 𝗯𝗮𝘀𝗲𝗱 𝗼𝗻 𝘁𝗵𝗲 𝗻𝘂𝗺𝗯𝗲𝗿 𝗼𝗳 𝗰𝗼𝗶𝗻𝘀 𝘁𝗵𝗲𝘆 𝗵𝗼𝗹𝗱 𝗮𝗻𝗱 𝗮𝗿𝗲 𝘄𝗶𝗹𝗹𝗶𝗻𝗴 𝘁𝗼 "𝘀𝘁𝗮𝗸𝗲", or lock up as collateral. Validators are chosen to create new blocks based on the amount they staked, and they receive rewards from transaction fees.

PoW is superior to PoS because PoW provides an 𝘰𝘣𝘫𝘦𝘤𝘵𝘪𝘷𝘦 𝘢𝘯𝘥 𝘷𝘦𝘳𝘪𝘧𝘪𝘢𝘣𝘭𝘦 way to determine the valid version of the blockchain. The energy-intensive process of mining connects Bitcoin to the unalterable realities of the real world, and 𝗺𝗮𝗸𝗲𝘀 𝗿𝗲𝘄𝗿𝗶𝘁𝗶𝗻𝗴 𝘁𝗵𝗲 𝗵𝗶𝘀𝘁𝗼𝗿𝘆 𝗼𝗳 𝘁𝗿𝗮𝗻𝘀𝗮𝗰𝘁𝗶𝗼𝗻𝘀 𝗻𝗲𝗮𝗿𝗹𝘆 𝗶𝗺𝗽𝗼𝘀𝘀𝗶𝗯𝗹𝗲.

And contrary to what many environmental activists believe, PoW’s energy usage incentivizes miners to seek out the 𝘤𝘩𝘦𝘢𝘱𝘦𝘴𝘵, 𝘮𝘰𝘴𝘵 𝘳𝘦𝘯𝘦𝘸𝘢𝘣𝘭𝘦, 𝘢𝘯𝘥 𝘮𝘰𝘴𝘵 𝘳𝘦𝘭𝘪𝘢𝘣𝘭𝘦 sources of energy. This gives clean energy producers a steady source of income, and a way to expand their operations 𝘰𝘳𝘨𝘢𝘯𝘪𝘤𝘢𝘭𝘭𝘺, without resorting to asking for inflation-inducing government handouts.

In contrast, PoS relies on a consensus of whoever has the most wealth to stake, which is 𝘪𝘯𝘩𝘦𝘳𝘦𝘯𝘵𝘭𝘺 𝘴𝘶𝘣𝘫𝘦𝘤𝘵𝘪𝘷𝘦 𝘢𝘯𝘥 𝘱𝘳𝘰𝘯𝘦 𝘵𝘰 𝘮𝘢𝘯𝘪𝘱𝘶𝘭𝘢𝘵𝘪𝘰𝘯. In PoS and the legacy fiat system, 𝗺𝗼𝗿𝗲 𝘄𝗲𝗮𝗹𝘁𝗵 𝗹𝗲𝗮𝗱𝘀 𝘁𝗼 𝗺𝗼𝗿𝗲 𝗶𝗻𝗳𝗹𝘂𝗲𝗻𝗰𝗲 𝗼𝘃𝗲𝗿 𝘁𝗵𝗲 𝗻𝗲𝘁𝘄𝗼𝗿𝗸, 𝘄𝗵𝗶𝗰𝗵 𝗹𝗲𝗮𝗱𝘀 𝘁𝗼 𝗺𝗼𝗿𝗲 𝘄𝗲𝗮𝗹𝘁𝗵; in PoW, more work to secure the ledger for everyone leads to more wealth, but with real-world costs, and 𝗻𝗼 𝗮𝗱𝗱𝗶𝘁𝗶𝗼𝗻𝗮𝗹 𝗶𝗻𝗳𝗹𝘂𝗲𝗻𝗰𝗲 𝗼𝘃𝗲𝗿 𝘁𝗵𝗲 𝗻𝗲𝘁𝘄𝗼𝗿𝗸.

