What is DigiByte? (DGB)
The Beginner’s Guide
DigiByte is a software designed to compete against major cryptocurrencies such as Bitcoin, XRP, and Litecoin by prioritizing cybersecurity and scalability.
Its platform boasts additional features enabling users to issue assets, launch applications and use digital identities. Further, its protocol is built to leverage multiple mining algorithms and enforce a monetary policy with a maximum supply of 21 billion DGB coins.
That said, users are likely to find DigiByte replicates aspects of other competing cryptocurrency networks. DigiByte’s cryptocurrency, DGB, for example, is used to pay fees to those who help operate the network, and is also intended to facilitate payments and fuel its smart contracts.
It also includes a mission statement in its blockchain.
A message embedded in the first block of the Digibyte blockchain reads: “USA Today: 10/Jan/2014, Target: Data stolen from up to 110M customers.”
For more regular updates from the DigiByte team, you can check out DigiByte's Youtube page, which includes release briefings and interviews that provide insight into its evolving network.
Who Created DigiByte?
DigiByte was launched in January 2014 by creator and founder Jared Tate.
At launch, DigiByte released 0.5% of the total supply in a giveaway. Half of these DGB coins went to early users, while the other half supported the first 18 months of its development.
DigiByte is mainly supported by three separate groups:
- Open-source developers – volunteers who contribute to the ecosystem through peer-reviews, code contribution or app development.
- The DigiByte Foundation – a non-profit organization supporting the development, research, education and marketing of the project.
- The Awareness Team – a community-driven outreach vehicle that maintains social media, marketing and press releases.
How Does DigiByte Work?
DigiByte enables many features common to cryptocurrencies, allowing users to send and receive DGB coins worldwide in irreversible and permissionless transactions.
Additionally, the network allows its software users to design decentralized applications (dapps) for customers using its custom suite of smart contracts.
To achieve its ambitious vision, the DigiByte blockchain is broken into multiple layers:
- Application Layer – The user-facing layer where anyone can access DigiByte’s dapps and interact with its cryptocurrency, DGB.
- Consensus Layer – The layer where transactions get recorded and that allows miners to manage the release of new DGB cryptocurrency.
- Network Layer – The foundational layer of the blockchain that defines the communication and operating procedures for all devices running the software.
The DigiByte Blockchain
To keep its network in sync, DigiByte uses a variation of Bitcoin’s Proof-of-Work (PoW) consensus mechanism.
Similar to most mechanisms, DigiByte’s PoW variant is used by computers running DigiByte’s software to secure the network, validate transactions and earn newly minted DGB.
In contrast to Bitcoin’s mining industry, where specialized hardware is needed to become a miner, DigiByte mining can be done through consumer grade hardware, allowing a wider audience to participate in its network.
Digiassets & Digi-ID
The DigiByte team has updated its software several times over the years.
Digibyte now enables developers to create customizable crypto assets on its blockchain, called Digiassets, which can represent anything from traditional financial assets (such as equities or gold), to legal documents (such as notarized documents or land deeds).
Digi-ID is an authentication system for applications that mitigates the need for usernames and passwords. The DigiByte team claims this ID system can share cryptographic data without revealing any personally identifiable information to applications.
Why does DGB have value?
The DGB cryptocurrency helps maintain and operate the DigiByte network.
For example, DGB is used by the network to power the dapps built on top of its blockchain, and, by owning DGB, users gain the ability to participate freely within these applications.
Further, new DGB tokens are minted each block and are used to reward participants who burn energy and add blocks of transactions to the DigiByte blockchain..
Similar to Bitcoin, DGB is a scarce asset. The number of DGB released in each block is reduced by 1% every month until the network reaches its total supply of 21 billion tokens.
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Why Should I Use DGB?
Users may find DigiByte appealing based on its attempt to create an alternative to major cryptocurrencies while implementing asset issuance and smart contracting.
Investors may also seek to buy DGB and add it to their portfolio should they believe the market will favor earlier cryptocurrency projects with an established community.
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