Despite the victorious march of Bitcoin across the virtual world in the form of a quality replacement for conventional currencies, its system contains some technical errors that were not taken into account when creating, but are relevant today. The main problem of the Bitcoin system is block scaling in blockchain technology. Fortunately, besides Bitcoin, there are other digital products that meet the requirements of the modern world, and one of them is the Decred cryptocurrency (DCR).
Decred digital currency is called alternative because it is a hybrid, combining the functioning of the cryptographic proposals PoW (Proof-of-Work) and PoS (Proof-of-Stake). In simpler terms, the system has a better balance between programmers and miners than Bitcoin. One example for understanding the essence: in the Bitcoin system, miners and programmers cannot come to an agreement, since each side puts forward its proposals and requirements for improving the program code, and while they argue, the technical part of the Bitcoin system remains unchanged.
But mining in the Decred system is slightly different from mining Bitcoins, mainly because the interests of both parties are taken into account. Even before the release of Decred, the developers stated that they are trying to create a better cryptocurrency, initially devoid of scaling problems, for example.
Decred cryptocurrency appeared just two years ago, offering netizens and potential investors an almost perfect financial turnover system. Why almost? Because the developers have not yet been able to convince the participants of the uniqueness of the Decred cryptocurrency. What is this, and how to evaluate participation in the development of programmers who at one time worked on the creation of Bitcoin under the banner of the company "Company 0".
The developers who worked on the first digital phenomenon claim that the Decred system is almost identical to Bitcoin, but the main difference is the initially correct structure of the platform, that is, devoid of the problems that Bitcoin has today.
Despite the fact that the cryptocurrency is still very young, at the moment there are more than one and a half million crypto coins in circulation, and the total investment is about 180 million rubles. Is it worth starting a Decred wallet, given the above indicators of system financing? Of course its worth it, at least for the sake of experiment.
As already mentioned, the new cryptocurrency has clear advantages over the Bitcoin system, therefore it is worth considering the features of the platform in order to understand how promising this product is:
At a time when they want to increase the volume of blocks in the blockchain system, which, first of all, threatens with excessive centralization of the network, the Decred cryptocurrency offers users a completely decentralized system. Programmers argue that this parameter is extremely important, since any Decred exchange will function better than in the case of Bitcoin, which has recently shown heterogeneity in the development approaches of the basic algorithms of the system.
Calculation for all network participants. One of the important components of the Decred system is the accounting of all miners working with cryptocurrency. Even if the cryptocurrency is mined using a video card (this method was popular in the Satoshi mining process when Bitcoin was just developing), users get a good return in the form of a small amount of DCR. The system is based on the laws of accessibility, which were once followed by the digital currency Bitcoin. Mining Decred currency is quite cost-effective even with conventional computer graphics cards.
Reasonable approach to the process of improving the system. While members of the Bitcoin network hold meetings to solve platform problems, Decred has an algorithm for voting using bit flags. Such a democratic approach to changes in the system is more effective, since a clear position is built on the basis of the opinions of all network participants in relation to soft or hard forks, or other changes proposed by developers.
Schnorr program that has support for n-of-n offline circuit signatures. Decred cryptocurrency was created taking into account the experience of Bitcoin and its problems in the course of development. Decred users have access to the function of confirming the transaction through the schnorr program (standard signature algorithm) with the support of the n-of-n system, which conducts transaction signatures in offline mode, which has a positive effect on the confidentiality of transactions and the load on the blockchain.
The system also provides for a limitation of the validity period of the transaction. If the transaction is not confirmed by the miners for a long time, then it is rejected with the clarification “the transfer time limit has been reached”.
The owners of the Decred wallet were able to manually cancel the transaction, or return the money sent if the transfer was erroneous. A similar system is also supported on the Ethereum platform. The Decred system is a derivative of the Bitcoin platform, its fork, therefore all scripts, algorithms and software solutions are compatible.
The platform is built on the Golang btcsuite codebase, just like the Bitcoin system. The homogeneity of the source codes provides timely support for updates based on the principle of database compatibility of two cryptocurrency platforms: Bitcoin and Decred.
