What is Decred?
Decred is a cryptocurrency based on Bitcoin’s source code (with some modifications) to regulate and reward users who contribute in the blockchain development, and to participate in users’ decisions and changes in the blockchain.
It works as a hybrid consensus mechanism of Proof-of-Work and Proof-of-Stake to achieve a perfect balance: miners (using Proof-of-Work) verify transactions and users (using Proof-of-Stake) propose and vote on network improvements.
How does Decred (DCR) work?
Decred uses a single hybrid Proof-of-Work and Proof-of-Stake to verify available blocks. Consequently, stakeholders or coin holders give permissions to coin miners who build blocks for rewards. This is a unique system because it ensures that miners are not just here for the short-term return on their investment.
There are also three additional points to consider when describing the Decred process:
Decred’s hybrid Proof-of-Work (PoW) - Proof-of-Stake (PoS) consensus mechanism makes it significantly more costly to attack than other PoW or PoS consensus chains.
The governance model adopted by Decred allows proposals to be reviewed and implemented quickly and fairly. In addition, Decred’s governance systems make it easier for the Decred blockchain ecosystem to evolve and adapt in line with the tides of the blockchain industry. In addition, these systems make Decred resilient to bifurcations, making it easier to integrate new features in the future.
The Decred ecosystem is focused on long-term goals and sustainable growth. The project has taken a strong stance on decentralization from day one. This is evidenced by the self-funding solution Decred has created to minimize the disadvantages often associated with traditional crypto project funding issues. This means that 10% of all blockchain rewards generated on Decred’s blockchain are distributed to a treasury created for the future development of the project.
History of Decred
In April 2013, a cryptocurrency known as Memcoin2 was proposed on the Bitcointalk forum. A user named “tacotime” suggested forming a new cryptocurrency. This opinion was shared by other Bitcointalk users named “ingsoc” and Jake Yocom-Pyatt.
The trio formulated a plan to develop a hybrid Proof of Work (PoW) and Proof of Stake (PoS) consensus mechanism for Memcoin2. The result was an entirely new project, Decred. The result is a highly secure and fair hybrid PoW / PoS consensus mechanism built using the btcsuite code base, a variant of the Bitcoin codebase. Decred, however, is not a fork of Bitcoin. Rather, it is a sovereign blockchain and an independent cryptocurrency.
Work on Decred began in February 2014, with the main network launched in February 2016. This was achieved with the help of airdrop and a small preliminary video to launch the Proof-of-Stake (PoS) and rewarding the first contributors. Thus, the project began and continues to be a transparent and highly decentralized network.
The principles on which Decred is based
We’ve already said that Decred is united and governed by a number of principles that seek to ensure that technology truly benefits society. These are as follows:
- Free and Open Source Software: all software developed under Decred must be free and open source.
- Freedom of expression and opinion: everyone has the right to express their opinions and ideas without fear of censorship. Also, any constructive ideas based on facts and reasons should be considered.
- Multi-stakeholder involvement: inclusion is a multi-stakeholder system, and active efforts should be made to include a diverse set of viewpoints and users. While it would be ideal to include everyone, Decred will comply with all relevant legal authorities in jurisdictions where applicable, such as embargoes and other trade sanctions.
- Additional Privacy and Security: at Decred, privacy and security are priorities and must be balanced in their implementation. Privacy and security technologies must be implemented continuously and incrementally, both proactively and on-demand in response to attacks.
- Universal interoperability: this aspect is fundamental to Decred as it strives to be a valuable safe haven and to ensure that the attacks it receives are actively monitored, with follow-up countermeasures as needed.
The DCR team.
Decred had a humble beginning, as it began as a sequel published in April 2013 by Adam McKenzie. It was later picked up, developed, and released by Decred’s current project leader and CEO, Jake Yacom-Pia, in March 2014.
Over the years he has added many other members to his team, with Dave Collins as the lead developer. The team is fully focused and committed to making Decred the first autonomous decentralized organization in history.
What problem Decred is trying to solve?
Decred’s developers are cryptocurrency enthusiasts and early adopters of Bitcoin, but they have noticed inefficiencies in the way Bitcoin works. As Bitcoin mining operations have grown, the Bitcoin decision-making process has become more centralized, and the major mining companies have more power over the Bitcoin improvement process. In addition, while some Bitcoin improvements can be implemented with a softfork, almost all improvements that involve significant changes to Bitcoin software require a hardfork of the old blockchain.
This was demonstrated in 2017 with the proposed secure fork of SegWit2x on the Bitcoin blockchain. Debate raged, and the community was shocked at the future of the network. Ultimately, the hardfork was canceled because it did not get enough support from miners, institutional users, and exchanges. According to Decred, the kind of power that miners and institutional users had over the blockchain update was counterproductive.
In the event that the community does not agree to the fork, independent factions could also create their own open-source hardforks of the Bitcoin blockchain. We have already seen this with Bitcoin Cash, Bitcoin Gold, and Bitcoin Diamond. These offshoots implement different improvements in different ways and at different speeds, disrupting the Bitcoin community every time a consensus on an improvement is not reached.
Lightning network for instant transactions
Decred is also planning to implement the Lightning Network. This is an improvement that various cryptocurrencies, including bitcoin, have explored. Essentially, the Lightning Network works off the blockchain to calculate payments and reduce network requirements and processing speed. It takes two users who regularly do business to set up a third account, which is a locked box in which everyone puts the same amount of money. When two users want to make a transaction with each other, they simply send each other bills of exchange, changing the balance of funds in the drawer.
Where to buy a DCR coin?
Decred can be bought in a variety of exchanges, including the majors like Binance or HitBTC. You can also buy or exchange DCR right in the Guarda Wallet. To do this, you need to log in to the Wallet account and find the DCR wallet in the list of wallets.
Where to store Decred crypto?
Decred can be stored in different crypto wallets. You can choose the most suitable for you among standalone wallets and those integrated into exchanges.
Try a non-custodial Guarda Wallet to keep your DCR. It is safe, easy to use, and reliable.
Decred’s greatest strength is its community. The founding development team consists of former developers of major crypto projects, particularly the developers of btcsuite, a version of Bitcoin written in the Go programming language. Btcsuite’s open-source Go code has been used in other projects.
If the team can create great features that extend Decred in a way that makes it more useful to community members, adoption of Decred will continue to grow because good governance leads to good decisions. However, if the Decred community does not participate or organize rapid development, Decred could quickly be superseded by exciting new cryptocurrencies that offer better off-the-shelf features.