Dash is a peer-to-peer electronic payments system that improves upon the flaws of the Bitcoin network, namely the lack of privacy and the slow transaction speed, to bring practicality to day-to-day transactions. Want a cup of coffee? Pay with Dash. Contribute to projects? Dash. Purchase goods and services? Dash.
The project is the brainchild of Evan Duffield, who first created the cryptocurrency in 2014 from the Bitcoin core code with a few additional tweaks. It was initially branded as XCoin and DarkCoin, only to later become a portmanteau of the words ‘digital cash’ when it revamped its idea of ensuring anonymity to becoming a medium for daily transaction purposes.
Dash is currently headed by CEO Ryan Taylor, with Evan Duffield as Strategic Advisor and a large team to oversee every aspect of operations, from development to marketing.
The DASH coin has a total supply of 18 million coins, and can be purchased with fiat money on exchanges or via ATMs. The average block time is 2.5 (much faster than Bitcoin!) and the block reward decreases annually by a rate of 7.1%. Unfortunately, during the coin’s launch, an initial glitch caused 1.9 million coins to be mined (about 10% of the total supply). Duffield suggested an airdrop or the relaunch of the coin, but both ideas were rejected by the community. The coin allocation was left as it was, with majority of the coins being sold on exchanges at low prices.
With Dash, payments are instant, private and secure at remarkably minimal fees. How does Dash manage so?
At the heart of the Dash network, is a unique two-tier validation architecture. The first layer consists of miners who, like the Bitcoin network, find blocks of transactions through Proof-of-Work. However, these transactions aren’t cleared unless they receive a number of confirmations, a process that takes quite a while! This is where Dash introduces a new concept: Masternodes. Masternodes are special servers working in clusters, called quorums, and so form the second layer to the network. They are responsible for approving transactions coming from the miner network, and therefore reducing the number of nodes needed for confirmations. As of now, there are around 4800 Masternodes all over the globe.
To run a Masternode, a person must make a heavy investment of 1000 DASH- A Proof-of-Service mechanism. Dash incentivizes this two-tier model by splitting the block reward; 45% of the reward is received by Masternodes, 45% to the miners themselves, and the remaining 10% is set aside to the Treasury that fund projects for development. In addition to this, ANYONE can come up with a proposal to aid the growth of the Dash network. These proposals then undergo voting; approval by 10% of the Masternodes leads to acceptance of the proposed idea.
Masternodes have also a set of certain decentralized functions like InstantSend (payments are confirmed in a matter of seconds), PrivateSend (protects transaction history from prying eyes) and overall governance of the system by implementing changes through voting.
InstantSend utilizes the second tier of a quorum of Masternodes to ‘lock’ on to the inputs of the transaction and broadcast it to the network in just a few seconds, thereby circumnavigating the problem of double spend. PrivateSend, on the other hand, works on the concept of CoinJoin to add privacy to transactions by scrambling coin inputs to prevent the transaction history from being traced. Each session to limited to a 1000 DASH and requires three clients to participate.
The Dash network employs an X11 hashing algorithm, designed to prevent an ASIC monopoly, make GPUs use less wattage and run 30-50% cooler.
An exciting project by the Dash team is Dash Evolution, a decentralized application which aims to bring easy access to just about everyone. Users would be able to send and receive payments from other users, and can also interact directly with merchants with only a single click.
Dash is accepted by a number of merchants- From web stores to online casinos, games to bill payments, and business services to VPN providers. Dash has also partnered with Arizona State University to fund research and scholarships on blockchain technology. The TenX wallet is even testing mobile apps and debit cards converting Dash into fiat currencies.
Final thoughts? Dash isn’t without tricky competition, but its internal infrastructure does make it a promising cryptocurrency. And with Dash Evolution coming soon, we’re certainly very excited.