Delegated Proof of Stake (DPoS) is a consensus protocol for scalable blockchains. This consensus protocol tries to solve the scalability problems and at the same time guarantees high security in blockchains.
One of the main features of this protocol is Byzantine Fault Tolerance or BFT. Thanks to this feature it provides high levels of security in public blockchains. Its operation is based on the election of so-called “delegates“. These delegates, once elected, are in charge of creating a group thanks to which the BFT can be implemented.
The delegates are totally reliable. Among them there is a rotation of leaders, that is, each delegate has a turn to create a block of transactions. When a delegate takes his turn, he can generate a block and collect his reward for doing so. It should be noted that in case a delegate cannot create the block in his turn, he will have to wait for the next turn and will lose his turn.
In this consensus protocol, a user’s participation in the network is proportional to his or her voting power. Decisions related to the operation of the network are generally submitted to a vote in order to encourage decentralization. Another important aspect is that delegates can be penalized if they do not act correctly.
Delegated Proof of Stake was created by Daniel Larimer in 2014 with the goal of being implemented on highly scalable blockchains. The first project to implement Delegated Proof of Stake was Bitshares.
The implementation in this project, according to their whitepaper, was primarily aimed at avoiding the consequences of centralization in blockchains. This was made possible by so-called “delegates“. Delegates have the authority and duty to create and transmit transaction blocks within the blockchain.
The functioning of this Consensus Algorithm starts from three main processes. These processes are delegate voting, block creation and publication of delegate behavior on the blockchain.
In case the community finds any misbehavior or disagrees with the attitude of a delegate, it can expel him/her. Constant supervision guarantees the correct functioning of the network, since under supervision the delegates cannot commit abuses.
The Proof of Delegated Participation system has some features that differentiate it from other systems. Some of these features are discussed below: