The world is going digital, and the money follows suit. Digital assets are the future, and for now, the crown belongs to cryptocurrencies, Bitcoin in particular. Bitcoin is the prime cryptocurrency that made the idea work, but it is not perfect. DigiByte (DGB) attempts to improve on its model, so that people can have a secure and quick payment system. In this guide, ChangeHero is going to tell you how DigiByte achieves its goal and how it is used today.
What is DigiByte?
DigiByte (DGB) is both a blockchain and cryptocurrency used within it. Like Bitcoin it uses Proof-of-Work consensus protocol (ergo, it can be mined) and unspent transaction output (UTXO) to record transactions. Unlike Bitcoin, DigiByte is a multi-layered, multi-purpose blockchain that is focused on cybersecurity and utility as well as secure payments and communications.
History and team
DigiByte was being developed in 2013 and officially started in January 2014. Its founder and creator Jared Tate joined the Bitcoin community a year earlier, but in late 2013 undertook a project of cryptocurrency that was his vision of improved Bitcoin — that being, of course, DigiByte. Tate is still an active and prominent member of the community, but he is not responsible for running it anymore — from the very start, it has been in the hands of its community, in the spirit of decentralization.
There is no enterprise or business behind DigiByte. It is supported by developer and marketer volunteers for no pay at all. The teams that contribute to the project are:
- Core developer team;
- Core outreach and DGBAT (DigiByte Awareness Team);
- DigiByte Foundation (non-profit organization that provides support to the DGB community and promotes decentralization).
DigiByte in Numbers
Blocks in DigiByte blockchain are capped at 1 MB, like in Bitcoin, but in addition to significantly faster block time — only 15 seconds — it is able to scale thanks to SegWit implementation.
The transaction processing speed can handle 560 tx/s, which is significantly higher than the other UTXO coins.
Another major change from the Bitcoin code is in the miner reward system. Instead of slashing rewards in half every four years, DigiByte gradually decreases the miner reward by roughly 1% each month. This means that the total supply of DigiByte (21 billion coins) will be completely mined by 2035. At the time of writing, the block reward equals 594.97610454 DGB or $11.88 USD.
Layers of DigiByte
DigiByte was designed as a secure multi-purpose decentralized network. Jared Tate described it as a three-layered “Oreo”:
Blockchain: On the first level, we have protocol and communications. This is the DigiByte blockchain in its purest form, with nodes communicating with each other.
Cryptocurrency: On the second level transactions occur, and DGB comes into play.
Applications: Finally, the third level represents a secondary chain. The main structure of this level is DigiAssets.
DigiAssets is a platform for issuing assets, tokens, smart contracts to represent real-world assets from units of value to documents and pieces of media. It is a continuation of Open Assets protocol, which lets units of data not connected with DGB transactions be transferred through the blockchain.
DigiByte is unique in that regard since it uses five different mining algorithms at once, weighted equally. This technology boosts the network’s security, as well as keeps mining as decentralized as possible.
DigiByte uses MultiShield (an improved version of DigiShield), a technology that recalculates mining difficulty after every block and calibrates all five mining algorithms against each other. While it uses SHA-256, scrypt and Qubit, which are all hashing algorithms that are best solved by ASICs, the other two, Odocrypt and Skein, are ASIC-resistant. Each of them contributes equally, so DGB can be successfully mined using any algorithm out of these five.
Another issue that this technology resolves is fluctuations in hashpower caused by miners momentarily joining or leaving the network en masse. In other networks, like Dogecoin and Zcash, this has been a cause of network congestion and spikes in mining difficulty, but DigiByte was able to resolve this problem.
Roadmap and Pipeline
In the future, DigiByte is supposed to be mineable with any type of hardware. For that purpose, the community is planning to change some of the algorithms in use. Ideally, the MultiAlgo should look like this:
- ASIC algorithm;
- FPGA (Odocrypt);
- CPU (RandomX was proposed this April);
- GPU (ProgPoW implementation to replace SHA-256 is in development);
- Additional algorithm, potentially, Proof-of-Stake.
Another way in which accessibility is planned to be achieved is in optimizing memory utilization, so the core client would run even on 32-bit processors or systems with less than 4GB RAM.
What else is in the pipeline? Right now, Schnorr signatures for increased security are being considered, as well as Lightning integration, among other things. A lot of improvements are planned for DigiAssets. Among them are mobile app management and burn, and dividends are in active development.
