Dash is an important cryptocurrency with a long history. When Evan Duffield and his collaborators began the DarkCoin project as X11, he had assessed several issues with what he’s always referred to as “the Bitcoin project.”
One issue he believed was addressable was the near-transparency of the blockchain. Using various “shuffling” features, DarkCoin could make it difficult to know a lot about a given transaction unless you were involved.
DarkCoin became “Dash,” which is short for “digital cash,” in 2015. Duffield gave an interview to CCN.com at the time:
One of the problems that any project based on Bitcoin suffers is the potential for 51% attacks. In its latest release, Dash has essentially solved the problem by relying more heavily on its Masternode network in addition to proof-of-working miners. The effect is that the entire network can now instantly confirm transactions.
Current Dash Core CEO Ryan Taylor recently told CCN.com that Dash’s privacy features are but one part of the experience. He prefers to view the project as a “financial user experience.” He said:
“The Dash network today is not one-dimentional. Dash delivers a user experience second to none in the cryptocurrency space today. Transactions are instant, practically costless, and incredibly secure. We have the most effective governance and funding model in the industry, the longest-running in the industry in fact. The cost to attack the Dash network exceeds even that of Bitcoin because of recently introduced security enhancements.
Dash has been grinding away developing real-world use cases as well, quietly increasing our transactions and becoming a leader in actual real-world use cases. And our next release is going to blow people away, with a complete focus on user experience and the ability to easily build applications on Dash.”
With the introduction of Masternodes, which are vested parties who play an essential role in the Dash network, two types of transactions became possible on Dash: instant and opaque.
Neither of these features yet exists on Bitcoin, and to integrate instant transactions would require an overhaul of the entire network. Opaque transactions have long been possible on Bitcoin through similar methods as used in Dash. Nonetheless, neither elder statesman has the potential for privacy that projects like Monero, Zcash, and DAPS integrated from the beginning.
The dominance of ASIC hardware creates an existential risk for most proof-of-work blockchains, but Dash is the first to introduce a drastic solution that reportedly works well.
The situation: at any time, a single entity could manage to overpower the network and control the history of Bitcoin or any other proof-of-work coin.
In crypto, this can have devastating consequences. If the situation is absurd enough, a person could make a deposit to an exchange, sell the coin, then reorganize the blockchain so that the deposit never happened.
The Dash solution: chainlocks, a technology which cements a transaction within seconds of its transmission. The upgrade essentially makes “instantsend” redundant at this point, as all transactions on Dash will conclusively be confirmed in the same amount of time. Taylor told CCN.com:
“Using ChainLocks and InstantSend together, the Dash network enables exchanges and merchants to instantly credit user accounts without risk, which dramatically improves the user experience by eliminating the delay for transaction finality from which Bitcoin and other networks suffer. It also makes incoming transactions instantly respendable. In short, we’ve created the first version of a truly cash-like cryptocurrency. We started seeing exchanges supporting this feature in the first week, and our users obviously love it. The technology also enables use cases such as transactions at the point of sale, where about 97% of all transactions still take place. That’s why Dash is used more often than all other cryptocurrencies combined on payment platforms like Anypay and CryptobuyerPay.”
Long a top 10 cryptocurrency, Dash’s move to ASIC security had its drawbacks. At one point not so long ago, a diligent user pointed out that a single miner was consistently mining at least half of Dash’s blocks.
In Dash, miners only receive 45% of the block reward and transaction fees. 45% also goes to Masternodes, while the last 10% keeps the development of the project and Dash Core afloat. This already limits the incentive to attack the network, and Masternodes would have made it more difficult.
The Dash ecosystem has always been radically different from Bitcoin and other projects of similar technical competence. At a minimum, its decentralized governance structure was a first, a version of which was instituted by Ethereum a couple of years later – to massive failure.
Does different mean better? That, of course, is for the market and the users to decide.
Last modified: August 11, 2020 3:52 PM UTC