proof of stake (pos) is a type of consensus algorithm by which a cryptocurrency blockchain network aims to achieve distributed consensus. in pos-based cryptocurrencies the creator of the next block is chosen via various combinations of random selection and wealth or age ("i.e.," the stake). in contrast, the algorithm of proof-of-work-based cryptocurrencies such as bitcoin uses mining; that is, the solving of computationally intensive puzzles to validate transactions and create new blocks.