DMD Diamond Chain: A Blockchain with Vision and Unique Selling Points

In this part 2 of the interview with Helmut Siedl, we take a closer look at his blockchain project, the DMD Chain. (Link to part 1 with him as a crypto investor: https://dmd-diamond.medium.com/helmut-siedl-how-an-idealist-of-the-austrian-crypto-scene-made-millions-dmd-diamond-5485995b9e8c?postPublishedType=initial)

The world of blockchain technology is often characterized by loud marketing, fast buzzwords and dazzling projects. But not every chain tries to score points with impressive numbers such as transactions per second (TPS) or enormous activity statistics. The DMD Diamond Chain positions itself differently: It focuses on profound technical innovations such as improved censorship resistance, improved MEV protection and robust governance. Helmut Siedl, the driving force behind the DMD Chain, describes it as his life’s work: “For me, it means that in 20 years I can look back and say: ‘DMD Diamonds is my legacy.’”

The origins: A dino chain, revived

The DMD Diamond Chain began its journey in 2013 as one of the oldest blockchain projects, but was abandoned by the original developers. Siedl and a dedicated community decided to revive the project. “We were promised something that was never delivered, and now we had to organize it ourselves,” Siedl describes the situation. With an investment of over a million euros from our own funds and a team of independent freelancers, the chain was redesigned from scratch.

The DMD Chain used the OpenEthereum code base to achieve EVM compatibility — and thus the large Solidity developer community as well as existing Ethereum Dapps. At the same time, it combined this with the innovative Honey Badger consensus mechanism to offer new features and unique selling points. This Honey Badger system, based on a scientific paper from 2016, attracted the interest not only of the DMD Chain, but also of projects such as today’s Gnosis Chain. Initially, this mechanism was developed jointly by several projects, but only the DMD Chain demonstrated the perseverance to fully develop the complex consensus mechanism and successfully integrate it. The open beta version of the DMD Chain recently went live. The mainnet launch is planned for the first half of 2025.

Technological highlights

The technical features of the DMD Chain are all about efficiency, security and innovation:

• Honey Badger consensus mechanism: The mechanism is at the heart of the DMD Chain and is very different from other approaches. From a network of currently around 60 validators (the goal is more than 100), 25 are always selected for block production (multi-block proposer system). These validators work together in a coordinated process (P2P mesh) to collect transactions and create a block. A block is created as soon as a single transaction is received in the mempool — including all transactions that arrive within the minimum waiting time of three seconds. The blockchain does not create blocks if there are no transactions, which also saves storage space. If no transaction is received over a period of 10 minutes, a so-called heartbeat block is created to ensure the integrity of the chain. The validators’ contributions are encrypted using threshold encryption. As soon as two-thirds of the validators submit their transactions, they are decrypted and can no longer be changed afterwards.
• Dynamic block times: While other blockchains such as Ethereum or Bitcoin have fixed block intervals, the DMD chain adapts flexibly to network activity. Transactions are processed immediately, without unnecessary delays.
• Instant finality: A block is final as soon as it is created. By requiring a two-thirds majority, no parallel blockchains are created, which ensures immediate finality. Waiting at exchanges until deposits are credited, as is the case with Bitcoin or Ethereum, would not be necessary with DMD Diamond. “With us, every transaction is immediately irrevocable,” explains Siedl.
• Improved censorship resistance: By using threshold encryption, it remains unclear which validators contributed which transactions. “In our network, the block finder is address zero, which makes targeted censorship almost impossible. All 25 validators would have to censor transactions together,” says Siedl.
• Integrated random numbers: Each block contains a randomly generated number that is available directly in the blockchain — without the need for external oracles. This feature is ideal for applications such as casino apps.
• Front-running prevention: A random number generated when the block is created ensures a random order of transactions in the block. This prevents MEV bots or validators from manipulating the order to their advantage.
• EVM compatibility: Developers who already work on Ethereum can easily migrate their projects to the DMD chain.
• Decentralized governance: The DMD chain relies on a proprietary DAO (Decentralized Autonomous Organization), which not only manages crucial ecosystem parameters, but also determines funding decisions and protocol upgrades. In contrast to centralized entities such as the Ethereum Foundation or Blockstream, control lies entirely with the DAO. “We live decentralization hardcore,” emphasizes Siedl.

