Proof of Work (PoW) and Proof of Stake (PoS) are two ways for a blockchain to agree on which transactions are valid without a central authority. In PoW, as used by Bitcoin, miners spend computing power and electricity on a hashing puzzle, and the chain with the most work wins. In PoS, as used by Ethereum since 15 September 2022, validators lock up coins as collateral. They are chosen at random to propose and vote on blocks, and they lose part of that collateral if they cheat. Both systems make attacks expensive. PoW pays for security with energy. PoS pays for it with capital that can be destroyed.
The short comparison
| Proof of Work | Proof of Stake (Ethereum) | |
|---|---|---|
| What secures the chain | Computing power (hash rate) and the electricity behind it | Staked ETH held as collateral |
| Who adds blocks | Miners who find a valid hash | A validator picked at random for each 12-second slot |
| Entry requirement | Mining hardware and power | 32 ETH to run your own validator |
| Penalty for cheating | Wasted energy and hardware cost | Slashing: part or all of the stake is destroyed |
| Attack threshold | Over 50% of mining power | 51% of staked ETH to control fork choice; reverting a finalised block costs at least one-third of all staked ETH |
| Energy use | High | Ethereum's switch cut energy use by about 99.95% (ethereum.org) |
How Proof of Work works
Satoshi Nakamoto's Bitcoin whitepaper (31 October 2008) describes the idea in one line: "Proof-of-work is essentially one-CPU-one-vote." Miners repeatedly hash a candidate block until the result falls below a target. A lower target means fewer valid hashes, so the puzzle is harder. Nodes treat the chain with the most accumulated work as the valid one. The system stays secure "if a majority of CPU power is controlled by honest nodes."
Difficulty and block timing
The whitepaper sets difficulty with "a moving average targeting an average number of blocks per hour". The Bitcoin developer documentation describes how this works. Every 2,016 blocks, the network compares the time those blocks actually took with the ideal of 1,209,600 seconds (two weeks) and adjusts the target. Two weeks divided by 2,016 blocks is one block every 10 minutes on average.
How miners are paid
The first transaction in every Bitcoin block is the generation transaction. It collects the block reward: the newly issued subsidy plus the fees from the block's transactions. The subsidy halves every 210,000 blocks. At block 840,000, on 20 April 2024, it fell from 6.25 to 3.125 BTC, and the next cut, to 1.5625 BTC, is due at block 1,050,000. Total supply stays slightly below 21 million BTC.
The trade-off
The cost of attacking PoW is the cost of controlling the majority of hash power. To consistently produce malicious but valid blocks, an attacker would need more than 51% of the network's mining power (ethereum.org). The same work that keeps the chain secure also uses a lot of energy. ethereum.org cites Digiconomist's estimate that Ethereum miners used about 70 TWh a year shortly before the switch, as of 18 July 2022.
How Proof of Stake works
The first coin to use proof of stake was Peercoin, then called PPCoin. Its paper is dated 19 August 2012 and lists Sunny King, a pseudonym, and Scott Nadal as authors. It was a hybrid: proof of work issued the coins, and proof of stake did most of the work of securing the network. Ethereum is the largest network running on PoS today. Its rules are described below.
Validators, slots and epochs
To run a validator, a user deposits 32 ETH into the deposit contract. Time is divided into 12-second slots, and 32 slots make an epoch, so one epoch is 6.4 minutes. In each slot, one validator is selected at random (using RANDAO) to propose a block. Other validators attest that the block is valid.
Finality
The first block of each epoch is a checkpoint. A pair of checkpoints becomes justified, and then finalised, once it gets votes representing at least two-thirds of all staked ETH. This mechanism is called Casper-FFG. A finalised block cannot be reverted unless an attacker accepts losing at least one-third of all staked ETH. PoW has no equivalent: a Bitcoin transaction only becomes less likely to be reversed as more blocks are built on top of it.
Slashing and penalties
A validator that proposes two blocks in one slot, or signs contradictory attestations, is slashed. It pays an immediate penalty of 1/4096 of its effective balance, up to 0.5 ETH, and is forced to exit. A further correlation penalty is applied on day 18, and the validator is ejected on day 36. The correlation penalty depends on how many validators are slashed around the same time. For a single validator acting alone it can be under 0.1%. In a mass slashing event it can reach 100% of the stake.
