Blockchain P2P payment systems such as Bitcoin have the potential to be a revolutionary invention of this century. However, despite the significant potential, they are still struggling for public and legal acceptance, although the situation is much better now than it was a few years ago. More and more various projects and applications are being released, which are gradually accustoming society to a new format of financial relationships, and the Dash blockchain is one of them. And despite its relative simplicity, it has some unique qualities that can make it really in demand not only among cryptocurrency enthusiasts but also among ordinary users.
The purpose of creating Dash
The project was launched in 2014 under the name "X-coin". Until early 2015, it was also known as “Darkcoin.” Its founder, Evan Duffield, has been an ardent Bitcoin project enthusiast since 2011. So much so that after a few years he came up with his own cryptocurrency project, in which some of the typical flaws inherent in Bitcoin were corrected.
It was Duffield who developed the Dash identity, which is why he was as CEO of the project from launch to 2017. But both in those days and now, he is the official representative of the project, so he regularly communicates with the public, telling them about the implemented technical solutions and further development prospects. Dash, like its prototype - Bitcoin, uses the Proof-of-Work algorithm as a consensus mechanism and is making through mining. The value of a coin is also determined by users and market mechanisms, without being tied to any real assets. And just like in the situation with Bitcoin, the goal of the project is to become an effective digital substitute for fiat money for making instant payments within a distributed peer-to-peer network.
However, this is where the main similarities end, and the unique features of Dash come into play. Most of them serve to get around the traditional disadvantages of Bitcoin - problems with transaction speed, privacy, regulation, distribution of miners' rewards, and a number of others. And now we will look at them in more detail.
A unique technology that defines the features of the Dash blockchain - Masternodes. They form the second tier of the network, which adds some additional functionality to it. They are selected from the common nodes that have made the greatest contribution to the development of the network so some advanced services are provided and a complete copy of the entire Dash blockchain is stored exactly through them. That is why a device with increased computing power is required to launch a masternode, as well as a deposit of 1000 DASH (at the time of this writing - July 2020 - approximately 76 thousand dollars). However, the owner of the masternode receives both voting rights and additional remuneration for providing management and advanced services.
The second tier of the Dash blockchain is formed by masternodes, and they are responsible for an advanced feature called "InstantSend" (instant transfers). When a transaction is performed within the network, the masternode can check and verify it before being included in a new block. In the Bitcoin blockchain, for example, a transaction can be considered verified only after the formation and verification of the 6th block, and each of them takes up to 10 minutes on average.
The PrivateSend function allows you to split the transferred amount into many smaller ones and mix information about them with other data transmitted through mastenodes, so the transaction becomes almost impossible to trace.
In order to overcome inflation due to overly active mining, the size of the reward for miners should gradually decrease. And unlike Bitcoin, in which the miner's reward is halved after mining several thousand coins, Dash uses a different model in which the reward is reduced by 7% every year. It is assumed that this will make it possible to quickly abandon the additional remuneration so that miners start working for a commission from checking blocks, as well as to stimulate ordinary miners and complicate the task for those who are going to use industrial equipment for this business.
The reward for mining and adding a new block to the Dash blockchain is distributed as follows - 45 percent to the miner, 45 percent to the masternode, and 10 percent goes to the decentralized budget of the network. This 10 percent does not belong to anyone specifically, but is simply held on the blockchain. And if, as part of improving the project, the masternodes approve a certain solution, a so-called "superblock" is created, which frees up to 10 percent of the value accumulated in the blockchain budget to finance the implementation of the adopted idea.
The Bitcoin blockchain is vulnerable to a 51 percent attack and hashing algorithms hacked. To prevent this in their project, the Dash developers use a unique X11 hashing algorithm. It is called so, because it uses a combination of 11 hashes. And if one of them turns out to be hacked, this will not give the hackers any advantages, and the entire system will not have to be stopped for alteration.
The ChainLock function is used to counter the 51 percent attack. A randomly selected and constantly changing quorum of masternodes first votes to include the block in the chain, and then rechecks it with the help of other masternodes, which, in turn, transmit new data to the rest of the network participants. This makes the network maximally resistant to control interception.
In addition, there is also protection against forking - no update can be implemented until there is full consensus among users.
In the case of the Dash blockchain, the community has a vote right in determining the future development of the project, and masternode owners even begin to play an important role in the process of managing the network. Of course, there is a core development team, but they are on an equal rank with the rest of the participants. According to them, they are only concerned with keeping the network operational, and their funding is also determined by community voting.
The current CEO of the project, Ryan Taylor, unlike Duffield, is more of a financier than a developer. He has worked in financial services and technology for over 15 years, and before becoming CEO of the company, he served as CFO at Dash.
Uses, benefits and prospects
The primary use case for Dash is as a secure digital alternative to cash. That is why the company is actively working to improve the payment processing technologies at the point of sale, and integrates various e-commerce companies into its ecosystem.
For this, for example, the Discoverdash.com service was created, which unites all companies that accept DASH tokens for settlements. And if you live in a major city in the USA or Europe, be sure to check this site, it is possible that there is someone near you who has collaborated with Dash.
Also, this blockchain can be used as an intermediary for fast and reliable international money transfers. Another advantage is its low commission. At the time of this writing, it is approximately $ 0.00025 per transaction.
Another surprising use of Dash is as an alternative to hyperinflationary currencies.
Despite the fact that there are already many useful features in the blockchain, the development team has no plans to stop. Their latest addition is the DashPay feature. It adds usernames, contact lists, and human-readable addresses to the system, making transactions somewhat easier. They are also constantly working to improve the quality of service and overall support for the health of the blockchain.
As you can see, the Dash blockchain really has the qualities, which are necessary to become a full-fledged replacement for traditional payment systems. It is already actively used all over the world and isn't going to stop there, therefore it is constantly developing and expanding. And most importantly, unlike many competitors, the project developer is trying to fulfill their promises. Therefore, be sure to familiarize yourself with this cryptocurrency project more completely.
CryptocurrencyAuthor: EXBASE.IO | Dec 01, 2020
NewsAuthor: EXBASE.IO | Sep 03, 2021