Proof of stake is a method a blockchain uses to choose who creates the next BlockBlockA batch of transactions added to a blockchain in one go, together with a reference to the block before it.. Instead of competing with computing power, as in proof of workProof of workA consensus method where the right to add the next block to a blockchain goes to whoever first solves a hard computing puzzle., participants lock up their own crypto as a stake. They are called validatorsValidatorA participant on a proof-of-stake network who locks up their own crypto as a stake to create and check blocks in return for rewards..
How does it work?
On the EthereumEthereumAn open blockchain that can run applications and smart contracts, with its own cryptocurrency called ether (ETH). network, each validator has to stake 32 ETH. Every 12 seconds, one validator is chosen at random to propose a block, and other validators vote on whether it is valid. They are rewarded in Ether (ETH)Ether (ETH)The currency of the Ethereum network, used to pay network fees, as a stake under proof of stake and to send value between people. for this work.
If a validator tries to cheat, for example by proposing two different blocks for the same slot, part of the stake is taken away. This is called slashingSlashingA penalty on proof-of-stake networks. A validator that breaks the rules loses part of its stake and is removed from the network.. Validators who are offline when it is their turn earn less.
It works much like a rental deposit. If nothing goes wrong, you get it back, but if there is damage, the deposit covers it.
Proof of stake and proof of work
Ethereum switched from proof of work to proof of stake on 15 September 2022, cutting the network's energy use by about 99.95%. Many other cryptocurrencies also use proof of stake, such as Solana and Cardano.
Critics point out that under proof of stake, those who own the most also earn the most, and that large StakingStakingLocking up crypto on a proof-of-stake network to help confirm transactions, in return for rewards paid in the same crypto. services can concentrate power in a few hands.
Everything in Myntkaup Learn is written and regularly reviewed by the Myntkaup editorial team. It is for education and is not investment advice. Editorial policy. Updated 18 October 2026.