Updated: Dec 20, 2019
BitShares is designed as an industrial-grade decentralized trading platform for high-performing financial smart contracts. BitShares (symbol BTS), was formerly known as ProtoShares (PTS) and is a peer to peer distributed ledger and industrial-grade “crypto-equity”, which is based on a Delegated Proof of Stake (DPoS) algorithm.
This guide will talk about the purpose behind BitShares, the team who created it, the way it works, and the various uses and applications.
What Is BitShares Designed For?
BitShares was designed to create coins with a predictable stable price and reduced volatility, which made the cryptocurrency space more trustworthy. The team also intended for the crypto platform, to create a relatively reliable solution for predicting the future value of a token.
The cryptocurrency is created to extend the innovation of blockchain tech to more industries (beyond the financial sector), which are currently relying on the internet for their services. This includes music, voting, and auctions.
Who Is the Team Behind BitShares?
BitShares was created in 2014 by the visionary leader Dan Larimer, who is also referred to as the Bytemaster. Larimer is the co-founder of Steemit, EOS and, Cryptonomex. He also comes with a clear vision, which is helping move the BTS cryptocurrency towards a massive slice of the global market for decentralized exchanges.
How Does BitShares Work?
BitShares works more like equity as opposed to a purist “cryptocurrency”. This is because BTS coins are employed as collateral for numerous decentralized financial services, such as currency rails, smart contracts, banking, decentralized exchanges, and derivative creation of market pegged “bitAssets”.
The noteworthy blockchain is lightning fast, with 1.5 second average block times. It has a throughput potential of 100,000 transactions per second. This is more than the combined transactions of all credit cards worldwide.
BitShares works on a decentralized framework, and the management is controlled by a Decentralized Autonomous Company (DAC). This framework allows all BitShares holders to contribute equally (basis their stake), and eventually decide on the future course of action. The DAC operates independently of any external influence. However, it is in sync with its open-source code base that is developed upon and tweaked constantly.
BitShares also focuses on user experience by using the wallet address as the username. This is much better than regular experience with other crypto wallets, where long cumbersome strings of letters and numbers are required.
The platform is based on Graphene, which is an open source C++ blockchain implementation acting on a consensus mechanism and used by several other real-world projects, such as PeerPlays.com (gaming site and token PPY) and Steemit.com (decentralized Reddit, blog platform).
What are Current and Future Applications of BitShares?
The cryptocurrency competes with traditional banks by issuing collateralized, stable and market-pegged bitAssets, which are also called smart coins. This allows crypto-based assets to track real-world market assets. For instance, the “bitAsset” that denominates US Dollar is known as bitUSD.
They are less of a cryptocurrency and more of security, as they cannot be mined and are primarily used as collateral. Tokens that are created on the BitShares network are convertible to BTS, which are then converted to bitAssets. These bitAssets are tied to real-world market rates of assets and currencies.
Besides bitUSD, bitEUR and bitCNY are also based on the price of real world currency, namely the current price of the euro and yuan. bitAssets are tied to gold and silver as well in the form of bitGOLD and bitSILVER.
This kind of stable crypto option is considered a haven for people in volatile markets, which includes some South American countries, like Venezuela where hyperinflation has taken hold. In such areas, where local fiat currency is struggling, BTS proves to be a sensible and stable currency option.
The best part about BitShares is that it is completely free from counterparty risk but has collateral backed loans. This is achieved by allowing the software protocol and network to perform settlements, and secure collateral.
BTS is currently accepted on numerous crypto markets, including CoinEgg, ZB.COM, OpenLedger, DEX, Binance, and LBank, where it is traded daily. The trading pairs include BTC, USDT, and ETH.
The BitShares blockchain has the fastest confirmation time and the biggest transaction capacity, as a public blockchain. It is proven to support 16,000 operations per second and 3,300 transactions per second, with the potential to handle 100K TPS. This means it can already handle the cumulative transaction volume of Ethereum, Bitcoin, Visa, and Litecoin.
The BitShares team is highly involved in the project. It is known to persevere despite the many challenges and stay afloat, by ironing out kinks. The platform is bound to attract immense interest from FinTech and financial service players, as it grows and matures.