Overview: Although functioning similarly to one another, Proof of Importance fixes many of the criticisms of PoS. Whereas nodes in a PoS system stake their coins in order to validate blocks, PoI systems employ myriad variables in order to be eligible to validate. Nodes who prove to have spent their coins within a 30 day period are given a higher likelihood of being chosen to validate. Furthermore, nodes who are a part of ‘clusters of activity’ have a greater likelihood as well.
Strengths: PoI mirrors many of the strengths of PoS like bearing low energy costs and preventing 51 percent attacks. However, PoI rewards nodes for moving their coins and participating in hubs of high activity. This prevents hoarding of coins and increases the circulation of wealth.
Criticisms: If a governing body owns multiple nodes, its possible to create the illusion of coin transfer. One individual could theoretically transfer coins among intricate networks of which they own every node. Like PoS systems, there is no realized cost extrinsic to the system. The value of the coins is inherent to the network itself, unlike PoW, which uses the universal value of energy.
List of Coins: NEM