You have probably noticed that there are many different types of consensus algorithms. These algorithms ensure that a blockchain can work properly, and everyone works according to the rules. The best-known algorithm is Proof-of-Work (PoW). A fewer, but newer algorithm is Proof of Participation.
What is Proof of Participation?
There are only a few blockchains that use Proof of Participation (PoP). It is not difficult to explain how Proof of Participation works. As the name suggests, it’s all about participation; participating in the bigger picture.
Nodes are chosen according to an algorithm to be allowed to validate blocks. So in this respect it is a bit like Proof of Stake . But the algorithm chooses the nodes in that case based on the number of points they have. And nodes can get these points by participating well in the network.
The better a node participates, and the better the work the node delivers, the more points the node gets. Then all points are added together, and based on these points, a node is given the privilege to add blocks to the blockchain.
However, it is also possible that a node is deducted points. This can be the case when a node is not doing its best. Suppose a node stops participating for a while, that can cost points. But when a node accepts transactions that should not have been accepted, it can itself lead to so much point reduction that it reaches zero.
When zero is reached, a node will be removed from the network. That means he will never be able to participate again in the future. Now you may think that he can register via another machine, but that is not possible.
Link to identity
Nodes are linked to someone’s actual identity. If you want to register yourself, you will first have to show who you are. You may therefore be asked for a copy of your identity card. In this way, Proof of Participation wants to ensure that the network remains as secure as possible.
Who uses Proof of Participation?
There are almost no blockchains that use Proof of Participation. The best-known blockchain that uses this is ZooBC. This is a blockchain and cryptocurrency that was founded by Blockchain Zoo. This is a company based in Bali (Indonesia).
The benefits of Proof of Participation?
Now that you know what Proof of Participation is, you might already be able to think of some advantages yourself. The biggest advantage is that the rewards are distributed much more fairly in the Proof of Participation algorithm. Miners are rewarded based on how well they participate. So it’s not about how strong the computer power is ( Proof of Work ), or how much money you bet (Proof of Stake).
Proof of Participation is all about being valuable to the blockchain network. When you are, you will be rewarded for this. If you’re not, you won’t get a reward, and you have the chance of getting a punishment.
This also solves the problem of scalability. Many blockchains run into the problem that they are not scalable enough. Just think about Bitcoin. Due to the consensus algorithm they use, Bitcoin is already at its limit. As a result, few people see a bright future in Bitcoin, which goes beyond its use as a means of payment.
Proof of Participation also makes attacks much more difficult. Participants must show who they really are. So it is easier to tackle fraudsters and criminals. It will also ensure that hackers do not start on blockchains with the Proof of Participation algorithm.
As a final advantage, Proof of Participation is a lot more environmentally friendly than algorithms such as PoW. Block miners are already selected in advance, so that no energy is wasted by miners who ultimately do not add a block to the blockchain.
The difference between Proof of Stake and Proof of Participation
In essence, Proof of Stake and Proof of Participation are very similar. In both algorithms, participants must use something to be allowed to validate. The difference, however, is that at Proof of Stake one must be in possession of a considerably high amount of money in order to be allowed to validate. This amount of money is used as a kind of deposit. When they do their best and do a good job, they will receive some sort of interest on the stake. But when they don’t do their job well, they can lose the stake. So that is a reason to do their best.
At Proof of Participation, their points are used. Nodes can earn points by doing their best. When nodes need to be picked to validate new blocks, it’s based on the number of points they’ve earned. The moment they don’t do a good job, they can lose these points. In this case, the points count as the deposit they use. In this way, consensus is reached within the blockchain that uses Proof of Participation.
Proof of Participation is one of many consensus algorithms. This is the algorithm that ensures that blockchain participants adhere to all the rules and are rewarded for their work. The rules of the blockchain are incorporated into the algorithm. The best-known algorithms are Proof of Work (PoW), Proof of Stake (PoS), Delegated Proof of Stake (DPoS) and Proof of Authority (PoA).
This algorithm determines who can add new blocks to the blockchain. These blocks contain all transactions made in the time since the last block. The moment a block is added to the blockchain, the transactions in the block are validated and executed.
Those who add new blocks to the blockchain are rewarded for this. The reward often consists of the transaction costs that people pay when they execute a transaction.
Thanh Lanh Tran(1989) is Chief Editor from BitcoinUSD.com