Decred, also known as DCR, is a cryptocurrency that was created to address the scalability problem that Bitcoin faced. A massive rift in the Bitcoin community led to the hard fork of Bitcoin and Bitcoin Cash. Decred is designed to prevent future rifts like these by allowing the community to vote on the currency’s destiny.
Because DCR is decentralized and self-governing, a hard fork can only happen if the majority of stakeholders agree to it. Decred may be able to establish a niche for itself in an increasingly competitive cryptocurrency industry thanks to its unique approach to the face hard forks. So, if you want to know more about this cryptocurrency, keep reading.
What is Decred (DCR)?
Decred (DCR) is a blockchain-based cryptocurrency that was first released in February of 2016. The Decred cryptocurrency and protocol were designed to make open governance, community participation, and long-term financing plans more accessible.
Decred was designed in such a way that all transactions and protocol modifications must be approved by the community, according to the official whitepaper. As a result, large Decred holders have no method of influencing the protocol’s functionality.
Decred was greatly influenced by Bitcoin, and many of the original cryptocurrency’s core ideas were used.
Decred is aimed to capitalize on Bitcoin’s alleged weaknesses. Specifically, Bitcoin is at risk of becoming overly centralized, and huge mining interests have too easily dominated the conversation about the blockchain’s future. One of the most challenging problems that Bitcoin has encountered in recent years is resolving the scalability issue. The Bitcoin community has seen profound rifts as a result of these frequently heated discussions. When Mike Hearn announced his departure from Bitcoin, he described the community as being in “open civil war.” This squabble finally resulted in the Bitcoin Cash fork.
Decred (DCR): roots and history
Decred was founded by Jake Yocom-Piatt, the CEO of company 0, and was launched on February 10, 2016, with a team that also included many former bitcoin developers.
There was a pre-mine that accounted for 8% of the total supply before the debut of Decred. Company 0 held 4% of this pre-mine as compensation for developers. The remaining 4% was given away to new users for free. Rather than using an ICO to fund the coin, the developers paid for it out of their own pockets at first. They had the option of purchasing DCR for $0.49 per coin or exchanging it for labor at the same rate.
How does Decred work?
Decred employs a hybrid consensus method that integrates Proof of Work and Proof of Stake. This is a one-of-a-kind technology designed to prevent miners or large stakeholders from gaining control of the network.
Decred ties everything together via Politeia, a proposal system that allows stakeholders to vote on project financing, new projects, and other modifications to the protocol’s code.
Decred (DCR), the project’s native cryptocurrency, competes with other cryptocurrencies such as Bitcoin (BTC), Dogecoin (DOGE), and Litecoin (LTC) while also allowing users to engage in governance, participate with the community, and use it to fund network enhancements.
All block rewards in Decred are subsidized by 10%. This fund will be used to pay for future network enhancements, and it is open to everyone whose ideas are accepted, and it is not something that only team members have access to.
Why choose Decred?
DCR is crucial to the upkeep and operation of the Decred network, and consensus actors get paid in DCR for contributing resources to its security.
DCR may be transmitted, received, and held. However, it can also be staked in order to vote on future project developments and participate in the consensus process.
DCR, like other cryptocurrencies, has a finite supply, which means that there will only ever be 21 million DCR, according to the software’s restrictions. It’s worth noting that DCR tokens are produced every 5 minutes, with the total quantity released falling by 1% every 21 days.