What Is Dash (Cryptocurrency)?
Dash is an open source cryptocurrency. It is an altcoin that was forked from the Bitcoin protocol. It is also a decentralized autonomous organization (DAO) run by a subset of its users, which are called "masternodes".
The currency was launched in January 2014 as "Xcoin" by Evan Duffield, as a fork of the Bitcoin protocol. It is an altcoin and in its early days it was subject to pump and dump speculation. It was rebranded as Darkcoin, which received press for being used in dark net markets. In March 2015, it rebranded again with the name Dash as a portmanteau of 'digital cash'. As of August 2016, Dash is no longer used in any major dark net markets worth noting.
In early 2017 Duffield, who lived in the Phoenix area, and some other people working on Dash took space in a business incubator at Arizona State University. The Dash DAO later funded a blockchain research lab at ASU.
As of April 2018, Dash's market capitalization was around $4.3 billion and it was one of the top 12 cryptocurrencies.
As of February 2019, Dash was the most popular cryptocurrency in Venezuela according to Der Spiegel.
How does Dash work?
For those familiar with any proof-of-work cryptocurrency (like Bitcoin or Litecoin), the first tier of the Dash blockchain operates in much the same way.
This layer is powered by miners who compete to create new blocks and secure the blockchain. Miners preserve the Dash blockchain’s transaction history, while preventing double spending.
The difference between Dash and Bitcoin is that it has an average block time of 2.5 minutes (compared to 10 minutes) and miners only receive 45% of the DASH minted in each block (as opposed to 100% on Bitcoin).
The MasterNode Network
The second layer of the Dash blockchain contains most of its key innovations, as it is operated by a special nodes, called Masternodes.
Any node can become a Masternode as long as it holds 1,000 DASH.
Masternodes:
Facilitate private and instant transactions
Reject improperly formed blocks from miners
Store a full copy of the blockchain ledger
Receive 45% of the block reward
Vote on how to allocate the remaining 10% of the block reward
Anyone has the ability to propose a new feature or change to the Dash network, however, final decisions are made by a vote among Masternodes.
If the number of ‘Yes’ votes outnumbers the number of ‘no’ votes by more than 10% of the total number of Masternode votes, then the new feature is implemented.
The last 10% of the block reward is allocated to a grant system, called the Dash treasury. This fund is set aside by the DAO to fund the proposals voted on by Masternodes.
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