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The Skinny on 'The Merge' / News of the Money-World #47

NZ Everyday Investor

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Proof of Work and Proof of Stake

Proof of work is based on a competition between miners who compete using processing power to validate transactions. Proof of stake secures the network instead, with a commitment to the network's native token. In etherium, if you try to cheat the network or publish a false transaction, your stak gets smashed. But it has really dramatic impact on the power usage because you don't have these racks and racks of miners running 24 seven in warehouses.

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