How to Buy Decred (DCR)

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Contributor, Benzinga
Updated: December 22, 2021

Want to jump straight to the answer? You can buy Decred on Changelly!

With Ethereum in the works of upgrading its network from Proof-of-Work (PoW) to Proof-of-Stake (PoS), blockchain consensus models are a hot topic within the cryptocurrency industry. Decred uses both PoW and PoS on its blockchain, adding a 2nd layer of security to its network. While Bitcoin has many more miners than Decred, it’s theoretically more expensive to hack Decred, since it uses both consensus models to verify transactions on the blockchain.

Looking to learn how to buy Decred? Let's take a look at this cryptocurrency project and find out how you can get in on the action!

What is Decred?

To understand Decred, you’ll 1st need to get familiar with blockchain consensus models. Don’t be intimidated –– they aren’t as confusing as they sound. Plus, knowing the key differences between PoW and PoS will help you understand other cryptocurrency projects you may want to invest in.

So if there's no central intermediary verifying transactions, who verifies that transactions are legit? The miners on the network verify these transactions, and they do it together. Once 51% of the miners agree on which transactions are legit, they've reached consensus. Once consensus is reached, the transactions are uploaded to an immutable, censorship-resistant ledger known as the blockchain. The 2 primary ways blockchains reach consensus is through proof-of-work (PoW) and proof-of-stake (PoS) consensus models.

Proof-of-Work was the 1st consensus model used for blockchains, and it’s how Bitcoin and Ethereum secure their networks. This model uses “miners” to solve difficult mathematical problems called hashes on the blockchain. These miners are high-powered computers that are connected to the blockchain network. Proof-of-Work consensus is secure, but it’s also energy intensive and fairly inefficient.

In contrast, Proof-of-Stake uses investors with a financial stake in the cryptocurrency to validate blockchain transactions. The blockchain chooses validators from its network at random, assigning transactions proportional to the amount of cryptocurrency the validator has staked on the network. The validators will then vote to validate transactions, and the majority vote will be considered true. If a validator tries to approve fraudulent transactions, their cryptocurrency stake on the blockchain will be taken as a penalty.

Decred uses Proof-of-Work to create new blocks on its blockchain, and then the transactions in the block are sent to a group of 5 randomly selected validators using Proof-of-Stake. This way, a 2nd validation needs to be done by the validators on Decred’s network. Even if a 51% attack occurred, the hacker would also need to be selected as 3 out of the 5 validators to approve the transaction.

Brief History of Decred

Jake Yocom-Piatt founded Decred in 2016. The blockchain has been constantly upgraded through proposals on the network. Since the network is decentralized, the blockchain can only be updated if the proposal gets a majority vote. Decred’s PoS model lets investors who own Decred tokens to vote on proposals, and its voting system is seen as more fair than other PoS models, as one’s voting power isn’t directly tied to their financial stake in the cryptocurrency.

Decred began trading in 2016 for less than $1. In the 2018 bull market, DCR reached a local high of $120 per coin before crashing with the rest of the cryptocurrency markets. Since then, Decred has appreciated back past its previous all time highs, and it’s currently trading for over $200 per coin.

How to Buy Decred (DCR)

Decred is an established cryptocurrency which is available on several cryptocurrency exchanges. Here's how to buy DCR in 3 simple steps!

  1. Open an online account.

    Now that you know what Decred is all about, you’re ready to add Decred to your investment portfolio. Decred isn’t supported by Coinbase, so if that’s the only crypto exchange account you currently have you’ll need to make a new account with another trading platform.

    The 2 best exchanges that support Decred are Binance and Bittrex. Creating an account with either of these platforms is a simple process. Just provide the exchange with an email address and password and your account will be made. 

    Depending on where you live, you may need to verify your identity before you begin trading cryptocurrencies. Some common information that cryptocurrency exchanges need are your Social Security number, driver’s license and date of birth.

  2. Buy a wallet (optional). 

    Since many cryptocurrency exchanges have been hacked in the past, it’s recommended you use a crypto wallet to store your funds on. The 2 most common types of cryptocurrency wallets are hardware and software wallets. Software wallets are generally free to use, and they’re computer programs that store your cryptocurrencies on a computer or mobile device. Hardware wallets are the most secure way to store cryptocurrency, as they store your assets offline on a physical device. 

  3. Make your purchase.

    Depending on the exchange you use, the way you buy Decred will differ. Bittrex only offers trading Decred against Bitcoin, but Binance supports both Bitcoin and USD trading on its exchange. Trading against Bitcoin can give you an idea of how your investment compares to the returns of Bitcoin, as Bitcoin’s ROI is often seen as the “standard” return in the cryptocurrency market.

Best Crypto Exchange For Decred

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Best Crypto Wallets

Here are the best software and hardware wallets for Decred. Cryptocurrency wallets let you hold custody of your digital assets, whereas exchanges hold your crypto for you. If you want to store your investments in the safest way possible, you'll need to start using a cryptocurrency wallet.

Ledger Hardware Wallet
Best For
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Best Hardware Wallet: Ledger Nano S

Cryptocurrency investors have been using Ledger to store their crypto assets securely since 2014. Ledger is the leader in the hardware cryptocurrency wallet industry, and it’s wallets support over 1,000 different coins. 

The Ledger Nano S can store Bitcoin, Ethereum, Decred and almost any other cryptocurrency token all in one place. The device is about the size of a thumb drive, and it connects to your computer via USB. The Ledger Nano S is available on Amazon for just over $50.

Best Software Wallet: Decred Wallet

Decred Wallet is made by Decred to store your cryptocurrencies on your mobile device. The application is free to use, and it’s a secure alternative to storing your Decred on an exchange. Upon opening the app, you’ll receive a seed phrase which is used to recover your wallet in case you lose access to your account. Make sure to keep your seed phrase somewhere safe –– don’t share it with anyone, as anyone with your seed phrase can access your funds.

Trade, Sell or Convert your Decred

If you plan on trading your Decred tokens, then you’ll need to keep your cryptocurrency on the exchange you wish to trade on. Otherwise, you should use some sort of cryptocurrency wallet to keep your funds safe. When you want to sell your Decred, you’ll need to use either the DCR-USDT trading pair to trade for a stablecoin, or you can use the DCR-BTC trading pair to trade for Bitcoin. 

Once you’ve sold your Decred tokens, you can send your funds to a cryptocurrency exchange that’s connected to your bank account. You can then cash out of your investment and deposit your money to your bank. 

Current Crypto Prices

With Coinbase going public this year, more institutional investors are accepting cryptocurrency as an investment that’s here to stay. The cryptocurrency market has been in a bull run for the past year, with many cryptocurrencies appreciating 10 or more times over in value. Bitcoin recently hit a new all time high price of over $64,000, and Bitcoin’s price is a good indicator of the crypto market as a whole. 

Is Decred a Good Investment?

Like other cryptocurrencies with a solid team behind it, Decred has great technology that offers clear benefits over other blockchains. However, the key barrier for Decred is onboarding more users. Decred only has a fraction of the users Bitcoin has and a much more volatile price, making it less desirable to institutional investors. Being that Decred is the 50th largest cryptocurrency by market capitalization, there still may be room for the coin to grow. Depending on your risk tolerance, Decred may be a good investment for you.

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