Use Cases and Adoption
With DigiAssets, it is possible to transact not only with DGB, but using any tokenized assets, tokens and smart contracts, which can be applied in “real estate, finance, remittance, identity, point of sale, racing, trade, healthcare, supply chain, government and more”. Creating an infrastructure to build applications on top of it is already proving successful for other networks, so DigiByte sees it as a key to adoption as well.
Digi-ID is an authentication system built on top of DigiByte blockchain. It can easily replace standard usernames and passwords, as well as 2FA. All that is needed is a device with Digi-ID support to scan the QR-code and send the cryptographic signature through the blockchain. Since the data that is transferred is encrypted, no personal information is recorded on the blockchain, so this method is superbly secure.
The main chain as well can boast low fees and fast transaction times thanks to MultiAlgo and adjusting mining difficulty. It makes DGB a viable option for transacting and remittances.
Thanks to CoinGate, Coinify and Coinpayments integrations, businesses can accept DGB as a means of payment. With Kamoney and Bitbill, users can pay their utility bills with it. DGB is supported in Spend, Pungo, UQID and PolisPay debit cards.
Best Wallets for DGB
DigiByte has a few open-source wallet applications, developed by the community members: Core (desktop), Mobile (iOS and Android), Go (Chrome extension). Mobile and Go support DigiAssets as well.
Third-party wallets with DGB integration include Exodus, Coinomi, Atomic, JAXX Liberty, Guarda, Trust and Magnum Wallet. For cold storage, you might look into Trezor, Ledger, KeepKey or Opolo.
In Exodus, Magnum and Trezor Wallets, you can swap crypto to DigiByte with the help of ChangeHero integration. It’s fast, cheap and you won’t even need to close the app.
#DigiByte on Twitter
Remember when John McAfee tweeted DigiByte endorsement and the price pumped immediately, according to the replies?
According to this tweet that cites ICO Analytics, last month DGB was discussed almost as widely as Ethereum and Ripple and made the top of the currencies with most social engagement. So what are people talking about?
For one, they are expecting new arrivals and new highs in the light of the recent Bitcoin halving buzz. This is one of the most popular recent posts with #DGB at the moment:
User @jamieo451 joined the DigiByte community on Twitter, and the replies serve as the proof to his words:
In other recent news, the community is showing their gratitude to BitFinex which listed DGB back in 2014. Why now? Because in a now deleted tweet Jared Tate has criticized their business practices, with some strong phrasing. This situation will show how much power the community can have over a currency, despite what one representative might be saying, if everything ends well for them.
This Tate’s tweet, a more carefully worded follow-up to the aforementioned critique of BitFinex, has still garnered a lot of attention from the DigiByte followers. The general sentiment seems to be in favour of the exchange.
This is not just the community echo chamber, as some influencers like Eljaboom have also been tweeting about DigiByte:
“Reality check :
If you invested $10,000 in $DGB from 1 April 2020 to 6 May 2020
10,000 #DGB = 405.19% = $40,518 Clean profit.
Yet, its early stages for #DigiByte
Same goes to $VIDT
I have big fat #BoomBag from both”
As a volunteer-run project, DigiByte cannot afford marketing, so the community leans into word of mouth heavily. Another platform where the community is active, aside from Twitter, is the official subreddit.
DGB Price Performance in 2020
As pointed out by LunarCrush, social media analysts, DigiByte has consistently made the top of their AltRank, which is calculated based on the engagement on social media and price against Bitcoin. The chart above illustrates the rally that at one point took the price up almost by 1000% at one point. DigiByte apologists like Rudy Bouwman say this rally was a long time in the making, given the underlying value of DGB, but it’s more likely that a feedback loop between the rally and the discussion of it on social media took place.
At the moment of publishing, DigiByte is 35th rank by market capitalization ($252,462,569 USD). One DGB is worth $0,019214 USD. DigiByte’s ROI is a whopping +1 190,58%, and it doesn’t seem to stop, since it has shown time and time again very impressive gains even without being listed on all major exchanges.
Impressive technological advancement of an already functional blockchain has convinced many in the intrinsic value of DigiByte. These volunteers are what keeps the currency moving forward, so there you have another feedback loop between community support and DigiByte claiming more attention thanks to its tech (that is possible thanks to the community, repeating). The ChangeHero team also shares the values of utility, decentralization and accessibility. This is why we support it, meaning you can easily swap crypto currencies and DGB on our website. As always, it will be a piece of cake, quick and at a best rate at the market.
We hope you enjoyed this week’s guide!