Nominated Proof of Stake

Nominated Proof of Stake (NPoS) is a consensus mechanism used in blockchains that combines the features of Proof of Stake (PoS) with an element of nomination. This consensus model aims to encourage honest and efficient operation of nodes in the network and punish dishonest actions.
Nominated Proof of Stake is based on the general principles of Proof of Stake, where the process of creating new blocks and verifying transactions is not based on energy consumption, as in Proof of Work (PoW), but on the number of tokens held. The more tokens a node has, the more likely it is to be selected to create a new block.
Nomination:
The NPoS model adds an element of nomination, which means that token holders (stakers) have the opportunity to nominate specific nodes that they consider trustworthy and effective. Nominating nodes is done by placing stakes on their ability to operate honestly and effectively in the network.
Incentives for Good Behavior:
The NPoS mechanism puts a premium on incentives for good behavior by rewarding nodes that are active, honest and contribute to the proper functioning of the network. Nodes that are nominated receive support from stakers, which increases their chances of creating new blocks and earning rewards.
Penalties for Bad Behavior:
Nodes may be penalized if they act dishonestly or create blocks incorrectly. These penalties can include the loss of a portion of the stakes (tokens) deposited as a guarantee for honest action. This acts as a disciplinary mechanism and protects the network from potential abuse.
Nominators and Nodes Nominated:
Nodes can be nominated by token holders, called nominators. In theory, the more nominations a node receives, the more trusted its position in the network.
Decentralization and Attack Resilience:
NPoS, by encouraging token distribution and community involvement in the nomination process, promotes decentralization. This makes the network more resilient to attacks, as nodes are dispersed and supported by different interest groups.
Sustainability:
The NPoS model emphasizes sustainability, as penalties for bad behavior and rewards for good behavior help maintain balance and stability in the network.
In short, Nominated Proof of Stake is an attempt to combine the benefits of Proof of Stake with an element of social trust and accountability. It works on the basis of incentives and penalties to promote the fair, efficient and secure operation of the blockchain network.