Proof of work and proof of stake are two key processes used to verify new cryptocurrency transactions to the blockchain to generate new tokens. 

Both models use a consensus mechanism which is a system that allows a network of computers to validate legitimate transactions without the need for a third party.

A proof of work is the first consensus mechanism that utilises a network of computers to solve a mathematical equation or problem to prove their work in exchange for a reward in cryptocurrency.

A proof of stake on the other hand, requires individuals or validators to contribute or stake their own cryptocurrency for the opportunity to successfully approve transactions – all participating validators receive a proportion of cryptocurrency as reward for their work.