Delegated Proof of Stake (DPoS)

Definition - What does Delegated Proof of Stake (DPoS) mean?

Delegated proof of stake (DPoS) is a verification and consensus mechanism in the blockchain. It competes with other proof of work and proof of stake models as a way to verify transactions and promote blockchain organization.

Techopedia explains Delegated Proof of Stake (DPoS)

In a delegated proof of stake system, stakeholders build consensus according to their amount of stake in a cryptocurrency system. Experts point out that some of the values of delegated proof of stake are scalability and speed, and that an advantage is the streamlining of digital transactions. However, security and issues of inequity come up around the idea that delegated proof of stake tends to centralize decision-making in the hands of the richest few in a given cryptocurrency market. Some worry that a delegated proof of stake model will result in larger stakeholders forming cartels, which can lead to multiple types of bad market actions.

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