Like a caterpillar turning into a butterfly, Decred was built to fly. The evolution and development is considered and elegant, designed to overcome substantial obstacles.
The next chapter has begun. Decred is moving onto a new mining algorithm, the Blake3 era. That will hopefully bring back GPU mining hobbyists and enthusiasts. But strap in, as we've got some interesting times ahead!
Comparing subsidy split proposals
The reduction in no votes, since the first subsidy split proposal, was considerable. During the 2022 subsidy split, the proposal received:
Yes: 30285 (95%) votes and No: 2743 (8.3%) votes.
At the time, the suspicion was the miners would have a lot more voting power, and it would be a tough vote, due to them acquiring over 60% of the coin supply approximately 8.4 million coins. (14,000,000 / 60% = 8,400,000 dcr)
In April 2023, the second subsidy split voted. This time to level the playing field. This proposal received:
Yes: 24371 (97.0%) votes and No: 744 (3.0%) votes
Once again the miners were nowhere to be seen and to most people's surprised, the no votes didn’t reach 1000 votes.
- Change PoW/PoS Subsidy Split From 60/30 to 10/80 (Feb 2022) – https://proposals.decred.org/record/427e1d4
- Change PoW/PoS Subsidy Split to 1/89 and Change PoW Algorithm to BLAKE3 (April 2023) – https://proposals.decred.org/record/a8501bc
What will happen next?
The implementation will now be built and merged into the software in an inactive state. There will then be an on-chain vote, in a few months time. If this is successful, the upgrade will automatically be implemented (after a period of upgrade time) and Decred will then use Blake3 instead of the Blake256 mining algorithm and the miner subsidy will be cut to 1% of the block reward.
Based on what happened with the previous consensus upgrade. Centralised exchanges and wallets will stop customers from sending and receiving their coins for a few weeks whilst the upgrade is installed on their systems. If you are not comfortable with this, it might be a good idea to self custody your coins to prevent disruption. Decrediton, Bison Relay and DCRDEX will not be affected by this issue.
The next phase of mining, Decred DCR, will see the mining hash rate drop off along with the mining difficulty, as the Blake 256 ASIC miners can no longer mine DCR. It is likely that we will go into single figures, e.g. +1ph/s. This mining adjustment is likely to look very wacky for a few months.
What will this do to the DCR price?
Price readjustment is difficult to determine, but based on the last subsidy split, it's likely that this will have a negative impact on the price.
The question is, how much lower before a reversal? In many respects, the majority of the damage has already been done. The next phase will see a more open, realistic version of price discovery, that has eliminated a large portion of the typical price manipulators. For better or worst, they are now gone!
In GBP terms, can it go back to the previous low of £7 or is £15 the new low? There are no guarantees, we are entering into the unknown.
Whatever the outcome, the next year or so will be an interesting ride. If you’re here for cypherpunk ideals (innovation, decentralisation, non-custodial solution and development), it’s hard not to be enthusiastic for the future.
Decred is changing the way we think about money, privacy, governance, and communications. No one said it would be easy!
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