How does Dash Cryptocurrency work?

Dash (ticker code: DASH) is a mineable cryptocurrency, which aims to be the digital cash. It is based on Bitcoin, but different than and improved upon the original version. It includes major features such as two-tier incentivized network otherwise known as Masternodes functionality, InstantSend and PrivateSend. First launched in 2014, it is a prominent crypto-asset with high liquidity, across all major exchanges. The peer-to-peer decentralized platform enables fast, secure, instant transactions with near zero fees. The project has an active team and new updates/developments happen regularly. Dash is accepted throughout the world by many businesses and the adoption numbers are rising.

Dash Masternodes

Dash was the first cryptocurrency to implement the Masternodes concept, which is becoming increasingly popular now in other projects also. Masternodes work by allowing participants to hold a certain number of the tokens or shares in collateral, to verify transactions, manage and run the network. In lieu of the collateral, participants receive rewards for the services generated from the transactions fees, they are providing to the network plus the voting rights for the governance activity on-chain. To become a Dash masternodes owner, participant must show ownership of 1000 DASH tokens. The Masternodes concept makes certain that participants would not act, contrary to the health of the network, because they have their own stake in it. The tokens held as collateral don’t reduce over time and can be withdrawn by the participant. Masternodes enable Dash to have the two tier incentivized network, confirmation facilitating features such as InstantSend and privacy feature of PrivateSend.

Chainlocks

Another important feature of Dash cryptocurrency, Chainlocks protects the blockchain against 51% attacks. Chainlocks works by randomly selecting a quorum of 400 Masternodes, generate consensus on the latest valid block and sign it, preventing chain reorganization, by any malicious actor.

InstantSend

The primary feature of the platform, InstantSend allows people to send DASH tokens instantly anywhere in the world. The feature relies on transaction locking to prevent double spends and masternode consensus of multiple node operators. It works, by allowing deterministic selection of certain masternodes to confirm the transaction. If the masternodes determine that there are enough confirmations, the transaction is confirmed and becomes irreversible. During this time, the funds are locked from the specific input, where they were sent from, to specific output, where they are being sent. If a consensus can’t be achieved by masternodes, then the transaction is processed in the normal manner. The usage of InstantSend doesn’t result in any additional cost for the user.

PrivateSend

It allows Dash users to send funds utilizing the mixer mechanism (similar to Coin Join), so any external source is unable to determine the source of funds. It results in financial privacy, so that the origin of the transaction is obscured, against snooping parties. PrivateSend mixes one input with at-least two other users, in the first round, who wish to employ similar mechanism also, to send the transaction. The minimum number of mixing rounds are 8 and the maximum number of rounds are 16, increasing the difficulty exponentially to track. PrivateSend feature is built-in in Dash native client and can be easily utilized.

Dash Holding Wallets

Dash is one of the oldest existing crypto-currencies, hence it is supported by a large number of wallets across all major platforms such as Windows, Android, iOS, macOS and Linux. Besides its native clients such as Dash Core and Dash Electrum, it is supported by Coinomi, Exodus, Jaxx Liberty, Guarda, Edge, Abra, Bitnovo, Spend etc. The cryptocurrency also has wide compatibility with hardware wallets such as Trezor, Ledger, KeepKey and SafePal. It further supports Text based wallets like CoinText, DashText and Web based wallets like Magnum, MyDashWallet etc. You can create a paper wallet also.