Draft:DMD Diamond

Origins and DMD v1 (2013)

DMD Diamond was launched on July 13, 2013, as a hybrid Proof-of-Work (PoW) and Proof-of-Stake (PoS) cryptocurrency. It first appeared on the Bitcointalk forum under the title “Diamond DMD – a new PoW/PoS coin | Super random blocks | Only 4.38 million total.” The original version (DMDv1) utilized much of Bitcoin’s codebase but incorporated a hybrid PoW/PoS consensus model similar to Peercoin, along with a limited maximum supply of 4.38 million coins. It also leveraged technologies from other projects, including random superblocks (inspired by Luckycoin) and transaction comments (as used by Florincoin). The initial emission schedule was designed to produce all 4.38 million coins within eight years.

Several months after launch, the original developer abandoned the project. The community on the Bitcointalk forum organized to save DMD Diamond, with a group of developers volunteering to take over maintenance and upgrade the codebase. This community takeover, led by Helmut Siedl and other contributors at the end of 2013, became a defining moment in the project’s history and established the community-driven governance model that persists to this day.

DMD v2 (2014)

In April 2014, the community launched DMDv2, based on the Mintcoin codebase. This version introduced a significantly extended emission model: rather than eight years, it would take over 40 years to produce all 4.38 million DMD coins, with a constantly decreasing inflation rate. The community also agreed to switch the PoW algorithm from Scrypt to Groestl, a highly efficient ASIC-resistant mining algorithm that allowed users to continue mining with GPUs. This made DMD Diamond the first cryptocurrency to successfully manage a switch to a different mining algorithm while retaining the entire blockchain history, address balances, and transaction records. DMDv2 was positioned as a store of value with a more sustainable and reliable codebase.

DMD v3 and Masternodes

Seeking further evolution, the community decided to introduce masternodes—full nodes that store a constantly updated copy of the blockchain and provide additional services, similar to networks like DASH and PIVX. The DMDv3 upgrade refined the reward system and implemented masternode functionality, which made transactions faster, more anonymous, reduced the required number of confirmations, and offered a more robust ecosystem. However, the masternode architecture was ultimately not sufficient to realize the project’s core vision of becoming an ecosystem capable of hosting a variety of projects and smart contracts, akin to an alternative evolution of Ethereum.

Decision to Build DMD v4 (2018–2024)

In 2018, DMD Diamond held a community vote that approved the start of development on an entirely new blockchain, DMD v4. The goal was to build a platform ready to serve as a pillar of the future blockchain space by adding new layer-1 features and smart contract capabilities. DMD v4 was planned to replace the old network, with existing v3 coins claimable at a 1:1 ratio on the new chain.

In 2019, the DMD Diamond Blockchain released its first v4 White Paper as a PDF (since 2024, hosted on a GitHub wiki and continuously updated). The v4 development utilized the OpenEthereum codebase to achieve EVM compatibility and integrated the Honey Badger BFT consensus mechanism, based on a 2016 academic paper. Development milestones included an Open Alpha testnet in 2021, an Alpha2 testnet with added features in 2023, and a code audit of the claiming and DAO contracts in November 2024. An Open Beta phase began on December 9, 2024, inviting developers and blockchain enthusiasts to test features such as instant block finality, EVM compatibility, and on-chain DAO governance.

DMD v4 Mainnet Launch (October 2025)

After several years of development, testing, and community feedback, the DMDv4 mainnet officially launched on October 13, 2025. The transition included a snapshot of all DMDv3 balances on October 6, 2025, with coin holders able to claim their v4 coins at a 1:1 ratio. Exchange deposits and withdrawals were paused from October 4 and resumed after exchanges completed integration with the new chain.

Immediately following the mainnet launch, the DMD Diamond team presented at the European Blockchain Convention (EBC) in Barcelona from October 15–18, 2025, building on their participation at the 2024 edition where blockchain visionary Helmut Siedl served as a keynote speaker. The project has never relied on external fundraising such as ICOs or venture capital, and there was no premine. Each upgrade has been funded by the community, reflecting the project’s commitment to independence and integrity.

Consensus Mechanism

DMD Diamond v4 is the first blockchain to implement the Honey Badger Byzantine Fault Tolerance (HBBFT) cooperative consensus algorithm, combined with a Delegated Proof-of-Stake (DPoS) validator election system known as POSDAO.

HBBFT is the first practical asynchronous BFT consensus algorithm. Unlike traditional blockchain consensus mechanisms that rely on a single leader to propose blocks, HBBFT operates without a leader node. All 25 active validators propose their transactions simultaneously in a cooperative manner. The algorithm makes no assumptions about message delivery times, meaning the network continues to function even when communication between nodes is delayed indefinitely. This asynchronous design eliminates the bottleneck of time synchronization and leader dependence, allowing nodes to operate at different speeds and process data in parallel.

Key properties of this consensus implementation include instant transaction finality (a block is final as soon as it is created, with no possibility of chain reorganization), dynamic block times that respond to network activity, threshold encryption that encrypts transactions until consensus is reached (preventing validators from selectively approving or censoring transactions), integrated random number generation in each block (eliminating the need for external oracles), and front-running prevention through random transaction ordering within blocks.

The POSDAO validator election mechanism ensures decentralization through a rotating set of 25 active validators selected every 12-hour epoch. A two-thirds consensus is required to validate changes or produce blocks, eliminating orphan blocks. Validators earn epoch rewards for their participation in block creation and share these rewards with their delegators. A maximum staking ceiling of 50,000 DMD per validator pool prevents any single entity from accumulating disproportionate power within the network.

