What is DCR? Decred FAQ

Frequently Asked Questions about Decred (DCR).

4 min readNov 12, 2019

What is DCR?

It is a decentralized, community ruled cryptocurrency designed to deliver a truly sound alternative to traditional money.

In most monetary systems, a centralized authority such as a central bank holds the power. In Decred, community members with skin in the game determine the future direction of the project.

DCR — money evolved.

Everyone can get involved.

Why should I buy DCR?

The main reasons invest in Decred:

Better technology than BTC
Sustainable funding
Good governance
Optional privacy
Staking rewards
21M scarcity

Disclaimer: this is not financial advice.

Why was DCR created?

Decred was launched to provide an alternative to Bitcoin. This blog post from 2015 outlines Bitcoin’s biggest challenges: governance, funding for development, and PoW miners having too much power.

Decred gives power to the people who hold the coins.

DCR is a hedge to BTC.

When did Decred go live?

Decred mainnet launched on February 8, 2016.

Is Decred a fork of Bitcoin?

No. Decred is an independent blockchain created by Bitcoin developers who faced issues with the way Bitcoin was designed. They looked at what was successful with Bitcoin and how they could add decentralized governance from the start.

Who created Decred?

The origins of Decred can be traced back to 2013, when an anonymous Bitcointalk user named ‘tacotime’ published a whitepaper for Memcoin2 (MC2). At the start of 2014 it appeared that tacotime also began work on another popular cryptocurrency: Monero.

Jake Yocom-Piatt, the CEO of Company Zero, was approached with the MC2 concept by another anonymous user called _ingsoc. At the time, Company Zero was focused on the development of btcsuite, an alternative full node Bitcoin implementation written in Go. Their code is widely respected in the crypto community and was used by many leading projects including Ethereum, BitGo, and the Lightning Network team.

Eventually they joined forces to develop Decred (DCR).

How does Decred work?

The fundamental proof-of-work (PoW) base layer of the Decred blockchain is extended with proof-of-stake (PoS). The result is a unique blockchain with a hybrid PoW+PoS consensus system which provides an additional layer of security and a novel on-chain governance model.

How is Decred different from Bitcoin?

Decred is distinct from Bitcoin in three key ways:

Secure: Decred is proven to be more expensive to attack than pure PoW blockchains thanks to its hybrid PoW+PoS model that aligns incentives between miners and voters.
Adaptable: Decred has on-chain governance that allows it to make changes to consensus rules while avoiding hard forks.
Sustainable: Decred is funded through block rewards. Stakeholders can vote to authorize spending from the Treasury, which makes the project financially sustainable in the long-term.

Can I make money with Decred?

Beyond speculation — similar to BTC or DOGE holders — DCR holders can decide to participate in governance. Just like PoW miners are rewarded to secure the network (1% of block rewards), PoS voters are rewarded to govern the Decred network (89% of block rewards).

Staking rewards can deliver a decent ROI. Furthermore, it gives investors an on-chain vote in changing the consensus rules. Off-chain voting is also used, to approve proposals that request funding from the DCR Treasury (covered by the remaining 10% of block rewards).

Extra opportunities arise when you provide value to the ecosystem, since the Treasury could pay for your services.

Why haven’t I heard more about Decred?

Decred has been building quietly over the last years. This has allowed the community to focus on creating a robust ecosystem that will stand on its own. Marketing can’t substitute for a great product.

What‘s on the roadmap?

Decred’s vision is to decentralize and evolve money. The project is ruled by the collective intelligence of the DCR community.

Through the proposal platform, each community member can submit proposals to change the future of Decred.

Further study

Decred is a robust digital ecosystem that requires some study before it can be fully understood. Below is a curated list of the best posts, podcasts and videos to help you understand the project.