Overview
BitShares holds a unique place in blockchain history as one of the most innovative projects of the early crypto era. Launched in 2014 by Dan Larimer (who later created EOS and Steemit), BitShares introduced several concepts that are now foundational to the industry: Delegated Proof of Stake (DPoS) consensus, the first functional decentralized exchange, market-pegged assets (synthetic stablecoins), and on-chain governance through elected delegates.
The BitShares DEX allowed users to trade assets on-chain with order books and market-pegged assets like bitUSD and bitCNY — synthetic stablecoins collateralized by BTS tokens. This was years before MakerDAO's DAI or modern DEXs existed.
Despite its innovations, BitShares failed to maintain relevance. Dan Larimer moved on to EOS in 2017, taking developer talent and community attention with him. The project has been maintained by a small community since, but development has essentially stalled. Trading volume on the BitShares DEX is negligible, and the BTS token has lost over 99% of its peak value.
Technology
BitShares was built on the Graphene framework, a C++ blockchain toolkit also used by EOS and Steem. Key technical features include:
- DPoS Consensus: Elected witnesses (block producers) create blocks in a round-robin fashion, enabling 3-second block times
- On-chain DEX: Built-in order book matching engine operating at the protocol level
- Market-Pegged Assets: Synthetic assets collateralized by BTS, with price feeds from elected feed producers
- Worker Proposals: On-chain governance for funding development through blockchain reserves
For 2014, this was remarkably advanced. By 2026 standards, the technology is outdated. The Graphene framework lacks smart contract programmability, modern DeFi composability, and the tooling that developers expect.
Security
The DPoS model with elected witnesses has operated for over a decade without consensus-level exploits. The small witness set (typically 21-27 active witnesses) provides fast finality but creates a smaller attack surface to defend.
Market-pegged assets have experienced undercollateralization events during extreme BTS price drops, causing bitUSD and bitCNY to lose their pegs — a known risk of the collateral model that predated modern overcollateralization approaches.
Decentralization
Ironically, BitShares' DPoS model — while less decentralized than PoW — was a genuine attempt at practical decentralization with elected governance. Witness elections, worker proposals, and committee governance were all on-chain and community-driven.
In practice, low participation rates and voter apathy have led to a small group of stakeholders controlling governance decisions. The lack of active development means decentralization is maintained by inertia rather than active community engagement.
Ecosystem
The ecosystem is effectively dead. The BitShares DEX processes negligible volume. Most market-pegged assets have lost their pegs or been abandoned. No significant new applications have been built on BitShares in years.
The community that remains is small and primarily focused on preservation rather than growth. There is no meaningful developer activity, no ecosystem fund, and no institutional interest.
Tokenomics
BTS has a maximum supply of 3.6 billion tokens with most in circulation. The token is used for transaction fees, collateral for market-pegged assets, and governance voting. With negligible platform usage, demand for BTS is extremely limited.
The token trades at a fraction of a cent with minimal liquidity. Worker proposal funding from the reserve pool continues but funds minimal development activity.
Risk Factors
- Abandoned development — no meaningful technical development in years
- Dead ecosystem — negligible DEX volume and user activity
- Outdated technology — Graphene framework lacks modern DeFi capabilities
- No leadership — Dan Larimer left in 2017, no replacement leadership emerged
- Liquidity risk — extremely thin trading volume makes BTS difficult to trade
- Market-pegged asset failure — synthetic stablecoins have failed to maintain pegs
Conclusion
BitShares deserves recognition as a genuine pioneer — DPoS, the first DEX, and synthetic stablecoins were all groundbreaking innovations. The 2.8 score reflects this historical importance offset by the reality that BitShares is functionally a dead project. No active development, no ecosystem, no competitive technology. It exists as a testament to the rapid pace of blockchain innovation — what was revolutionary in 2014 is obsolete by 2026. Unless a community revival materializes (unlikely), BitShares is a historical curiosity only.