In a sense, it's an alternate form of Proof-of-Stake. As Section 8.4 explains, the conventional wisdom is that Proof-of-Stake's flaw is that it's circular. We've proved that actually it's not circular enough, i.e., the stakes it assigns are different than the stakes in society's existing monetary game.
Proof-of-Balance allows "stakes" (what we call "weight") to be issued in proportion to monetary balances. Once those stakes are in users' hands, the protocol can run using the algorithms designed for PoS, including all of their reward and governance mechanisms.
It turns out that to fully unleash the power of those algorithms, you need a verifiably secure stake-distribution mechanism. That's what we've invented. (It's harder than it sounds, of course...)
Comments
Thanks for the kind words.
In a sense, it's an alternate form of Proof-of-Stake. As Section 8.4 explains, the conventional wisdom is that Proof-of-Stake's flaw is that it's circular. We've proved that actually it's not circular enough, i.e., the stakes it assigns are different than the stakes in society's existing monetary game.
Proof-of-Balance allows "stakes" (what we call "weight") to be issued in proportion to monetary balances. Once those stakes are in users' hands, the protocol can run using the algorithms designed for PoS, including all of their reward and governance mechanisms.
It turns out that to fully unleash the power of those algorithms, you need a verifiably secure stake-distribution mechanism. That's what we've invented. (It's harder than it sounds, of course...)