Ethereum Compatibility

DMD v4 is fully compatible with the Ethereum Virtual Machine (EVM), allowing seamless migration of smart contracts and dApps from Ethereum and other EVM-compatible chains. The key management system is identical to Ethereum, meaning any WalletConnect-compatible wallet that supports custom networks (such as MetaMask, Brave, and Trust Wallet) can interact with the DMD Diamond blockchain. DMD v4 offers a throughput exceeding 400 transactions per second, 20 times higher block gas limits than Ethereum, and near-zero transaction fees, making it a low-cost and high-speed environment for developing decentralized applications across DeFi, GameFi, NFTs, and other verticals.

Sustainability

The blockchain is designed for eco-friendliness, having completely eliminated the energy-intensive mining associated with Proof-of-Work systems in the v4 architecture. DMD v4 implements a sustainable and endless reward mechanism with its finite supply of 4.38 million coins. The system recycles abandoned or unclaimed coins back into circulation through designated smart contract addresses (the Delta Pot and Reinsert Pot), enabling sustainable network growth without increasing total supply. All coins were issued at the genesis block with no ability to mine additional coins or dilute the existing supply.

Decentralized Governance

DMD Diamond operates a Decentralized Autonomous Organization (DAO) module that became active with the v4 mainnet launch. The DAO enables community-driven decision-making through on-chain voting, managing ecosystem parameters, funding decisions, and protocol upgrades. In contrast to projects governed by centralized foundations, control over the DMD Diamond protocol lies entirely with the DAO and its participants. The DAO treasury receives funds from the blockchain’s economic mechanisms and can allocate resources through approved proposals.

Scarcity

With a fixed supply of 4.38 million coins issued at the genesis block, DMD is significantly scarcer than Bitcoin. No additional coins can be mined or created, preventing dilution through mining or additional issuance. DMD Diamond had a fair launch similar to Bitcoin, with no premine and no ICO.

Censorship Resistance and Security

DMD Diamond’s implementation of threshold encryption ensures that transactions are not encrypted until consensus is reached. Only when in state as a block contribution, it is not encrypted until a 2/3+1 majority is reached, and then when the block content is visible, it can't be changed any longer. Validators cannot see the contents of transactions before including them in a block, which provides protocol-level protection against frontrunning and censorship. The cooperative consensus model means that all 25 active validators would have to collude to censor a transaction, making targeted censorship practically impossible. The block producer is recorded as “address zero,” further obscuring which validators contributed specific transactions.

Staking and Validator System

Validators and coin holders can stake between 10,000 and 50,000 DMD to secure the network and earn epoch rewards distributed every 12 hours. The system offers two pathways to becoming a validator: running a self-hosted validator node (for technically experienced users) or using the configurable node-operator share option, which allows non-technical users to delegate node operation to a third party while retaining ownership of the validator pool. The node-operator share can be configured between 0.01% and 20% of the validator owner’s rewards. Coin holders who do not wish to run validators can participate through delegated staking on existing validator pools.

Community and Team

DMD Diamond is a community-driven project with no corporate backing. The project has operated without centralized control or external funding since inception, relying solely on community-driven efforts. Key contributors include:

• Helmut Siedl – Blockchain visionary providing technical guidance, coin economic design, and technology selection. Leading the vision and research since 2013. Co-founder of lab10 collective and founder of Blockserv Blockchain Services.
• Thomas – Core developer behind the DMD Diamond blockchain, leading node software, infrastructure, smart contracts, and protocol implementation.
• David – Software developer with over 15 years of experience, contributing to consensus and protocol research optimization.
• Aleksander Mesor – Focusing on operations and community engagement with over seven years of leadership.
• Axel – Smart contract designer and auditor, focused on security, efficiency, and scalability of on-chain logic.
• Salman – Web3 full-stack developer building smart contracts, backends, and frontends for the DMD ecosystem.
• Dieter – Responsible for online presence, official website, digital communications, and online marketing.
• Lukas – Active in the DMD Diamond Association, contributing to organizational development and strategic direction.
• Braineeq – Long-time contributor in blockchain content creation and community management, ensuring global audience reach through education and engagement.
• Leila – Supporting community engagement activities and external communications.

DMD Diamond Association

The DMD Diamond Association is a non-profit organization established in Austria to educate about and advance the decentralized principles of the DMD ecosystem. Announced just before the DMDv4 mainnet launch in October 2025, the Association does not own or govern the DMD Diamond blockchain. Instead, it participates in and supports the ecosystem, funding its operations through community donations or approved DAO funding proposals. Its primary goals include stimulating the creation of decentralized applications and smart contracts on the platform, supporting developers with documentation and resources, conducting educational initiatives, and serving as a focal point for organizations interested in the DMD Diamond ecosystem.

Grant Program

In June 2025, DMD Diamond launched a grant program to fund dApp and tool development on the ecosystem. The program offers up to $5,000 for projects in DeFi, GameFi, NFTs, and other areas, with a grand prize of a full validator node with 10,000 DMD for outstanding contributions. The grant program aims to expand the ecosystem and foster innovation by attracting developers to build on top of DMD Diamond’s industry-first capabilities.

Roadmap

Following the v4 mainnet launch, DMD Diamond’s roadmap includes multi-chain integration to realize the core vision of interoperable, interconnected blockchain ecosystems; deployment of a decentralized exchange (Uniswap-style DEX) running on the DMD blockchain; on-chain censorship-resistant messaging; a Diamond Naming System for decentralized identity; and the launch of third-party projects being developed by ecosystem participants, including collectible and gaming applications. The project envisions itself as part of a heterogeneous, multi-chain future where different blockchains serve complementary functions.