An Overview of Nominated Proof of Stake (NPoS)
Nominated Proof of Stake is an innovation of a new consensus mechanism targeting better security and decentralization of blockchain networks. Developed by Polkadot, NPoS is an implementation of traditional PoS that aims to select reliable validators through the nomination by token holders.
NPoS involves token holders contributing to the security of the network through the choice of the validators whom they trust to validate transactions and create new blocks. Nominators, in return, stake tokens to back these validators and share in the rewards generated by the network. There are checks and balances inbuilt in the system as nominators will be keen on choosing honest and competent validators.
The most prominent advantages of NPoS are its intrinsic values of decentralization and security. By distributing the responsibility for selecting validators to a large base of nominators, NPoS reduces centralization that can occur with other types of PoS systems. In addition, the nomination process incentivizes validators to behave in ways that are in the best interest of the network because their reputation and earnings are at stake if the nominators’ trust is lost.
Nominated Proof of Stake is a very secure and robust consensus mechanism backing the scalability and strength of modern blockchain networks.
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