D. The DMD Diamond Blockchain's Solutions
The fourth iteration of DMD Diamond is a cornerstone of a store-of-value monetary system that is not government-issued or controlled. Our mission is to enable people to achieve financial freedom and independence, by creating a platform that provides a safe, affordable, and rewarding smart contract powered blockchain economy.
Our vision is to contribute to the blockchain ecology through the development of Open Source protocols, utilities, and services, forwarding the interoperability of blockchains, thus increasing the viability of the entire cryptoverse.
To address the industry challenges, the DMD Diamond team presents version 4 of its blockchain. DMDv4 is the first cooperative consensus blockchain with a delegated PoS-powered validator election which allows for high speed and performance, absolute censorship resistance and fork resistance, instant finality of transactions, and other advantages that a competitive consensus cannot deliver.
The DMD v4 blockchain adds the smart contract functionality and sets out to align with the industry as it is: the coin wars are over and blockchain interoperability is important for the entire industry. Therefore, DMDv4 is compatible with Ethereum EVM smart contracts, making it simple to port smart contracts written for Ethereum towards DMD Diamond v4.
Diamond is also designed so that it can be a participant in future blockchain-based ecosystems that utilize bridges and other cross-chain value transaction methods. The aim is to provide every participant with maximal freedom to host projects on the platforms that best apply to their needs. The DMD blockchain answers many of those needs, and other blockchains are part of answering specific needs for other developers and participants.
To sum it up, the list of DMD Diamond v4 features includes the following important capabilities:
-
Limited issue of tokens, with a low cap of 4.38 million tokens, with full issuance of all tokens at genesis block, with no ability to mine any additional tokens or dilute the existing amount of coins in any way.
-
Smart contract capabilities with Turing-complete programming language.
-
Instant finality of all transactions using the Honey Badger BFT protocol.
-
Fast throughput: predictions and testing demonstrate a minimum of 400 TPS.
-
Rotating validation nodes, and maximum validation node staking allows for a randomized distribution of power among validators for 12 hours (Epoch), no concentration of power, and fair rotating.
-
Censorship-resistant, utilizing threshold encryption. Single nodes cannot act maliciously against particular transactions because they cannot see the contents of the transaction until it is validated.
-
DMD staking happens with a limited set of validator nodes, and a maximum amount staked on top of these nodes because of DMD’s scarce supply.
-
Interoperability and full compatibility with other blockchains: Code written for Ethereum EVM will run on the DMD v4 blockchain enabling easy migration between chains.
-
Fork-proof, with 2/3 majority required, and no opportunity for a dispute of the chain.
-
No orphan blocks resulted from simultaneously created competing blocks are possible on the chain, because of its cooperative protocol with fractional transactions contributed by active validators threshold encrypted to the block.
-
On-chain governance support.
-
Random number generation capabilities built-in.
-
No wasted network capacity. If there are no transactions, no empty blocks are created as with other blockchains. DMD may include a very small heartbeat block if for periods of time of more than 10 minutes there are no transactions.
-
Recovery of lost coins through a fair aging mechanism that identifies abandoned coins in POSDAO after a number of years.
-
Sustainable long-term coin and ecosystem maintenance and issuance.
DMD Diamond has taken the approach that cooperation and interoperability across chains is a must for the sustainable and long-term development of the crypto industry. For that reason, the DMDv4 is being created as a system that is fully compatible with Ethereum, using Open Ethereum addressing systems and foundations, and running EVM apps according to the protocol standards. The result is that dApps can be easily migrated across chains.
Open Ethereum Client (formerly Parity) is included as part of the package for DMDv4. This is the most well-known and fastest Ethereum client and is robust and well-proven in the industry. Interoperability Bridges provide connectors to other chains, allowing the transfer of value across coins and other blockchains. DMDv4 allows easy integration by using third-party Layer 2 interoperability solutions that support DeFi apps and other apps that integrate smart contract functionality with multiple different crypto assets. Connectors allow access to games, NFT, DeFi, and other types of dApps across chains.