This greater decentralization is another reason why PoW is superior to PoS. In PoW, miners compete globally, and the distribution of mining power is spread across diverse jurisdictions. If one government restricts or bans mining, miners can simply relocate to other regions with more favorable conditions. This ensures that 𝘯𝘰 𝘴𝘪𝘯𝘨𝘭𝘦 𝘦𝘯𝘵𝘪𝘵𝘺 𝘰𝘳 𝘨𝘳𝘰𝘶𝘱 can control the network.

In PoS, however, mining becomes a feedback loop of centralization that leads to increasing power concentration, 𝗮𝘀 𝘁𝗵𝗼𝘀𝗲 𝘄𝗶𝘁𝗵 𝗺𝗼𝗿𝗲 𝗰𝗼𝗶𝗻𝘀 𝗴𝗮𝗶𝗻 𝗮 𝗹𝗮𝗿𝗴𝗲𝗿 𝘀𝘁𝗮𝗸𝗲 𝗮𝗻𝗱 𝗶𝗻𝗳𝗹𝘂𝗲𝗻𝗰𝗲 𝗼𝘃𝗲𝗿 𝘁𝗵𝗲 𝗻𝗲𝘁𝘄𝗼𝗿𝗸. This centralizing tendency is further exacerbated by the emergence of liquid staking protocols, which introduce additional counterparty risks.

To put it succinctly, 𝗣𝗼𝗪 𝗶𝘀 𝗵𝗼𝘄 𝘁𝗵𝗲 𝘂𝗻𝗶𝘃𝗲𝗿𝘀𝗲 𝗼𝗽𝗲𝗿𝗮𝘁𝗲𝘀. It’s objective, verifiable, and encourages decentralization. These characteristics make it secure, resilient, and resistant to manipulation.

𝗣𝗼𝗦 𝗶𝘀 𝗵𝗼𝘄 𝘁𝗵𝗲 𝗳𝗶𝗮𝘁 𝘀𝘆𝘀𝘁𝗲𝗺 𝗼𝗽𝗲𝗿𝗮𝘁𝗲𝘀. It’s the method of resorting to decrees, lies, and manipulations to achieve one’s ends. Far from being an upgrade to Bitcoin's PoW, 𝗣𝗼𝗦 𝗿𝗲𝗽𝗿𝗲𝘀𝗲𝗻𝘁𝘀 𝙚𝙫𝙚𝙧𝙮𝙩𝙝𝙞𝙣𝙜 𝘁𝗵𝗮𝘁 𝗕𝗶𝘁𝗰𝗼𝗶𝗻 𝘄𝗮𝘀 𝗱𝗲𝘀𝗶𝗴𝗻𝗲𝗱 𝘁𝗼 𝗳𝗶𝘅.

How was that answer?

Give this a 𝗟𝗶𝗸𝗲🤙 if you think it was good, and 𝗦𝗵𝗮𝗿𝗲🔄 it with anyone who thinks Proof of Stake is superior to Proof of Work.

And 𝗕𝗼𝗼𝗸𝗺𝗮𝗿𝗸🔖 this, so you can find it quickly when you need it.

Think you can write a better answer for this FUD?

Drop it in the 𝗖𝗼𝗺𝗺𝗲𝗻𝘁𝘀⬇️

𝟱𝟬𝟬𝟬 𝘀𝗮𝘁𝘀 𝘄𝗶𝗹𝗹 𝗴𝗼 𝘁𝗼 𝘄𝗵𝗼𝗲𝘃𝗲𝗿 𝘄𝗿𝗶𝘁𝗲𝘀 𝘁𝗵𝗲 𝗯𝗲𝘀𝘁 𝗿𝗲𝘀𝗽𝗼𝗻𝘀𝗲 𝗶𝗻 𝘁𝗵𝗲 𝗻𝗲𝘅𝘁 𝟮𝟰 𝗵𝗼𝘂𝗿𝘀!