Introduction
Proof-of-Stake (PoS) is the foundation of Ethereum's consensus mechanism. Ethereum transitioned to PoS in 2022, as it offers enhanced security, reduced energy consumption, and better scalability compared to its previous Proof-of-Work (PoW) architecture.
Prerequisites
To grasp this guide, first review consensus mechanisms.
What Is Proof-of-Stake (PoS)?
PoS validates transactions by requiring participants (validators) to "stake" ETH as collateral. Validators propose and attest to blocks; dishonest actions result in penalties (slashing). Key features:
- Staking: Validators lock 32 ETH in a smart contract.
- Block Validation: Validators check new blocks and occasionally propose their own.
- Slashing: Malicious acts (e.g., double-signing) destroy staked ETH.
Validators Explained
Requirements:
- 32 ETH deposit via the Deposit Contract.
Three software components:
- Execution Client
- Consensus Client
- Validator Client
Process:
- Activation Queue: New validators join a queue.
- Block Proposal: Validators are randomly selected per slot (12s) to propose blocks.
- Attestations: Committees of validators vote on block validity.
Transaction Flow on Ethereum PoS
- User Submission: A signed transaction is sent via an Ethereum node.
- Validation: Execution clients verify transaction legitimacy.
- Propagation: Valid transactions spread across the network.
- Block Creation: Selected validators bundle transactions into a block.
- Finalization: Blocks are finalized after two-thirds of validators attest to checkpoint pairs.
Finality: Achieved when a block is part of an irreversible chain (requires 66% validator agreement).
Crypto-Economic Security
- Incentives: Validators earn ETH for honest participation.
- Penalties: Slashing destroys ETH for malicious acts (e.g., equivocation).
- 51% Attack Cost: Attackers must control >51% of staked ETH, making attacks economically prohibitive.
PoS vs. PoW: Key Comparisons
| Advantages | Disadvantages |
|-----------------------------------------|---------------------------------------|
| Lower energy consumption | Less operational history than PoW |
| Reduced hardware barriers | Complex implementation |
| Stronger decentralization | Requires 32 ETH to stake |
Why Ethereum Switched:
- Energy efficiency.
- Scalability solutions (e.g., sharding).
- Economic security.
FAQs
1. Can I stake less than 32 ETH?
Yes! Use staking pools (e.g., Lido, Rocket Pool) to contribute smaller amounts.
2. What happens if a validator goes offline?
Minor penalties ("inactivity leaks") apply until reactivation.
3. How is PoS more secure than PoW?
Slashing and social recovery mechanisms deter attacks.
4. What’s the role of checkpoints?
They enable finality by tracking validator votes across epochs.