{"id":6504,"date":"2022-01-13T09:18:00","date_gmt":"2022-01-13T08:18:00","guid":{"rendered":"https:\/\/affidaty.io\/blog\/?p=6504"},"modified":"2023-04-20T16:48:05","modified_gmt":"2023-04-20T14:48:05","slug":"business-proof-of-stake","status":"publish","type":"post","link":"https:\/\/affidaty.io\/blog\/en\/2022\/01\/business-proof-of-stake\/","title":{"rendered":"Proof-Of-Stake: Beyond Consensus, Business Opportunities."},"content":{"rendered":"\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Currently, the bitcoin and ethereum <strong>blockchains<\/strong> use an energy-intensive process called proof-of-work (PoW) to ensure all transactions on the network are valid and the distributed record of the network is accurate. PoW, the <strong>consensus<\/strong> algorithm of btc and eth, has demonstrated over the years to be a secure and reliable protocol, with no successful attacks on the bitcoin chain, and as long as there are enough honest participants, the risk of hash power aggression will be limited to zero.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But despite PoW being secure and reliable, Satoshi Nakamoto&#8217;s algorithm seems to have lost appeal due to its energy-intensive aspects and tendency towards centralized mining pools. A common criticism of the PoW mining industry is that it encourages resource centralization and thus security providers.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A more scalable and energy-efficient system is increasingly attracting the interest of major <strong>blockchain<\/strong> development teams, such as ethereum, which is transitioning from PoW to proof-of-stake (<strong>PoS<\/strong>), a different way of ensuring <strong>blockchain<\/strong> security where investors lock their funds in exchange for rewards.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Countless <strong>PoS<\/strong> projects are, in fact, heading towards tremendous growth for their promises of energy efficiency and greater decentralization, growing both in terms of interest as new frontiers of algorithmic <strong>consensus<\/strong> and as new business opportunities.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Alongside substantial technological differences, it should be emphasized that a <strong>PoS<\/strong> network creates economic opportunities by incentivizing Stakers to contribute to its security, rewarding validators with block rewards and transaction fees.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In the <strong>PoS<\/strong> network, StakerHolders are rewarded by the sum of transaction fees and the value of network inflation, which can be thought of as the primary incentive that encourages users to leverage their cryptographic resources.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The following chart shows the top 10 Proof of Stake networks ranked by the number of unique <strong>staking<\/strong> addresses. The networks with the most exclusive <strong>staking<\/strong> addresses are ranked at the top. The ranking provides an overview of the network with the highest retail <strong>staking<\/strong> participation in the entire crypto universe.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/yH5BAEAAAAALAAAAAABAAEAAAIBRAA7\" data-src=\"https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.19.53.png\" alt=\"\" class=\"wp-image-6508 lazyload\"><noscript><img decoding=\"async\" width=\"654\" height=\"375\" src=\"https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.19.53.png\" alt=\"\" class=\"wp-image-6508\" srcset=\"https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.19.53.png 654w, https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.19.53-300x172.png 300w, https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.19.53-150x86.png 150w, https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.19.53-560x321.png 560w\" sizes=\"(max-width: 654px) 100vw, 654px\" \/><\/noscript><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Source: <a href=\"https:\/\/www.stakingrewards.com\/\">https:\/\/www.stakingrewards.com\/<\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In a <strong>PoS<\/strong> system, contention is replaced by competition to attract native cryptocurrency, where participants who wish to become network validators lock a portion of this proprietary cryptocurrency as a commitment to contribute in good faith to the <strong>consensus<\/strong> process.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This chart shows the top 10 Proof of Stake networks ranked by USD value in relation to the quantity of tokens put in stake, with the highest Stake Value indicating network security, resilience, and greater network security.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/yH5BAEAAAAALAAAAAABAAEAAAIBRAA7\" data-src=\"https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.06.png\" alt=\"\" class=\"wp-image-6507 lazyload\"><noscript><img decoding=\"async\" width=\"656\" height=\"371\" src=\"https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.06.png\" alt=\"\" class=\"wp-image-6507\" srcset=\"https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.06.png 656w, https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.06-300x170.png 300w, https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.06-150x85.png 150w, https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.06-560x317.png 560w\" sizes=\"(max-width: 656px) 100vw, 656px\" \/><\/noscript><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Source: <a href=\"https:\/\/www.stakingrewards.com\/\">https:\/\/www.stakingrewards.com\/<\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Although the total stake value provides security, <strong>staking<\/strong> has an opportunity cost: resources are locked up for a period of time and cannot be used for other purposes, such as borrowing, trading, or using tokens for DeFi.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This problem applies to most <strong>PoS<\/strong> networks that use a <strong>staking<\/strong> mechanism, but it is avoided in networks such as Cardano and Takamaka, which support a native liquid <strong>staking<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Beyond the technical aspect, it should be emphasized that these <strong>PoS<\/strong> chains open up similar business opportunities for both individuals and companies seeking to capitalize on the rewards they receive.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The yield is currently interesting not only because <strong>staking<\/strong> reduces the opportunity cost of holding crypto, but also because these pay a reward significantly more meaningful than other almost zero-interest investment assets.