What is Dione Protocol?

Dione Protocol, also known by the market ticker DIONE, is a blockchain project still currently in the early stages of development but looks to provide the greenest blockchain possible and incentivizes others to do so too.

This is because Dione aims to set up an incentivized energy trading economy on an EVM-compatible layer-1 blockchain.

Their main ambitions are to reduce the carbon footprint of the energy sector and to facilitate and incentivize users to take more accountability for their energy consumption habits and choices.

But, what does all that mean, and is it all hype?

What is Dione Protocol?

As I mentioned, Dione is a layer-1 EVM-compatible blockchain that is currently still in development.

But before we can really talk about it, I should explain what those words mean.

First, a Layer-1 Protocol is the main blockchain, such as Bitcoin or Ethereum.

This is in contrast to Layer-2 Protocol, which would be an application built on top of the Layer-1 platform, usually with a specific objective in mind.

A good example of a Layer-2 would be Polygon, which exists on top of the Ethereum network to help process Ethereum transactions which reduces the Ethereum gas fees, and improves the finalization speed of Ethereum transactions.

Next, EVM-compatible refers to the Ethereum Virtual Machine, which is a core component of the Ethereum network that enables the execution of smart contracts and the functioning of decentralized applications on the Ethereum blockchain.

For clarity, Smart contracts are self-executing code that executes when the pre-agreed criteria have been met.

Although the name is EVM, many blockchains are actually EVM-compatible, such as Avalanche, where Dione looks to fork its blockchain from.

In this sense, forking refers to the process of splitting a blockchain into two separate blockchains, usually due to a disagreement regarding management or update, and results in a new cryptocurrency being formed alongside the original.

Some examples of this would be Ethereum Classic and Ethereum, or Bitcoin and Bitcoin Cash.

However, in Dione’s case, it wasn’t a disagreement but a choice as the developers believe Avalanche provides better speed, security, scalability, and interoperability than Ethereum.

But that leads us to the next question, how does Dione Protocol work exactly?

How does Dione Protocol work?

DIONE was initially an ERC-20 token, which is a type of token standardisation blueprint that ensures compatibility with the Ethereum network.

Though, Dione has since decided to create their own blockchain based on the Avalanche network instead. This blockchain will be known as Odyssey.

Here, DIONE will be the native cryptocurrency.

However, the ERC-20 version of the DIONE token can still be traded from exchanges online and presently is the only DIONE token.

According to their website, after the launch of the Dione Protocol, all of the ERC-20 DIONE tokens will be consolidated and moved to the mainnet while preserving the dollar value of the wallet at the time of migration.

But, as DIONE is not yet released in its final form, anything that is written about the token should be considered speculation, or at least as having the potential to change at a later date.

That said, we do know that the upcoming platform will be a Proof-of-Stake blockchain, which makes sense for a platform like Dione.

So we’re all on the same page, Proof-of-Stake is a consensus algorithm used in blockchain networks.

Unlike the more famous Proof-of-Work, instead of relying on resource-intensive mining, Proof-of-Stake blockchains select validators to create new blocks and confirm transactions based on the amount of cryptocurrency they hold and are willing to stake, meaning deposit, as collateral.

Validators are chosen through a combination of factors, including their deposit amount and some randomization to ensure it cannot be determined who the next validator will be.

Proof-of-Stake is far more energy-efficient than Proof-of-Work, as it doesn’t require the computational power of the nodes competing to verify its transactions.

As you can imagine, for a blockchain built around a green future, it was a clear winner.

To illustrate the difference, if we look at Ethereum’s energy consumption between May 2017 and May 2023, we can see clearly when it changed from Proof-of-Work to Proof-of-Stake.

At its peak in May 2022, while working under a Proof-of-Work consensus mechanism, Ethereum’s energy consumption was 93.97 Terawatt hours per year, which is roughly equal to the energy consumption of Finland or the Philippines, but once Ethereum changed to Proof-of-Stake the consumption dropped to 0.01 TWh.

With that said, what really makes Dione unique?

What makes Dione Protocol unique?

Dione wants to move the direction of the industry and create a “prosumer-driven” model.

In this context, prosumer means a consumer who has made a proactive choice to live a greener energy lifestyle.

Dione wants to reward individuals and small businesses in particular for installing solar panels and windmills on their properties and facilities to generate electricity and sell it back to the grid.

The difference between Dione and doing it yourself is the smart contracts Dione aims to use. Although, until DIONE is fully launched we are unable to inspect them further.

But, I can say Dione will be automatic, trustless, self-governing, and enable 24/7 energy trading without the need for any centralized structure running it.

Well, this is assuming they achieve all of their development and roadmap objectives.

But how about the Tokenomics?

DIONE Tokenomics

As of yet, we do not currently know the final tokenomics of the project.

Initially, the project was released as an ERC-20 token, with a total supply of 10 billion DIONE tokens. Its use cases will include the usual classics of staking, governance, and network fees.

In terms of wallet distribution, of all the DIONE tokens in circulation, no one individual wallet owns more than 1% of the total supply, excluding a few which are operated by exchanges or owned by DIONE.

Of course, how this will all change once Dione Protocol releases its own blockchain, I cannot say for certain.

In conclusion, if you like riskier investments, and you want a blockchain that is passionate about a greener future, then Dione may be worth keeping an eye on.

Though, being so early in its roadmap and development, there really is no way of saying for sure what the future holds for Dione.

As always, nothing is ever guaranteed in crypto.

Dione Protocol FAQ