Challenges: Decentralization and Scaling

Despite its technical sophistication, the DMD chain faces some challenges. The network currently has around 60 active validators — a relatively low number, especially compared to larger chains like Ethereum and Solana, but similar to chains like Sui and Cosmos. “Yes, a liveness issue due to the rather small number of validators and the risk of a regulatory attack could be seen as a challenge. But here too, the community could take appropriate countermeasures,” admits Siedl.

The discussion of decentralization is often equated with censorship resistance. But with the DMD chain, this censorship resistance is ensured less by the number of validators than by the Honey Badger consensus mechanism. “Our focus is on the technological advantages that the Honey Badger provides. As adoption grows, the distribution of validators will automatically expand. A technical limit is only the number of coins and the minimum staking amount,” explains Siedl.

Another frequently mentioned point is scalability. Although the DMD chain impresses with dynamic block times, it was never designed to achieve the transaction capacity of chains like Solana. “That was never our goal. We want to offer a robust platform that is, above all, secure and censorship-resistant,” emphasizes Siedl.

In the long term, layer 2 solutions could contribute to scaling. But Siedl sees no rush here: “DMD Diamond has shown that we really live the evolution. The current, fourth version of the blockchain protocol will not be the last innovation of this chain. We scale when it becomes necessary. We currently have 20 times the capacity of Ethereum — that will not be an issue for a long time,”

DMD Chains’ place in a multi-chain world

Siedl is convinced that the future of blockchain technology lies in a horizontally scaling multi-chain world. “We see ourselves as one of many chains in a multi-chain world. This DMD Chain is designed as a general-purpose chain, but offers specific advantages for special applications,” he explains.

In principle, every type of application has space on the DMD Chain, but special properties such as extremely strong censorship resistance could greatly benefit specific use cases. He refers to the Tornado Cash incident, in which around 80% of Ethereum validators were temporarily censored. According to Siedl, such a scenario would be unthinkable on the DMD Chain.

Applications that rely on real random numbers — such as casinos or gambling dApps — could also benefit from the architecture of the DMD Chain.

In addition, the increased MEV protection could give perpetual exchanges and specialized DeFi trading venues a home that offers real benefits to their users.

The DMD Chain’s vision is a world where specialized Layer 1 chains coexist and are connected by open, standardized protocols, such as the Pantos protocol. These multi-chain systems enable projects on the DMD Chain to move tokens and applications seamlessly between different blockchains. “When these connections are created and seamlessly integrated, projects can take advantage of our Honeybadger with us while accessing the hundreds of millions of dollars in liquidity on Ethereum,” explains Siedl.

DMD Coin and Tokenomics

With a maximum supply of 4.38 million DMD (of which 3.84 million are in circulation) and moderate inflation of 2–3% annually, the system offers long-term incentives for validators and stakers. At least 10,000 DMD are required to operate a validator node, while smaller users can delegate their tokens. 10% of the network rewards go to the DAO to promote the further development of the chain. The dynamic adjustment of network fees guarantees that the usage costs remain affordable despite possible increases in the value of the token. With a current price of just under 3 USD and a market capitalization of around 11 million USD (rank #1137), DMD is positioning itself as a promising low-cap coin with potential (Jan. 2025).

Conclusion: Technological excellence instead of hype

The DMD Diamond Chain appeals to developers and projects that value censorship resistance, efficiency, instant finality, random numbers and a sustainable architecture. With its uncompromisingly decentralized philosophy and technical innovations, it offers a serious alternative in the blockchain world. “We combine the philosophy of Bitcoin with the capabilities of Ethereum and complement it with our own innovations. This is our vision for the future of blockchain,” explains Siedl.

The biggest challenge remains the low awareness of the DMD Chain. Its strengths lie less in the obvious, but in the fundamental technological advantages that make it unique.

Whether this approach is viable in a marketing-driven world remains to be seen. But the DMD Chain has the potential to find its niche — and perhaps more than that.

Please note that the information provided does not constitute financial advice and is for informational purposes only. Investing in cryptocurrencies carries a high level of risk and may not be suitable for everyone. It is the reader’s responsibility to conduct their own research and seek independent advice before making any investment decision.

Original Interview Article by OnchainAustria (German Version): https://onchainaustria.medium.com/dmd-diamond-chain-eine-blockchain-mit-vision-und-alleinstellungsmerkmalen-2a09f2dc422f

Original Part 1 Interview (German Version): https://onchainaustria.medium.com/helmut-siedl-how-an-idealist-of-the-austrian-crypto-scene-made-millions-4d34e85a4fab