What is Dash?

Dash (formerly known as Darkcoin and XCoin) is an open source peer-to-peer cryptocurrency based on Bitcoin software that aims to be fast, user-friendly, and scalable.

Let’s translate that into simpler terms. Dash is a digital currency that has tried to improve on Bitcoin’s flaws. Dash offers up a form of money that is portable, inexpensive to move and fast.

The word “Dash” itself refers to the portmanteau of the words digital and cash. This pretty much sums it up as Dash has been developed to be a usable version of Bitcoin. Dash is currently a top 10 cryptocurrency with a market cap hovering around $5,944,673,000. It started 2017 at around $11 per coin and as we close in on the end of the year, the price is not far from $800 USD.

By focusing on ease of use, exposure, and technological advancements, Dash has the potential to be a long-term player in the cryptocurrency space. To learn about all things Dash, read on.

What Does Dash Do?

Compared to some of its blockchain brethren, Dash’s application is pretty simple. To take it directly from the horse’s mouth, “Dash can be used to make instant, private payments online or in-store using our secure open-source platform hosted by thousands of users around the world.”

Dash exists largely to be a decentralized PayPal and to answer the question “If I wanted to pay for a cup of coffee with cryptocurrency, how would I do that?” (i.e. the point-of-sale problem).

Behind the scenes, Dash is doing far more than these simplified explanations. For those who want to check out the technical details, here is the whitepaper. For the rest, we’ll hash (pun intended) out some more specifics below.

What Sets Dash Apart?

To understand the value proposition of Dash, you must differentiate it from Bitcoin. You also must understand the weaknesses Dash is attempting to address.

Making complex things easy for average users is one of the primary themes for Dash. An example of this is that they’ve created an alternative for people who look at a BTC address and immediately get turned off.

A BTC address: 1JHe8z4jJVDFTSjohjM4i9Hh234dLCNx2Sy.

A Dash user will never be confronted with an address like this or any other cryptographic nuances; you simply have a username.

Let’s look at a few other key improvements.

Just like BTC, Dash relies on Proof-of-Work (PoW) consensus done by miners to secure the network. But Dash has another component in their consensus system: the introduction of masternodes.

Masternodes do the heavy network lifting and are there to provide many exciting features not available on conventional blockchains. They account for “2nd tier” duties such as PrivateSend, InstantSend, and governance functions (more on this below).

Users who run a masternode pay 1,000 Dash to start and are paid 45% of the reward for every Dash block that’s mined. Given this structure, it might be more accurate to refer to Dash as a hybrid model that uses both PoW (miners) and Proof-of-Stake (PoS – masternodes).

As a fully open source project, Bitcoin doesn’t have a developer funding model, which leaves the development to be handled by volunteers or taken over by powerful mining pools. With the celebrity of being first, this has worked out okay for Bitcoin but Dash has taken things a step further.

While masternodes are incentivized to do good and can govern the blockchain (they each have 1 vote), the Dash blockchain itself is also self-funded. What does this mean? It means that a percentage of each block is allocated to the network development and promotion budget. This percentage is currently 10% and it means that developers and promoters receive direct payments, thus fueling consistent growth.

Another key area that sets Dash apart is speed. Bitcoin has famously slow transaction times, making it difficult for average people to use it day to day. Dash has addressed this with “Instasend”, a process that uses the instantX masternode feature to send and confirm transactions in seconds (not minutes or hours). Inputs can be locked to specific transactions and verified by consensus of the masternode network. Dash has taken Bitcoin’s process and streamlined it.

When Bitcoin was born, there were really no plans in place to protect the privacy of its users. People ran with the erroneous assumption that BTC transactions could be done completely anonymously.  

As things stand today, data mining companies have become extremely good at determining the source of a transaction. Dash offers a solution to this as well, in the form of their “PrivateSend” feature. “PrivateSend” allows you send funds privately by mixing it with several other transactions, thus making it hard to identify any specific transaction. It uses a coin mixing service based on CoinJoin.

