Several other large blockchains are already running a proof-of-stake consensus, including Tezos, Algorand and Qtum.
Tezos runs a staking program under its “Liquid Proof-of-Stake” algorithm, a hybrid between pure PoS and delegated proof-of-stake, or DPoS. Validating blocks in the Tezos network is known as “baking.” Anyone holding the Tezos (XTZ) token can delegate their tokens to a validator to “bake” on their behalf. However, the original owner retains their tokens in their own wallet. Anyone can participate as a baker if they hold 8,000 or more XTZ tokens, called a “roll,” and operate a validator node. The rate of return for staking on Tezos is currently around 7%.
Algorand operates a consensus protocol called “pure proof-of-stake.” It uses a system called “secret self-selection” to choose randomly selected committees of stakeholders that will validate each block. What makes Algorand different is that all Algo token holders are rewarded simply for holding their tokens, regardless of whether or not they choose to participate in the PoS program and validate blocks. Therefore, there’s no minimum stake for earning rewards with Algorand. The current rate of return for holding Algorand tokens is around 5%.
Similarly, Qtum also runs on a pure PoS consensus, where anyone with even a fraction of a Qtum token can become a validator and compete for block rewards. The project has implemented a native application, making it easier for everyday users to participate in its staking program, and there is also a command-line option for more technical users. Staking on Qtum provides a return of around 7% per year. There is no minimum stake, but holding more tokens increases the chances of being selected to validate and process transactions in the network.
Joseph Spezzano received a Masters Degree in computer science from The University of Massachusetts. Joseph has been working as a full-time blockchain programmer for the past 5 years. In his spare time, Joseph enjoys writing for CryptocurrencyInvestments.com and traveling.