Delegated Proof-of-Stake

BlockworksJun 5, 2019 ⋅ 2 min read

Written by Justin Pitts

Introduction

DPoS (Delegated Proof-of-Stake) is a consensus algorithm that allows token holders to elect delegates (witnesses, block producer) to validate transactions and achieve consensus. DPoS is a derivation of traditional Proof of Stake, which allows any token holder to be involved in the validation and consensus of any given block.

DPoS was created by Dan Larimer (previously founded EOS, Steem). DPoS has some of the same advantages that Proof-of-Stake has over Proof-Of-Work: faster transaction speeds, safeguards against miner centralization, and less electricity use. DPoS also has improved throughput compared to PoS since there are less nodes participating in transaction validation.

There are certain downsides to using DPoS including voter apathy where token holders simply do not vote. Delegates can also collaborate and form cartels, where they could act in their own self-interest. These cartels could also collude to fix prices to bribe token holders into voting for them. Furthermore, DPoS centralizes the network to a few key delegates validating transactions and making decisions.

A real world analog to DPoS would be the US governments House of Representatives, where all citizens (stakeholders) can vote for an elected representative.

Suggested Reading

Hacker Noon: Explain DPOS Like I’m 5 - Stellabelle

DPOS “Missing Whitepaper” - Dan Larimer

To find more content and up to date information check out our board on Delegated Proof-of-Stake

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Outline
  • Introduction
  • Suggested Reading