Digital Gem Token's Voting or Chain Governance Mechanism
In terms of security, the main problems with Proof of Stake cryptocurrencies is the nothing at stake problem.
The nothing at stake problem applies to masternode Proof of Stake cryptocurrencies, traditional Proof of Stake cryptocurrencies and also Delegated Proof of Stake cryptocurrencies such as Digital Gem Token.
In short, all Proof of Stake cryptocurrencies suffer from the nothing at stake problem.
However, only Delegated Proof of Stake cryptocurrencies such as Digital Gem Token can adequately mitigate the risk posed by the nothing at stake problem.
Firstly, the nothing at stake problem arises because miners, whether they are masternodes, delegate nodes or traditional Proof of Stake miners have all the incentives to mine on both forks whenever there is a fork in the cryptocurrency whether it is done by an intentional malicious actor or even if it accidentally forks.
This is because Proof of Stake miners can get transaction fee rewards on all forks without having to spend any real world costs such as electricity.
To illustrate, with Bitcoin's Proof of Work, there is a cost if the cryptocurrency forks because the miner has to use electricity in the real world to mine the chains. So, miners naturally tend towards choosing the genuine fork. However, with Proof of Stake, miners can choose to mine on both chains because they get the mining fees no matter which chain wins.
Digital Gem's Delegated Proof of Stake consensus solves this problem by having 51 validator nodes that are voted in, in a one coin equals one vote fashion and can be voted out at any time. This economic voting system ensures that the validators behave because if they don't they get voted out and their future fee income stream is gone.
Other Proof of Stake cryptocurrencies implement slashing or other means of punishment for bad actors which we feel is less advantageous because code is code and code cannot account for all situations, all the time. Humans, on the other hand, are dynamic and can respond to change with much better accuracy and judgement.
Thus, we feel that the voting governance mechanism that mitigates the nothing at stake problem in Digital Gem Token is the best way forward.