Weak subjectivity
PoS has a weakness PoW does not. A new node cannot tell from the chain alone which history is genuine, because validators who have already withdrawn could build a competing fork. Ethereum handles this with weak subjectivity: a new node starts from a recent checkpoint the community agrees on and verifies everything after it. Blocks before a checkpoint cannot be changed, so long-range attacks fail.
From the first proof of work to Pectra
Which dated changes made Proof of Work and Proof of Stake what they are on Bitcoin and Ethereum today?
- 31 October 2008Bitcoin whitepaper describes Proof of Workdone
Satoshi Nakamoto's whitepaper calls proof of work "essentially one-CPU-one-vote". The chain with the most accumulated work is the valid one.
- 19 August 2012Peercoin paper: the first proof-of-stake coindone
The paper by Sunny King and Scott Nadal describes a hybrid design. Proof of work issued the coins, and proof of stake did most of the work of securing the network.
- 1 December 2020Ethereum's Beacon Chain startsdone
The Beacon Chain that runs Ethereum's proof of stake began running separately from the proof-of-work chain.
- 15 September 2022The Merge: Ethereum switches to Proof of Stakedone
Ethereum moved from mining to validators who stake 32 ETH. ethereum.org puts the drop in energy use at about 99.95%.
- 20 April 2024Bitcoin halving at block 840,000done
The block subsidy paid to Bitcoin miners fell from 6.25 to 3.125 BTC. The subsidy halves every 210,000 blocks.
- 7 May 2025Pectra raises Ethereum's validator balance capdone
EIP-7251 raised the balance a validator can earn rewards on from 32 ETH to 2,048 ETH for validators that opt in with 0x02 credentials. The minimum to run a validator is still 32 ETH.
- Block 1,050,000Next Bitcoin halvingexpected
The subsidy is due to fall from 3.125 to 1.5625 BTC. It is set by block height, not by a calendar date.
This shows only the Bitcoin and Ethereum milestones the article dates. It leaves out other proof-of-work and proof-of-stake chains, and it does not estimate when block 1,050,000 will arrive.
The newest change: larger validators on Ethereum
The most recent major change to Ethereum's staking rules came with the Pectra upgrade, which went live at epoch 364032 on 7 May 2025 at 10:05:11 UTC (Ethereum Foundation blog). Its EIP-7251 raised the balance a validator can earn rewards on from 32 ETH to 2,048 ETH. Validators opt in by switching to compounding withdrawal credentials, which begin with 0x02. Rewards above 32 ETH are then restaked automatically. The minimum to run a validator is still 32 ETH.
Energy: the clearest difference
The Merge, Ethereum's switch from PoW to PoS, took place on 15 September 2022. The Beacon Chain that runs PoS had been running separately since 1 December 2020. ethereum.org puts the resulting drop in energy use at about 99.95%. The Crypto Carbon Ratings Institute (CCRI), quoted on ethereum.org's energy page, estimates that it cut annualised electricity use by more than 99.988%, to about 2,601 MWh (0.0026 TWh) a year. The two pre-Merge estimates cited by ethereum.org use different methods: about 70 TWh a year (Digiconomist) and about 21 TWh a year (Cambridge index). Treat the starting figure as approximate.
What this means for you
- Taking part in PoW means buying specialised mining hardware and paying for electricity. Your share of rewards depends on your share of the total hash rate. Learn more in What is Bitcoin Mining?
- Taking part in PoS on Ethereum means staking 32 ETH or more and running a validator that stays online. If it misbehaves, the stake can be slashed. See What Is Crypto Staking?
- When is a payment final? On Bitcoin, a payment becomes harder to reverse with every block added after it. On Ethereum, it is final once its checkpoint is finalised.
- Neither design is safe from a majority attacker. They differ in what the attacker has to give up: hardware and energy in PoW, staked coins that can be destroyed in PoS.
Limitations: this covers Bitcoin's and Ethereum's designs as documented in October 2026; other PoW and PoS chains use different parameters.
