At CoinRabbit we believe that mass adoption of any cryptocurrency is one of the most important things and work to increase the ways you can use reputable and promising assets. DGB is definitely one of these assets. In this article, we would like to tell you more about DigiByte and how you can exceed its potential by using it as collateral currency.
What Is DigiByte?
DigiByte (DGB) is an open source blockchain and asset creation platform. Development began in October 2013 and the genesis block of its DGB token was mined in January 2014 as a fork of Bitcoin (BTC).
A longstanding public blockchain and cryptocurrency, DigiByte uses five different algorithms to improve security, and originally aimed to improve on the Bitcoin blockchain’s security, capacity and transaction speed.
DigiByte consists of three layers: an application layer, a public ledger and the core protocol featuring nodes communicating to relay transactions.
Who Are the Founders of DigiByte?
DigiByte was created by Jared Tate, also known as “DigiMan,” who oversaw its metamorphosis from development to its current setup before announcing that he was temporarily retiring from his position in May 2020.
Tate has since returned, and as of September 2020 once again appears to get involved again with DigiByte development. Tate’s biography states that he was involved with Bitcoin from 2012 onwards, and authored the first book written by a blockchain founder, “Blockchain 2035: The Digital DNA of Internet 3.0.”
DigiByte’s operations depend not only on developers, but also the DigiByte Foundation, a volunteer organization supporting the DigiByte ecosystem. A third group of volunteers, the DigiByte Awareness Team, is responsible for marketing and promotional activities.
What Makes DigiByte Unique?
DigiByte is a modification of Bitcoin which aims to diversify security, speed and capacity possibilities.
Its first incarnation was as an open source blockchain and associated cryptocurrency, DGB. The network has five separate algorithms which help to maintain security and help prevent ASIC miners from commandeering too much power.
Later, another offering, DigiAssets, appeared, with DGB as its native token. DigiAssets appeals to those developers looking to launch digital assets, decentralized applications (DApps) and encode the necessary corresponding smart contracts.
All governance structures for DigiByte are run on a voluntary basis, in line with the thesis that the network should be open source and publicly accessible. Transaction fees in DGB are paid to miners for validating the blockchain.
How Many DigiByte Coins Are There In Circulation?
DigiByte (DGB) is a Proof-of-Work (PoW) cryptocurrency, and miners earn tokens for validating blocks via block rewards.
In January 2014, 0.5% of the total DGB supply (105 million coins) was premined. 50% of the premine was reserved for development purposes, while the remainder was given away.
DGB has a hard supply cap of 21 billion tokens, with mining forming an emission curve with decreasing issuance — the block reward reduces by 1% each month.
DigiByte has stated that it purposely did not try to raise funds or give away tokens through instruments such as an initial coin offering (ICO) or similar token sale.
How Is the DigiByte Network Secured?
DigiByte uses a total of five proof-of-work algorithms to secure the blockchain and reduce the risk of double spending or 51% attacks.
Difficulty adjustments ensure resilience against hostile moves within mining circles, with DigiByte claiming to have the most advanced such difficulty setup among cryptocurrencies.
With roughly one block every 15 seconds, DigiByte’s blockchain has managed to prove the longevity of its PoW blockchain since launch, now having a much longer chain of PoW than, for example, Bitcoin.
Where Can You Buy DigiByte (DGB)?
DGB is a freely-tradable altcoin and is available on multiple exchanges. Trading pairs are available for cryptocurrencies, stablecoins and fiat currencies. All the platforms listed down below had the lion’s share of volume for DGB trading pairs as of September 2020.
Bilaxy is an centralized exchange, which claims to have hundreds of thousands of traders from more than 80 countries all over the world. It has a strong focus on on liquidity for new tokens for global crypto traders.
Binance is a world’s leading exchange, which has a strong focus on altcoin trading. The platform offers crypto-to-crypto trading in more than 500 cryptocurrencies and tokens., including Bitcoin, Ether and its own token Binance coin.
Bittrex is a cryptocurrency exchange, which pays attention to the safety of its users, respecting, among others, banking secrecy. There are currently over 190 cryptocurrencies listed on the Stock Exchange in pairs for BTC, ETH, USDT. It also supports fiats.
Starting now you are able to use your DGB as a collateral currency at CoinRabbit. Here are some insights about it.
Using DGB as a collateral at CoinRabbit
Unique approach is something we don’t usually see in the cryptocurrency sphere. While keeping in mind distinctive aspects of DigiByte we released DGB crypto backed loans strongly related to them:
- The process of taking DGB loans at CoinRabbit is quite easy. Literally, a few clicks to get your funds
- It takes under 10 minutes to receive the loan
- Funds are being kept in a cold wallet and our risk management system every second checks the convergence of each transaction and instantly terminate it if something goes wrong
- Everything relies on our own funds, efforts and resources being invested in the project. On top of it, we are responsible for everything ourselves
- We do not identify our clients, we do not know where you are from and who you are. In most cases passing KYC is not needed (except for the cases when funds were sent from a blacklisted address)
Taking crypto backed loans at CoinRabbit has more different opportunities and provides wider adoption of the currency. Here are some capabilities:
- Unlock the value of your holdings without selling or switching to other currencies
- Spend received loans whatever you want. Let it be daily purchases or reinvestments
- No time frames. Repay the loan whenever you want let it be in 1 year or in 1 month
- The APR is 14%
- No KYC required
- You only need your phone number or email to get the funds
- 24/7 customer support is always at your back
Risk management and what should you keep in mind while taking loans?
Though crypto-backed loans are great and powerful tools like any other financial activity, taking crypto-backed loans has its own risks. We would like to share some important points you should know and/or constantly monitor:
- There is a liquidation price of all collaterals. You should be aware of your collateral currency price fluctuations. If your collateral currency reaches its liquidation price it will be sold instantly. This is the ONLY reason to lose your collateral
- We will notify you multiple times before selling your collateral as it reaches liquidation price. The best thing you can do to avoid it is either buy your collaterals back by repaying the loan amount + accumulated APR or deposit more funds to reduce your liquidation price
- Our LTV (Loan-to-Value) is 50% which means your collateral price should drop by 50% before being sold. Still, you have to keep an eye on it closely
- The best time to take crypto-backed loans is when you believe that the currency price is going to grow in the future (no matter the time term). One more tip is to get loans when you think its “a dip” already
- Statistically, the market grows further every year. That’s why we suggest to choose mid-term and long-term loans to increase potential returns and reduce the risks
- Do not use highly volatile currencies as collateral
- Take everything moderately, let it be investing, holding or taking crypto loans. Do not overextend
What should you do if the market dumps?
- First, we are always ready to return the funds. If you feel that the liquidation price will be broken through very strongly then buy the collateral back as soon as possible
- Secondly, you can always increase your deposit amount to lower your liquidation price if the market drops significantly
- Finally, take advantage of all these tips and then you will discover the true potential of using our service, and at the same time you will still be able to count on the full amount of your DGB in the future since more and more new ways of using this asset appears
Think forward with DGB loans at CoinRabbit.
Not financial advice. Do your own research and take everything moderately.