Networks such as Bitcoin function because they have miners who are willing to leverage their computing power to process transactions and safeguard the blockchain. This process is known as Proof-of-Work (POW).
Many newer blockchains utilize a different form of achieving consensus, known as Proof-of-Stake (POS), to process transactions. POS is a much less energy-intensive process.
It works like this:
Instead of high-powered nodes processing transactions in exchange for compensation, clients on the POS blockchain or network post a percentage of their crypto holdings as a form of ‘collateral’ to achieve the same result.
Clients who ‘stake’ their crypto holdings on a POS network can earn additional assets as a reward for doing so.
Assets listed on Kraken that currently utilize a POS protocol include but are not limited to Tezos, Cosmos, Cardano and EOS.
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