Bitshares (BTS) , formerly called Protoshares, is an open-source financial platform and decentralized exchange on the blockchain. Launched in July 2014, it seeks to remove much of the risk involved with centralized exchanges. Over the years, we’ve seen high-profile hacks on exchanges such as Bitgrail, Bitstam and not to mention the notorious Mt. Gox. Such incidents have resulted in many users losing their funds from these third parties. A decentralized system such as Bitshares cannot be as easily compromised becuase the data is not stored in only one central location.
Bitshares was conceived by Daniel Larmer, the cofounder and CTO of Steemit and EOS together with Charles Hoskinson, co-founder of Ethereum and Cardano. Larimer posits that mining was flawed due to the network centralization that followed and because of the unfair entry requirements for miners as a result. This led to the development of a new consensus algorithm called the Delegated Proof of Stake (DPoS). This allowed the Bitshares platform to provide greater speed, efficiency and flexibility.
How it works
Signing up for a Bitshares is not that cumbersome. Users doesn’t need to provide their personal information in order to register and trade on the platform. There are no gibberish payment addresses. Just your favorite mnemonic. This is far way better than using centralized exchanges where you should provide all your information to comply with government regulations. Bitshares is more resistant to failure due to its decentralized feature. Users are in control of their own security rather than having to rely on a third party.
One of the main advantages of trading on Bitshares is that it takes away some of the volatility of the cryptocurrency market with the use of SmartCoins. This is where one of the main differences between Bitshares and Bitcoin lies. Bitshares aims to be an exchange system for value tokens (aka User Issued Assets) that are tied to real-life assets.
Users are able to stabilize their investments by converting to stable cryptocurrency assets that are pegged to fiat currencies. Since there is no need to convert to fiat currency at any time, users have greater anonymity as a result. Bitshares has its own token of the same name. Converting Bitshares (BTS) to bitUSD works much like converting to USD except there’s no need to leave the security of the blockchain. By design, 1 bitUSD will always equal 1 USD. This allows users to be protected from the volatility of the cryptocurrency market since fiat currencies are much more stable than newer digital currencies.
One particular feature of Bitshares is its scalability and ability to process transactions. In 2015, Bitshares made use of Graphene, an open-source blockchain implementation that acts as a consensus mechanism. Graphene is used by several other projects, including Steemit, and is said to be capable of 100 thousand transactions per second. This is greater than the transaction volume of Visa and Mastercard combined.
Bitshares also offers a multi-currency wallet, which is available for web, desktop and Android Mobile Phones.
Currency and Currency Support
One of the key ideas behind Bitshares is that it’s available to anyone, anywhere. Bitshares is understood to be available in all countries at present, with a greater share in South-East Asian Countries and China. It can be used to trade for anything such as gold, silver, gas, oil, national currencies and cryptocurrencies.
One of the best reasons why you should be on Bitshares is the when it comes to trading, there are no limits imposed on the user. Indeed, a user can trade any amount.
Every operation in the Bitshares ecosystem is assigned an individual fee with fees subject to change depending on the consensus. This allows the committees to change the fee structure to an amount acceptable by all Bitshares holders.
Summary and Conclusion
Bitshares is still very much an infant, and as such, there isn’t a huge number of people who have fully experienced the platform and what it has to offer. Users tend to praise the transparency of the DEX but argue that it’s more complicated to use than centralized exchanges the likes of Binance and Coinbase.
The DEX provide a whole host of benefits, such as greater user privacy and lower fees. You can even earn from the overall income by becoming a Life-time member. Bitshares is the way forward.
Have you used Bitshares? What do you think of this decentralized exchange? Let us know in the comments below!