Other solutions can interact with or run on DMD in the future. For example via TokenBridge 8 Arbitrary Message Bridge (AMB) — a bridge designed for universal cross-chain data transfer — that could potentially allow integration with other chains in the future. The idea behind these bridges is to allow smart contracts from one blockchain to understand and interpret smart contracts from other chains so that they can work together on different types of dApps or communicate across dApps.
Such solutions allow for migration of fee intense parts or whole DeFi protocols, or decentralized exchanges, or similar projects to run partly or as a whole on DMD Diamond blockchain and still able to move assets back to other chains, for example, Ethereum.
DMDv4 will include smart contract support based on EVM so that existing smart contracts developed on other chains can run on DMD. DMDv4 supports Solidity and the other languages that are supported by the Ethereum blockchain. Because of the much faster transaction times, lower fees, the ability to run the same code on multiple chains, and easy smart contract migration back and forth, DMD represents an appealing alternative to Ethereum. DMD Diamond is a long-running blockchain with a highly distributed community of holders, meaning that it is a very secure and stable network, so application developers can feel comfortable with using DMD as a fast-throughput alternative to Ethereum.
DMDv4 is a decentralized multipurpose blockchain with a highly secure and distributed consensus algorithm and a distributed system for rewarding the nodes that secure the system. Diamond has an old community with many coin holders and uses delegated Proof-of-Stake so that every coin holder can be part of the validation mechanism and cast their weight to the validators that are acting in good faith on the system.
The DMD network allows any full node with 10,000 DMD to become a validator candidate, and for any coin holder with at least 100 DMD to stake their coins on validator candidate nodes. In this way, coin holders can signal the nodes they trust most to be reliable/stable and increase by adding coin weight on them the chance to get selected to be part of the active validator set more often. The maximum DMD per node is 50,000 DMD, either held by the node or staked by DMD coin holders. Up to 438 nodes are possible, based on the amount of DMD in circulation.
Validation rotates among the validation candidates, with 25 being picked randomly every 12 hours, called Epoch. During the Epoch, the validator nodes use the Honey Badger Byzantine Fault Tolerance consensus protocol to validate transactions, and Epoch rewards are distributed equally among nodes. The distribution algorithm is weighted such that every node will get chosen to be in the Validator Set in proportion to the amount of staking on the node.
To find more information about validation, read the Node Selection through POSDAO section.
This system is designed such that:
-
Validator Candidate Full nodes secure the system: 438 maximum, 50 – 75 expected.
-
A highly distributed system where a random subset selection of 25 active validators is made every 12 hours via POSDAO dPOS mechanic, so all validators candidates have a chance to get a turn twice a day. Note that if there are fewer than 25 candidates, the system can function with fewer validators too.
-
Coin holders can stake their coins on the nodes, showing support for the best candidates, which weights the choice and ensures that validator nodes that are more reliable are chosen more frequently.
-
Epoch rewards get split at the end of the Epoch between all active validators. Each validator then split his share between the coin owners who staked upon this validator. Misbehaving validators get no rewards at all, their coins get locked and they cannot become a part of the active set during a few Epochs.
-
HBBFT consensus algorithm allows fast/instant final transactions, high transaction throughput, and increased security of the system via threshold encryption.
Diamond DMDv4 participants can potentially be one of three types:
● Ethereum client wallet (participant). Any coin holder on the DMD network can stake their tokens on validators to earn Epoch rewards and participate in DAO voting process indirectly by choosing the validator, who represents their interests.
● Full Node. A full node includes an EVM, the POSDAO codebase, and the full Diamond DMDv4 blockchain.
● Validator Candidate Node. A Full Node can become a Validator Candidate by installing the validator candidate software and staking a minimum of 10,000 DMD. Other coin holders can stake their coins on a validator candidate, up to a maximum of 50,000 DMD. The upper limit prevents the concentration of power. Validator candidates are chosen in every Epoch to be validators, in proportion to the amount of staking they have on the node. Nodes must run on the Linux operating system (or a System that allows execution of Linux software (e.g. Windows subsystem for Linux). Read more on the validator requirements in the Validators section. It is possible to hold DMDv4 coins without staking or participating actively in the network.