Based on the above information, we can summarize that the Decred cryptocurrency is an updated version of Bitcoin with improved technical characteristics.
After the launch of the Decred system in 2014 and during the promotional campaign launched by the developers, users were interested in the new cryptocurrency, since the arguments in defense of the system were at least worthy of attention. But the problem was that developers at the dawn of cryptocurrency development could not offer a convenient and functional program for managing transactions. The first Decred wallet had a command line, and not all network participants could use it due to the need to possess at least basic programming skills.
But the developers did not make users wait long, and a few months later they presented a web-wallet for working with Decred digital currency, created on the basis of BitPays Copay. The set of features of the wallet turned out to be standard: the owners of the online storage could send and receive virtual coins and sign transactions with multi-signatures. The security of the online wallet has been and remains at the level of the Bitcoin system.
Decred was mined by AMD GPU miner, simple in functionality, based on technology from AMD, which produces computer processors and other computing equipment. The cost of such equipment rarely exceeded $ 30. A little later, software for mining pools appeared, although there was no point in them, since every user who has a processor or video card manufactured by AMD can be engaged in mining.
The reward received by miners for finding a block is divided into three parts: exactly 60% of the reward goes to miners, since they play a primary role, 30% is given to the participants of the program for financing the shares of the system, and the remaining 10% goes to the developers. You can trade the received Decred currency only on one exchange - yobit.net.
The initial Decred block generation reward was 31 DCR. This amount was divided between the miners - about 18 DCRs, participants in the equity financing program, a little more than 9 DCRs, and the remaining 10% went to developers to maintain the system.
Another very important feature of the Decred system, which we did not mention in the list of cryptocurrency advantages, is the unique blockchain block reward adjustment system. Many people know about the problem of Bitcoin scaling, which leads to the halving of the reward for finding a block. The latest halving of the award happened quite recently, devaluing investments in cloud mining services. This affected exchanges, users and investors alike.
Decred cryptocurrency has a different system of inevitable decrease in the block generation reward. Every 6144 blocks, the reward is recalculated downward by 1%. Due to this, network participants do not feel sharp fluctuations in the exchange rate, easily adjusting to new conditions. Agree, it is much easier to adjust to a 1% decrease in income every 23 days (an approximate period of reaching 6144 blocks) than to immediately lose half of the production. After all, those Bitcoin investors who bought mining capacity before halving simply lost half of their money. This will not happen with the Decred system, since there is a unique algorithm for a gradual decrease in mining profitability.
It is clear that to launch a new cryptocurrency, investors are needed who risked investing in the development of the project. After all, someone has to buy the first digital coins. Mining Decred is the source of the emergence of cryptocurrency, but it should be the investors who are interested in the success of the campaign that should be responsible for its popularization and distribution. The example with Bitcoin clearly demonstrates how profitable, at first glance, risky investment can be. Those who bought a couple of thousand Bitcoins for a few dollars in 2009 are now millionaires.
But with the Decred cryptocurrency, things are different. Even before the launch of the system, the developers said that they were not going to attract additional funding or look for potential investors, the developers themselves would pay for the launch and primary promotion of the Decred cryptocurrency.
According to the set algorithm, when the number of mined blocks in the blockchain reached 4096 blocks, the system switched from Proof-of-Work mode (developers and primary miners) to Proof-of-Stake mode (network members with shares of the total amount of cryptocurrency and miners). The transition opened two prospects for users at once: the ability to mine digital currency using their computers, and participate in financing the shares of the system.
An interesting fact, the Decred developers decided to distribute a small batch of cryptocurrency for free to the first five thousand project participants using a method called "landing". What is this if not generosity? Thanks to this, the Decred cryptocurrency has gained even more attention. Everyone who managed to register in the system before January 18, 2016 received notifications about the free distribution of Decred cryptocurrency to their email inbox. Even if the amounts were small, even they were enough to start trading on the cryptocurrency exchange.
Skeptics call Decred another dummy, which after a while will go into eternity, leaving behind a name and an article on Wikipedia, but there are those who sincerely believe in a big and bright future for the alternative digital currency Decred.