DigiByte is a cryptocurrency which its creator Jared Tate envisioned as a more secure, decentralized and faster variant of Bitcoin back in 2014.
|Market Cap||Volume 24h||Circulating Supply||Maximum Supply|
|$870,985,412||$23,821,409.44||14426215515.0 DGB||21000000000.0 DGB|
Since its launch, DigiByte developed an ecosystem designed to counter what its creators saw as the major challenges facing mainstream and better-known cryptocurrencies such as Bitcoin. With its DigiByte token (DGB) and a decentralized public blockchain focused on speed and security, DigiByte hopes to outperform its competitors by tackling the following issues:
1. DigiByte wants to be your faster-than-average network. DigiByte is described as having the fastest block generation speed of all public UTXO blockchains (Bitcoin, Litecoin) in operation today. In addition to this, it boasts early SegWit (Segregated Witness) implementation and calculated limiting of the scope and size of transactions in order to maintain their efficiency and processing capacity.
2. Security should not be the Achilles heel of the crypto world. DigiByte team believes that its blockchain implementation is capable of plugging the majority of potential security-related leaks thanks to its global- level decentralization involving more than 200,000 computers, phones, nodes and servers. In addition to this, Digibyte also implemented its pioneering DigiShield and MultiShield technologies to manage the difficulty stability and protect itself from recurring malicious attacks.
3. Blockchain implementation needs to be more forward-thinking in its application. At DigiByte, this issue is approached by keeping an eye on three key technologies that have developed in parallel with the blockchain: cybersecurity, the Internet of Things (IoT) and Artificial Intelligence (AI). DigiByte hopes to extend its innovations in security to IoT devices and combine its blockchain tech with AI in order to deliver more in the field of data analytics, cyber security and automation.
How Does Digibyte’s Layered Architecture Work?
Over the course of its 4-year development, DigiByte’s blockchain turned into one of the oldest and largest UTXO networks of this type in existence today. Since its community numbers some 100,000 nodes from all corners of the globe, DigiByte focused its architecture development on decentralization, scalability, payment security and speed. In order to achieve this, DigiByte features distinctive architecture which is divided into three individual layers laid up on top of one another:
- Core Protocol Layer as the Prime Mover. This is the underlying protocol for the entirety of the DigiByte’s infrastructure. With its place at the “bottom” of the layered structure, it manages communication and basic data transfer between the nodes and handles all operations taking place on the blockchain. Despite acting as the “central” layer for others above it, this component plays a key role in the DigiByte’s effort to ensure decentralization for the thousands of users running its software across the globe. All of these nodes use this layer to relay and process blockchain-based transactions.
Digital Asset and Public Ledger Layer as the Security and Administrative Hub. This layer is the “treasure trove” of the DigiByte blockchain, with all the data on the network being stored here. At the same time, the same layer hosts the security mechanism that prevents meddling with the data and provides incentives for the DigiByte miners.
It is also a home of the DigiBytes digital assets which are defined as digital “representations” of larger data, or units that stand for the things of value in the blockchain. Since these assets cannot be counterfeited, duplicated or destroyed they are suitable to represent and secure digitized valuables, such as currencies, confidential data, property ownership documents and others. All transactions with the DigiBytes are recorded on the immutable public ledger which is also hosted on this layer. New DigiBytes are created by mining and the DigiByte team plans to make them fully tradable for goods and services offered by merchants who adopt their solution. DigiBytes can be securely stored, sent or received with the help ofDigiByte wallets that give users full control of their assets without the need for third-party intermediaries.
- Application Layer as the Front of the DigiByte Architecture. The topmost layer of the DigiByte’s architecture is the one the users interact with in the “visible” manner. This is the home to DigiByte’s interface, transaction platform and APIs, organized like the app-stores most of the users are familiar with. Once fully implemented, it will also host both DAPPS (Decentralized Apps) and centralized applications (called Digi-Apps) which are to be developed on the DigiByte blockchain. Finally, this layer is where the one will find all smart contacts which are to be created and entered into on the DigiByte platform.
Can DigiByte Really Offer Faster and Cheaper Transactions?
With this architecture in place, DigiByte hopes to eventually pose a challenge to the dominant payment processing players such as PayPal and Western Union that process about one million transactions on daily basis. To get at least close to this goal in the long run, DigiByte brought the block generation speed on its network to having one block created every 15-18 seconds. At the same time, the transactions on the DigiByte platform can be verified within the interval of 1-3 seconds. Based on this, the DGB team claims that its cryptocurrency is approximately 40x faster than Bitcoin at the moment. This is translated to having the DigiByte blockchain process about 560 transactions per second, bringing it closer to its general goal of processing 2000 transaction per second as Visa does, for example. This is to be eventually achieved by doubling the block generation time every two years after the start of the project.
DigiByte also wants to beat its competitors by establishing the fee pricing plan that is supposed to bring down the transaction costs for end users and businesses to the lowest level possible (approximately USD$0.0003 per transaction). The transaction system relies on the payment of minimum fees to the miners each time a user sends a single byte as a part of the transaction. Each of these transactions can include varying amounts of bytes (from anywhere between 300 to 1000 bytes), with each of them going to the “mempool” from which the miners can choose to include them in their blocks. The users do not want to pay too high a fee for everyday transactions, yet setting the fees too low puts them in danger of having their transaction unsent.