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For example, note the rewards for holding some crypto in a portfolio and note not only how yields vary from just over 2% to a maximum of 19% per year.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/yH5BAEAAAAALAAAAAABAAEAAAIBRAA7\" data-src=\"https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.18.png\" alt=\"\" class=\"wp-image-6506 lazyload\"><noscript><img decoding=\"async\" width=\"657\" height=\"427\" src=\"https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.18.png\" alt=\"\" class=\"wp-image-6506\" srcset=\"https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.18.png 657w, https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.18-300x195.png 300w, https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.18-150x97.png 150w, https:\/\/affidaty.io\/blog\/wp-content\/uploads\/2022\/01\/Screenshot-2023-03-14-alle-09.20.18-560x364.png 560w\" sizes=\"(max-width: 657px) 100vw, 657px\" \/><\/noscript><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Source: <a href=\"https:\/\/www.stakingrewards.com\/\">https:\/\/www.stakingrewards.com\/<\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The opportunity to use cryptographic resources to earn yield through <strong>staking<\/strong> could make these resources more attractive and help increase adoption of cryptocurrencies. It is important to remember that we are still early in this technology and it is worth noting that a new, more revolutionary <strong>consensus<\/strong> mechanism than <strong>PoS<\/strong> could be created in the future, making the current innovation irrelevant.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">However, given the years of research dedicated to <strong>consensus<\/strong> projects, it is highly unlikely to happen overnight. While all eyes are on Ethereum 2.0, which was supposed to be released in 2020, many recent <strong>blockchain<\/strong> technologies have based their <strong>consensus<\/strong> on the <strong>PoS<\/strong> algorithm, laying the foundation for a nascent industry and a new financial paradigm.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">According to estimates by JP Morgan, <strong>staking<\/strong> across all <strong>PoS<\/strong> <strong>blockchains<\/strong> currently generates $9 billion in annual revenue, but is expected to become a $40 billion business by 2025.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Only time will tell.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Mario Carlini CEO of Takamaka.io<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\" \/>\n\n\n\n<p class=\"wp-block-paragraph\">Ref.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">https:\/\/www.goldmansachs.com\/what-we-do\/consumer-and-wealth-management\/p rivate-wealth-management\/intellectual-capital-f\/beauty-is-not-in-the-eye-of-the-be holder-report.pdf&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">https:\/\/www3.weforum.org\/docs\/WEF_Getting_Started_Cryptocurrency_2021.pdf https:\/\/www.stakingrewards.com\/<br>https:\/\/www.stakingrewards.com\/&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Currently, the bitcoin and ethereum blockchains use an energy-intensive process called proof-of-work (PoW) to ensure all transactions on the network are valid and the distributed record of the network is accurate. PoW, the consensus algorithm of btc and eth, has demonstrated over the years to be a secure and reliable protocol, with no successful attacks [&hellip;]<\/p>\n","protected":false},"author":86,"featured_media":3951,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":{"subtitle":"","format":"standard","video":"","gallery":"","source_name":"","source_url":"","via_name":"","via_url":"","override_template":"0","override":[{"template":"2","single_blog_custom":"","parallax":"1","fullscreen":"0","layout":"right-sidebar","sidebar":"default-sidebar","second_sidebar":"default-sidebar","sticky_sidebar":"1","share_position":"float","share_float_style":"share-normal","show_share_counter":"1","show_view_counter":"1","show_featured":"1","show_post_meta":"1","show_post_author":"1","show_post_author_image":"1","show_post_date":"1","post_date_format":"default","post_date_format_custom":"Y\/m\/d","show_post_category":"1","show_post_reading_time":"1","post_reading_time_wpm":"300","show_zoom_button":"1","zoom_button_out_step":"2","zoom_button_in_step":"3","show_post_tag":"1","show_prev_next_post":"0","show_popup_post":"1","number_popup_post":"1","show_author_box":"1","show_post_related":"1","show_inline_post_related":"0"}],"override_image_size":"0","image_override":[{"single_post_thumbnail_size":"crop-500","single_post_gallery_size":"crop-500"}],"trending_post":"0","trending_post_position":"meta","trending_post_label":"Trending","sponsored_post":"0","sponsored_post_label":"Sponsored by","sponsored_post_name":"","sponsored_post_url":"","sponsored_post_logo_enable":"0","sponsored_post_logo":"","sponsored_post_desc":"","disable_ad":"0"},"jnews_primary_category":{"id":"","hide":""},"jnews_social_meta":{"fb_title":"","fb_description":"","fb_image":"","twitter_title":"","twitter_description":"","twitter_image":""},"footnotes":""},"categories":[601,349,525],"tags":[794,800,170,798,804,826,830,147],"coauthors":[489],"class_list":["post-6504","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","category-educational-eng","category-real-applications-en","tag-ai-eng","tag-bitcoin-en","tag-blockchain-en","tag-businesses","tag-crypto-en","tag-mining-en","tag-satoshi-nakamoto-en","tag-transaction"],"_links":{"self":[{"href":"https:\/\/affidaty.io\/blog\/wp-json\/wp\/v2\/posts\/6504","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/affidaty.io\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/affidaty.io\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/affidaty.io\/blog\/wp-json\/wp\/v2\/users\/86"}],"replies":[{"embeddable":true,"href":"https:\/\/affidaty.io\/blog\/wp-json\/wp\/v2\/comments?post=6504"}],"version-history":[{"count":0,"href":"https:\/\/affidaty.io\/blog\/wp-json\/wp\/v2\/posts\/6504\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/affidaty.io\/blog\/wp-json\/wp\/v2\/media\/3951"}],"wp:attachment":[{"href":"https:\/\/affidaty.io\/blog\/wp-json\/wp\/v2\/media?parent=6504"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/affidaty.io\/blog\/wp-json\/wp\/v2\/categories?post=6504"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/affidaty.io\/blog\/wp-json\/wp\/v2\/tags?post=6504"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/affidaty.io\/blog\/wp-json\/wp\/v2\/coauthors?post=6504"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}