The Delegated Proof of Stake(DPoS) is a cryptocurrency consensus mechanism that was created by Daniel Laimer in 2014.
It is a variation of the Proof-of-stake consensus mechanism that was created as a better alternative to the Proof-of-work consensus just as Proof-of-stake was.
Before we go further let’s talk about some of the other cryptocurrency consensus mechanisms available.
Proof of Work
The Proof-of-work was the first consensus mechanism used on the blockchain following the fact it was first used in Bitcoin which was the first implementation of Blockchain technology.
How does it work? It is a system whereby miners have to solve complex mathematical problems using their computational power (CPU or GPU power) in order to prove to the nodes on the network that they actually validated all the transactions in a block before they can be added to the blockchain.
Then, the miners are rewarded with block rewards and the transaction fees of the transactions on the block.
As the name implies, it just a way to prove that you have done the work of validation.
Although this has proven to be the most secure and reliable and remains the standard for a fault-tolerance solution, it also has two major downsides: energy and cost.
This mechanism consumes a lot of energy and the specialized hardware for mining also costs a fortune compared to the Delegated Proof-of-Stake.
Proof of Stake
The Proof-of-stake consensus is the most popular alternative to Proof-of-Work.
While Proof-of-Work systems rely on external investments (power consumption and hardware), a Proof of Stake blockchain is secured through an internal investment (the cryptocurrency itself).
They are no miners rather there are block validators, minters, or forgers.
There is no mining in these systems and the validation of new blocks is dependent on the number of coins being staked. The more staking coins a person holds, the higher the chances of being picked as a block validator.
If a validator approves a wrong or fraudulent transaction, they are penalized by a deduction from their staked coins and vice-versa.
Delegated Proof of Stake
Haven stated that the Delegated Proof of Stake is a variation of the Proof of stake mechanism, It is a system whereby a fixed amount of delegates of about 21-101 are voted by the stakeholders of the network. The delegates get rewarded on every block added to the blockchain.
Delegates take turns in this process.
This is said to be an implementation of digital democracy. Also, it is said to have higher performance and is energy efficient.
If a wrong or fraudulent transaction is added, the delegate responsible is kicked out of the group of delegates.
A practical example of this is the Tron Blockchain. Below is a little detailed of how the Delegated Proof of Stake is implemented on the Tron Blockchain.
The TRON consensus mechanism uses an innovative Delegated Proof of Stake system in which 27 Super Representatives (SRs) produce blocks for the network. Every 6 hours, TRX account holders who freeze their accounts can vote for a selection of SR candidates, with the top 27 candidates deemed the SRs. Voters may choose SRs based on criteria such as projects sponsored by SRs to increase TRX adoption, and rewards distributed to voters. This allows for a more democratized and decentralized ecosystem. SRs’ accounts are normal accounts, but their accumulation of votes allows them to produce blocks. With the low throughput rates of Bitcoin and Ethereum due to their PoW consensus mechanism and scalability issues, TRON’s DPoS system offers an innovative mechanism resulting in 2000 TPS compared to Bitcoin’s 3 TPS and Ethereum’s 15 TPS.
The TRON protocol network generates one block every three seconds, with each block awarding 32
TRX to Super Representatives. A total of 336,384,000 TRX will be awarded annually to the 27 SRs.
Each time an SR finishes block production, rewards are sent to a sub-account in the super-ledger.
SRs can check, but not directly make use of these TRX tokens. A withdrawal can be made by each
SR once every 24 hours, transferring the rewards from the sub-account to the specified SR
The Delegated Proof of Stake is relatively new to the blockchain technology space so it would take a reasonable amount of time before it would get widespread adoption.
Judging from Tron’s implementation of this, I think it will be a great improvement to the existing blockchains.
Was this post helpful? Let me know in the comments section below.
Follow me on Twitter for more content on Blockchain Technology.