What Is ‘Slashing’ in PoS and How Does It Act as a Security Mechanism?
Slashing is a punitive mechanism in Proof-of-Stake (PoS) systems where a validator's staked cryptocurrency is partially or fully destroyed (burned) as a penalty for malicious or dishonest behavior, such as double-signing blocks or being offline for too long. It acts as a strong economic deterrent, raising the capital cost of an attack and aligning the validator's incentives with the network's security.
Glossar
Delegated Stake
Mechanism ⎊ Delegated stake represents a participation model within Proof-of-Stake (PoS) blockchain networks, enabling token holders to contribute to network consensus without directly operating validator nodes.
Staked Cryptocurrency
Yield ⎊ Staked cryptocurrency represents a capital deployment strategy wherein cryptocurrency assets are actively participated in network consensus mechanisms, typically Proof-of-Stake, to generate rewards; this process effectively transforms a static asset holding into an income-producing position, analogous to bond yields or dividend-paying equities.
Validator Misbehavior
Risk ⎊ Validator Misbehavior in Proof-of-Stake systems involves actions such as signing two blocks at the same height, going offline during critical consensus periods, or attempting to validate invalid transactions.
Capital Cost
Investment ⎊ Capital Cost represents the required rate of return a firm must achieve on its investments to maintain its market value, or the cost of financing its assets.
Slashing
Mechanism ⎊ Slashing is a punitive mechanism in Proof of Stake (PoS) blockchain networks designed to penalize validators who act maliciously or fail to perform their duties correctly.