Simply about DPoS
The fundamental difference between the PoS, DPoS and PoW algorithms is the principle of choosing the participant who will have the right to add a new unit to the circuit. In networks with PoW, those who wish to add a block to a race solve a cryptographic puzzle, and the first guessing person adds his block and receives a reward. In PoS, participants put on con gens to get a chance to add a block. The greater the rate - the greater the chance. But if in PoW miners receive a predetermined reward for creating a block and a commission from each transaction included in a block, in a PoS the reward is limited only to commissions from transactions.
In the case of DPoS, participants voluntarily nominate candidates for the role of a validator - a complete network node that checks and adds blocks for a fee. The remaining participants vote for candidates by tokens, and the weight of votes is distributed according to the number of coins deposited. Based on the voting results, a pool of validators is formed. A special algorithm creates a queue of validators and in turn, gives them time to add a block. If the node does not have time to add a block, the right passes to the next participant in the queue. When the queue ends, the algorithm re-forms a pool of validators and allocates places.
In principle, the work of DPoS algorithm can be formulated in the following stages:
Token holders choose the validators
Algorithm picks N validators. N is pre-set number of validating nodes
Validators approve and stash blocks in accordance with the pre-set order
At any time, voting members may withdraw your voice tokens and deposit them as a bid for another validator. If validator will attempt to block transactions in a block or otherwise try to "bypass" the rules to the next cycle it will not be selected in the pool, and the reputation of such validator will suffer.
Delegated Proof of Stake is robust under every conceivable natural network disruption and even secure in the face of corruption of a large minority of producers. Unlike some competing algorithms, DPOS can continue to function when a majority of producers fail. During this process the community can vote to replace the failed producers until it can resume 100% participation. I know of no other consensus algorithm that is robust under such a high and varied failure conditions.
-explains the creator of DPoS algorithm, Dan Larimer
Validators compete only for votes of tokens holders, and this happens outside the network. Once in the pool, validators are interested in cooperation and normal operation of the blockchain. The validator remuneration mechanism depends on the project: the percentage of the issue of new coins or on transaction fees, a fixed amount, etc. In addition, there are variations of the DPoS algorithm with the different number of validators in the pool, a threshold for entering the role of a validator and rewards.
Minter developers have created a modified version of DPoS with a focus on mining accessibility - MDPoS. Thanks to MDPoS in the Minter network, you can delegate not only native tokens but also coins created by users.
The developers emphasize that the absence of PoW-mining expenses for electricity and equipment, the ability to delegate any coins to the network and the low financial threshold for entering the role of a validator is a logical development of the cryptocurrency mining approach.