To fully understand how this feature works, here is a handy primer video.

History of Dash

For a long time, the search for a true P2P electronic cash was the victim of slow upgrades and stymied by endless debate. It was into this quagmire that Dash first set sail on January 18, 2014.

If you trace back the lineage of the code, you’ll see that Dash originally forked from litecoin v0.8.6.2 (which itself was a fork of Bitcoin). In this way, Dash has a lot of the same core DNA that BTC does.

In March 2015, Darkcoin was renamed simply as “Dash”. After the renaming, around 1.9 million Dash coins were mined (that is around a quarter of the total supply). Evan Duffield, the developer of Dash, chalked this up to an “instamine” code error (he was heavily criticized for this as the glitch benefited him – full podcast discussion here or statement from Dash here) and offered to relaunch, but this proposal was allegedly shot down by the community.

Duffield also suggested an “airdrop” of coins in an effort to widen initial distribution but the community also rejected this proposal. The initial coin allocation was left as is, and many of them were subsequently sold on exchanges for relatively low prices.

Fast forward to today and the development of Dash appears to be churning along unabated. Duffield and his team have cultivated a healthy developer community and appear to be succeeding in making Dash as useful as possible and connecting it to existing crypto products and services.

The Dash Team

The Dash Core team consists of around 50 employees who are working on improving the protocol and adding new features.

(Source Dash FB)

Currently headed by CEO Ryan Taylor, CTO Andrew Freer and its original developer Evan Duffield (who now plays the role of strategic advisor), the Dash team is relatively large and still growing. Dash lists more than a few country-specific ambassadors on their roster as well, which is good news in terms of pushing for larger scale adoption. The full Dash team can be seen here.

A handful of the core team is located in Phoenix, Arizona and the rest are sprinkled throughout the globe.

How to Purchase and Store Dash

Getting started with Dash can be accomplished in three easy steps:

  1. Before buying Dash, you’ll need to get a Dash wallet such as Jaxx or Electrum Dash Wallet. For large sums, you want to have a hardware or paper wallet.
  2. Purchase Dash. If you have Bitcoin already, this is very easy as you can simply obtain Dash via your favorite exchange. But if you are trying to buy in fiat currency, you face a slightly more challenging road. You can buy Dash with a credit card on CEX.io or BitPanda. You could also fund a Kraken account with a wire transfer and then buy Dash directly, or visit one of three ATM locations in the US and pay in cash (located in Oregon, Florida, and New York).
  3. Put the Dash in your wallet. Once you’ve purchased your coins, be sure not to leave them sitting on the exchange. To follow best practices for security, you’ll want to always move the coins to a wallet — ideally an offline one, if possible.

Final Thoughts

Bitcoin probably won’t ever be used for everyday transactions unless its core protocol changes dramatically (which is unlikely). It’s this void that Dash and a few other players have stepped in.

Dash seems to be based on sound principles, has seen an enormous uptick in value and its detractors may be over-stretching their arguments.

On the other hand, serious question marks remain. Come to your own conclusions regarding how the launch of this coin (and subsequent controversy) was handled but know that many people will be only focusing on the short-term gains to be had. A fair launch or the potentially problematic nature of pre-mined coins are not issues people wanting to ride a wave of hype necessarily care about.

The release of Dash Core and the piloting of KuvaCash, a program to help coup-paralyzed Zimbabwe, has seen a recent surge in Dash price. But don’t forget that Dash is only 3 years old, and it’s yet to be seen if they will be able to really attract second-tier developers to build the blockchain infrastructure (like apps or more innovative wallets for users).

There is plenty of room for a currency to carve out its own market and as the crypto space matures, it may be more important to focus on fundamentals, not an outright winner. In this sense, Dash appears to have excellent positioning for the future.

1 Comment

  • Tradxr
    Posted 2 days ago 9:22 am 0Likes

    Dash is the new cash, create your Dash wallet with SlithEx. You can use rTrader Exchange if you wish to exchange crypto to crypto.

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