How Does a Shift to Proof-of-Stake Change the Security Incentive Structure?
In Proof-of-Stake (PoS), security is maintained by validators staking their assets, rather than by miners expending computational power. The incentive structure shifts from block rewards and fees to staking rewards and transaction fees, with the added threat of 'slashing' for malicious behavior.
Security is thus tied to the value of the staked assets.
Glossar
Security Incentive
Mitigation ⎊ Security incentives, within cryptocurrency and derivatives, represent mechanisms designed to align the interests of network participants with the overall security and stability of the system.
Incentive Structure
Design ⎊ Incentive Structure defines the rules and economic rewards programmed into a protocol to encourage specific desired behaviors from users, such as providing liquidity, staking tokens, or participating in governance.
Staking Rewards
Return ⎊ Staking Rewards are the compensation issued to validators or delegators for their contribution to network security and transaction processing within a Proof of Stake system, typically paid in newly minted tokens or collected transaction fees.