How Does Collateralization in Derivatives Act as a Security Mechanism Similar to PoS Staking?
Collateralization, particularly in Over-The-Counter (OTC) derivatives, acts as a security mechanism by requiring parties to post assets (collateral) to cover potential losses from a counterparty default. This is analogous to PoS staking, where validators must lock up coins (stake) to secure the network and face 'slashing' if they act maliciously.
Both mechanisms use a locked asset to ensure good behavior and absorb potential losses.