What Is Delegated Proof of Stake (DPoS)?
Also known as: DPoS, Delegated PoS
In short
Delegated Proof of Stake (DPoS) is a consensus mechanism in which token holders vote to elect a limited number of representatives and blocks are produced only by these elected representatives. It is used in networks such as EOS and Tron.
DPoS was developed by Daniel Larimer and was first used in BitShares. In classic PoS, every stakeholder can become a validator directly, whereas in DPoS token holders delegate their voting power to representatives who run for block production; these representatives are called delegates, witnesses or block producers, depending on the network. The candidates with the most votes form the active set that produces blocks in turn. For example, EOS has 21 block producers and Tron has 27 Super Representatives. Representatives may share part of the rewards with the users who voted for them.
A small number of producers provides short block times and high transaction capacity because it speeds up communication among them. Because voting is continuous, representatives who perform poorly or violate the rules can lose votes and be removed from the set.
The most criticized aspect of DPoS is the risk of centralization. Concentrating block production in a few dozen participants can lead to problems such as large token holders being able to decide elections, vote buying and representatives striking reciprocal voting deals. In addition, a significant share of token holders not voting can cause elections to be decided by a small group.
Last updated: · This content is for information purposes only and is not investment advice.