Decred (DCR) is an open-source cryptocurrency launched in February of 2016. Decred (short for Decentralized Credit) was created by crypto-enthusiasts concerned that Bitcoin’s decision-making was becoming too centralized due to the growth of Bitcoin mining pools. Decred describes itself as “an autonomous digital currency” with “a strong focus on community input, open governance, and sustainable funding for development.”
DCR utilizes a hybrid Proof-of-Work (PoW) and Proof-of-Stake (PoS) consensus mechanism to ensure that a small group of users can’t manipulate the flow of transactions or make sudden changes to the Decred protocol without the input of the community. With a hybrid consensus algorithm, miners earn DCR for finding new blocks while Decred token holders can validate transactions to receive rewards as well as vote on network proposals.
This allows token holders to have input in the progression of the project. Users who stake their Decred tokens receive a ticket that, when randomly selected, allow the ticket holder to act as a block validator. With Decred, 60% of the block reward goes to Proof-of-Work miners, 30% to Proof-of-Stake voters, and 10% to fund the development of the protocol. This is unlike Bitcoin where 100% of the reward goes to the PoW miners.
At the time of this writing, the development funds are in the control of Decred Holdings Group LLC and is centralized. However, the plan is to decentralize these funds via Decentralized Autonomous Organizations (DAOs). DAOs are governing entities whose actions are dictated by the stakeholders and operates via smart contracts.
Decrediton is the official wallet created by Decred developers. It is a full-node desktop client which can safely store DCR. With this wallet, users can also mine and stake their Decred coins. Decrediton employs Simple Payment Verification (SPV) technology which only downloads full blocks containing transactions relevant to the user (i.e. transactions involving the wallet’s addresses). This is a difference of downloading tens of megabytes versus multiple gigabytes of data which reduces the initial load time for new wallets. At the time of this writing, Decrediton is available for Mac, Windows, and Linux.
In September of 2017, Decred and Litecoin (LTC) completed the first successful atomic swap. An atomic swap is a peer-to-peer exchange of cryptoassets from one blockchain to another blockchain, without utilizing a third party service like an exchange. Throughout the atomic swap process, both users have full control and ownership of their private keys.
Just like Bitcoin, Decred has a max supply of 21 million tokens. 1.68 million (8 percent) Decred coins were pre-mined, half (4%) going to early developers who contributed to the project and the other half (4%) airdropped to distribute DCR to the wider crypto community.
The Decred project was founded by the Chicago-based firm, Company 0, led by Jake Yocom-Piatt (CEO). Before forking Bitcoin to create Decred, Yocom-Piatt developed btcsuite, a software for interacting with Bitcoin using Google’s programming language, Go.Read More