How Does It Work?

Validators and Delegators

Delegated Proof-of-Stake consensus mechanism works using a democratic process.

To explain, the network users vote to delegate the block validation rights to delegates, also called witnesses or block producers (Validators).

There is a limit on the number of delegates chosen for each block, and it differs for each blockchain using this consensus mechanism. This means the delegates of one block might not be the delegates of the next.

To choose these delegates, users vote on them by pooling their tokens into a staking pool and linking those to a particular delegate. The delegate with the most tokens may then validate a block, and receive the corresponding transaction fees as a reward. Next, the delegate distributes the rewards to users who supported them based on each user’s stake.

It is important to note that voters maintain control over the system. So, users can also vote out delegates if they make malicious attempts on the network.

As such, delegates with a strong reputation are usually elected as witnesses.