To keep their prices low, DigiByte wants to include all transactions in the mempool for each block and this is made possible by the processing capacity of its blockchain. With DigiByte, a user pays an approximate equivalent of 80–100 “Satoshis” per byte of data (one Satoshi being 0.00000001 of a DigiByte) for each transaction. The DigiByte proponents describe this as a rather affordable fee which, as such, is highly suitable for making frequent transactions. As a consequence, DigiByte also created the DigiCafe as its point-of-sale payment app which is focused on mobile phones and built for daily micropayments on this platform.
How Does DigiByte Approach Scalability?
The DigiByte team is aware that faster block generation times can create issues with scalability, meaning that individual nodes can have trouble verifying transactions if they have to keep track of entire blockchain history, particularly with the rising number of users.
Considering that DigiByte is used in more than 80 countries and that its blockchain is arguably the longest in the world, DigiByte had to implement certain technologies to respond to the scalability challenge. The first one was the SegWit protocol upgrade. It allows for the effective separation of the transaction verification and information on the transaction in blocks. The result is a more compact ledger and the ability to implement single confirmation and cross-chain transactions on the blockchain.
DigiByte is also the cryptocurrency running the UTXO which, theoretically, improves the parallel transaction processing and incentivizes innovations relating to scalability. DigiByte also opted for limiting the size and scope of its transaction in order to make them more resource-efficient and increase its throughput. This is known as “Blockchain Rigidity”.
Bearing this goal in mind, the team opted for the creation of 21 billion DigiByte coins, which are supposed to be mined in the interval of 21 years. The developers also wanted to make the use of DGB easier to grasp for the users who want to make everyday payments with it. Thus, it features a decimal system in which each DigiByte is divisible to 8 decimal places in order to have its prices look more like “40 DGB” compared to, for example, “0.004 DGB”.
How Does DigiByte Prioritize Security?
The DigiByte team often refers to the security in the crypto world as something by which they want their platform to set itself apart from the competitors. This is to be achieved primarily through:
- Mining decentralization
- Security-first approach
Mining decentralization is part of the DigiByte’s understanding that decentralizing transactions and blockchain distribution on its platform will arguably make it more secure in the long run. Upon its launch, DigiByte used a single Proof of Work (PoW) mechanism, followed by the fork which introduced five secure PoW algorithms in total. These are SHA256, SCrypt, Groestl, Skein and Qubit. The choice of algorithm depends on which hardware is preferred for mining by the user, be it a graphics processing unit (GPU) or an ASIC system. Mining is evenly distributed between 5 algorithms, with each of them contributing 20% of the total capacity.
The SHA-256 and Scrypt algorithms are largely used by ASIC miners, precluding them from becoming the primary choice for any type of home-based mining effort. Qubit allows for the combination of hardware types, being most suitable for more advanced miners. Finally, Groestl and Skein are focused on GPU-based mining. The decentralization the DigiByte aims for is achieved by dividing the pool of miners into smaller units with equal power. With the large number of nodes the DigiByte maintains, this approach arguably strikes the balance between the need to keep the system operational while maintaining competitive and “democratized” mining.
MultiShield and DigiShield Technologies
Closely related to the above are the MultiShield and DigiShield technologies pioneered by DigiByte. Each of DigiByte’s five mining algorithms has a dedicated difficulty adjustment which is compared to others in order to balance out the load they work with. This balancing process itself is called DigiShield, with its advanced version designated as MultiShield. Splitting the mining between algorithms and implementing these technologies should help the DigiByte network fortify itself against potential malicious attacks.
DigiByte’s UTXO-based model is yet another building block in the platform’s security architecture. With it, individual tokens are assigned an identifier. The tokens that are received by the wallet are treated as “unspent” unless the user sends them to another recipient, after which they are treated as “spent”. At the same time, the transactions are validated only after all the data relating to the transaction are found in the UTXO database.
As for the privacy, DigiByte wants to ensure that establishing links between the accounts on its platform is made more difficult by having a party in the transaction use a new address for each received transaction.
DigiByte Wants to Go beyond Being a Payment Platform
For all the talk of payments and transactions, the key people behind the DigiByte expressed the belief that cryptocurrencies focusing only on these aspects are bound to die an equivalent of slow death. To avoid this, DigiByte plans to gradually move away from payment to expand its native technology to the following fields:
a) Cyber Security
b) Artificial Intelligence
c) Internet of Things
This shift in focus was recently announced by the DigiByte founder Jared Tate who promised the pairing of the AI technology with the DigiByte blockchain in order to create a network which will serve to protect the IoT and other devices. According to the developers, DigiByte’s scalability potential is what recommends it for the use with the IoT devices which can number thousands and grow in numbers really fast.
While these plans are still being developed, this is hardly the first time that DigiByte ventures into the world of technologies outside of cryptocurrencies. Back in 2017, it launched the DigiByte Gaming division in an effort to promote digital advertising and user engagement in games via micropayments and prizes delivered in cryptocurrency.
DigiByte History and Token Availability
Jared Tate, the founder of DigiByte, has a background in computer programming, blockchain and cyber security. He designed DigiByte in 2013 with the aim to offer a faster and more secure alternative to Bitcoin. The project officially started with the mining of the genesis block in January 2014, without organizing an ICO and drawing any significant media interest. Instead of this, the project was funded through donations given to the DigiByte Foundation which is in charge of promoting this project at the global level.
As of November 2018, the DigiByte’s market cap stood at about USD 132 million, down from about USD 1 billion it carried in early 2018. Currently, there are about 11 billion DGB in circulation and they can be traded with and acquired on the cryptocurrency exchanges such as Coinbase and HitBTC.