Proof of Stake (POS) is a consensus mechanism through which blockchain becomes more energy efficient and environment friendly. Within being effective in using less energy, it lets network to maintain proper decentralisation. Staking is less resource-intensive form of validating transactions in a network and an alternative to mining. For staking people simply need to hold their coins in their wallet. In a nutshell it is a process of locking coins in order to get rewarded by the network.
POW vs POS
In a Proof of Work blockchain like Bitcoin, everyone is free to mine and hence a lot of miners try to solve a complex mathematical problem, and the miner who solves it first, adds the next block to the chain. Due to this fierce competitive nature it costs a lot of hardware resources and energy. At present the Bitcoin network consumes electricity equivalent to the amount which can light million of houses in developed countries like USA.
Here comes the POS, a more environment friendly and green solution to the mining problem. The idea here is to allow user to lock their coins (stake) and then after a fixed interval the notwork allows them to mint a new block. The chances of a user finding a new block are directly proportional to the amount of coins she is locking in her wallet. Hence, rather then everybody mining, only one person finds a blocks and a lot of energy and resources are saved.
Proof of Stake and BPC
In 2020 Backpackercoin also decided to switch it's consensus to POS as we are committed for more sustainable global development and agree on reducing the carbon footprint to lowest possible levels. The Proof of Stake also brought in a lot of network security and stability ever than before in the BPC blockchain.
We are now hashing our blocks using the X15 complex hashing algorithm with a targetd average block time of 1 minute. The POS allows only the trusted nodes in the network to mint and add new blocks to the BPC network. The commencement of Proof of Stake also brought in more scalability in the Bakcpackercoin blockchain and now we have a TPS rate of around 12 Transactions per second which can easily increased to more in future.
When it comes to minting, we also have a complicated governance model where the following factors define the chances of a validator to find and add a new block:
- His Stake (Total Number of coins he has locked)
- Time period for which he has been staking
- Total Number of coins being staked on the BPC network
To let our users take the full benefits of staking rewards we have introduced staking in our android wallet. The minimum possible staking amount is 100 BPC while it can go maximum up-to 10000 BPC and the user will get the staking reward accordingly. To make it more fair we let user also choose the time period for which they want to stake and hence we have four categories: 1 week, 30 days, 200 days and 400 days. Therefore, you can conclude staking in the Backpackercoin network happens to be more democratic and user friendly. BPC is committed to keep it's network more secure, profitable and transparent always and forever.