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Decred Price Analysis – Sustained Increase in Mining Activity
The network fundamental data indicates a sustained increase in mining activity over the past year, primarily due to the large number of BLAKE-256 ASICs that have entered the market. Decred (DCR) is a Bitcoin fork introduced in 2016, utilizing a hybrid of Proof of Work (PoW) and Proof of Stake (PoS) to integrate governance features.
Currently, DCR has fallen 85% from its all-time high of $118 reached in early May 2018. The market capitalization stands at $181 million, with a trading volume of $1.81 million recorded in the last 24 hours. DCR has one of the highest inflation rates among cryptocurrencies at 20.81% annually, surpassed only by Zcash (ZEC) at 44% annually.
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"The hybrid consensus system in DCR attempts to address the weaknesses of PoW and PoS."
The PoW miners create the blockchain and receive a portion of the block reward, while PoS participants acquire tickets that also yield a part of the block reward and can vote on whether a block is permanently added to the blockchain. The current block reward distribution is 60% to PoW miners, 30% to PoS participants, and 10% to developers.
As of now, 45.4% of the total 21 million tokens have been mined, including 8% pre-mined, amounting to 1.68 million DCR. The developer fund currently holds 602,000 DCR, valued at approximately $9,761,346.89, making it the largest single account in the network at 6.31% of the total circulating supply.
Network Activity and Developer Engagement
Transaction counts have fluctuated between 3,200 and 3,500 per day over the last six months, with a peak of 4,800 transactions in August 2017. The average transaction value has decreased from $7,900 in June 2018 to nearly $2,000 currently. Transaction fees, fully collected by PoW miners, average 0.00035 DCR per transaction, equating to $0.00636.
Developer activity remains robust, with over 3,000 commits in the 66 DCR GitHub repositories over the past year. The recent release of Decred v1.4.0 included a new consensus voting agenda and improvements in speed and integration with Trezor.
Market Trends and Technical Analysis
The DCR trading volume has been predominantly led by Bitcoin (BTC), with significant transactions occurring on platforms like DragonEx, QBTC, Binance, and Bittrex. Google Trends data shows a significant decline in searches for "Decred" since early 2018, currently at a multi-year low.
Technical indicators suggest a potential end to the multi-month downtrend for DCR/USD and DCR/BTC pairs. The DCR price has recently broken above diagonal resistance, indicating a possible shift in trend. If local lows hold, a target of $35 based on the 50% Fibonacci retracement is likely within the year.
| Metric | Value |
|---|---|
| Market Capitalization | $181 million |
| Trading Volume (24h) | $1.81 million |
| Current Inflation Rate | 20.81% annually |
| Block Reward Distribution | 60% PoW, 30% PoS, 10% Developers |
In conclusion, the sustained increase in mining activity and the robust developer engagement suggest a positive outlook for Decred. However, the declining transaction counts and active addresses indicate challenges in organic on-chain activity beyond mining and speculation. The technical indicators point towards a potential upward trend, making it a critical period for DCR in the coming months.
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