...

Without restrictions:

The Byzantine Generals' Problem

Proof-of-Work
(PoW)

A math challenge that is:

• hard to solve
• trivial to verify

• Nodes have to prove their commitment, by solving the puzzle
  
   
• Reverting blocks  requires impractical amounts of resources
  
   
• Incentive to cooperate (mining fees) keeps the network healthy
  
   
• Hard to centralize control of the network (51% attack)

BTC total Hash-rate: 45,000,000 TH/s (that's 45e18)

BTC power consumption: 71.12 TW/h (~ same as Chile)

Proof-of-Stake
(PoS)

“It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.” 

Warren Buffett

Higher stakes in the network (coins owned, time spent, etc)

• Minimal energy waste compared to PoW
  
   
• Also does not solve the 51% problem
  (but it arguably reduces it)
  
   
• Introduces new challenges
  • nothing-at-stake problem
  • initial distribution
  • bribe attack
    
     
• Not 100% proven to be secure

Delegated

Proof-of-Stake
(DPoS)

“Technological Democracy” 

• Shareholders vote on Delegates
  
   
• Stake in the network determines voting power
  
   
• Delegates compete for the top spots, are rewarded for their duty, and punished for malicious behaviour
  
   
• Voting is an ongoing process

Main issue with PoW:

wastes

too much energy

Main issue with PoW:

wastes

too much energy

• Competitive nature of PoW rewards miners for increasing their Hashing Power
  
  
   
• This only drivers total energy waste upwards
  
  
   
• BTC PoW (sha256) is 100% CPU-bound
  • scales linearly with Moore's Law