The staking will be available from a web-based dApp accessible for anyone with a wallet that supports a custom Ethereum style network and WalletConnect, such as Minerva, Metamask, or MyEtherWallet.
Anyone with DMDv3 must upgrade to a new wallet and claim DMDv4 as described in the Migration from DMDv3 to DMDv4 section, and then they can easily participate in the securing and governance of the network. The manual how to claim coins is available here.
DMD Diamond v4 utilizes validators for the transactions, as per the HBBFT protocol. Each elected (active) validator receives an equal share of Epoch rewards for cooperative contributing to block creation and validating the transactions and compute smart contract executions on the DMD blockchain in a defined timeframe (one Epoch), each active validator shares the rewards among themselves and their delegates. The validation process has been described in detail in the Secure Consensus section.
Block rewards for active validators and delegates on them are split proportionally according to the number of coins staked for that validator, but besides it, the validator gets the guaranteed reward on the Epoch end. 20% of validator rewards get upfront to the node operator. The leftover 80% of validator rewards are distributed proportionally to the coin ownership (node operators coins again get their share).
Example 1:
10000 DMD - node operator stake
40000 DMD - delegated stake (shared between multiple delegates)
would result in
20% upfront to the node operator
16% to the node operator because of his 20% of staked coins
64% to the delegates owning 80% of the staked coins
Example 2:
25000 DMD - node operator stake
25000 DMD - delegated stake (shared between multiple delegates)
would result in
20% upfront to node operator
40% to the node operator because of his 50% of staked coins
40% to the delegates owning 50% of the staked coins
Validator candidates require:
● Full node installation of the DMDv4 chain on a Linux server with the DMD version of Open Ethereum which include the DMDv4 extensions including HBBFT/POSDAO and the proper configuration
● Internet with Static IP address and a reliable 24/7 uptime.
● Minimum collateral of 10,000 DMD (from validator candidate owner), maximum 50,000 DMD can be staked on one validator candidate (combined from the owner and others who stake on top of his node).
● Link to address of the node that delivers the work.
● The validator candidate registration and collateral locking through the POSDAO dApp.
Note that the node address is not the same as the address where the coins are coming from. Validator candidates re-stake the coins they earn as rewards. Validator candidates and dPOS stakers on top of them can adjust (deposit or withdraw) staked coins anytime and the change (transaction of coins) happens at the next Epoch (12 hours).
Please note, if a validator node has not been part of the active validator set for the last 10 years, it is considered abandoned. The coins associated with this validator will be moved to the Reinsert pot.
POSDAO whitepaper refers to validators and all dPOS staker on top of him as a mining pool. DMD Diamond prefers the terminology validator candidate because no mining is conducted in the DMD network and the word mining is misleading.
The DAO Governance module is a weighted voting module that allows validators to vote for system changes, upgrades, and other proposals and optionally approve requested funding from the DMD DAO governance funding pot.
Important: DAO Governance and POSDAO are different things. DAO Governance is a manual smart contract powering the decision-making tool to vote over proposals, POSDAO is an automated smart contract to support a fair and decentral election of active validators.
Only validator candidates registered on the permissionless network can vote in the DAO, but coin holders can stake their DMD token with any validator candidate they choose and change their affiliation at any time, with the change taking place when the Epoch changes.
To stake, coin holders use a web interface or the interface of a compatible wallet that can connect to a customized Ethereum-like network and interact with dApps via WalletConnect. The validator votes on behalf of all coins that are delegated to the validator. This way, distributed governance is enabled through delegated Proof-of-Stake.
All proposals and voting are public and transparent. This is important so that participants can delegate their stake to the validators that are voting aligned with their interests.
Link to the DAO manual
