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How the Dash Blockchain Works?

Digital Cash or Dash is a fork of Bitcoin blockchain and one of the most promising altcoins till date. It is a decentralized, peer-to-peer cryptocurrency that is intended to be as liquid as real currency such as USD/ EUR/ GBP/ CNY/INR. Based on Bitcoin’s core code, Dash comes with some brand new features such as quicker, private transactions. Similar to Bitcoin, Dash is also an open-sourced network that has its own wallet infrastructure and community and operates on a unique blockchain. One noticeable difference between Bitcoin and Dash is the transaction fees. The processing fees on the Dash blockchain is quite negligible as compared to Bitcoin.

Dash was created by developer Evan Duffield on 18 January 2014. Duffield came across Bitcoin in the year 2010 and was quite impressed by its blockchain technology. However, he recognized a few glitches in the network and decided to work on them. He wanted to make Bitcoin an anonymous network but was also aware of the fact that Bitcoin’s core developers would not allow him to make any changes to the core’s code. Thus he decided to use Bitcoin’s core code and create his own cryptocurrency. In no time, Dash was out in the market. It was initially launched as XCoin (XCO). The name was changed to ‘Darkcoin’ and the ‘Dash’ on February 2014 and March 2015 respectively.

Dash has a total supply of 21 million coins. It has an adjustable block reward which declines at a rate of 7.1 % every year. The time taken to mine a block is 2.5 minutes on an average, which makes it 4 times faster than BTC. At the start of 2017, Dash was priced at around $10, but soon exceeded the $300 mark in a few months.

The total market capitalization of Dash is a little more than $1.5 billion. The developers of the Dash network made an effort to build a payment platform that is decentralized, private and fast.
 
Decentralized: Online users can send Dash cryptocurrency to each other without having to depend on a middleman, such as the government or the bank. 

Private: Ever since its launch, Bitcoin has proved to be pseudonymous- partly anonymous, but not completely private. Dash developers, in turn, sought to build a totally private cryptocurrency.

Fast: A number of consumers feel that Bitcoin’s slow transactions make it unfeasible as a user option. In response, Dash was created to facilitate quicker transfers.

As a user, you can remain anonymous on the Dash network and make transactions through the PrivateSend feature. With PrivateSend, your transaction is assorted with other equivalent anonymous payments, which makes it difficult for a hacker to see where that transaction originated from and where it is going.

The InstantSend feature allows you to make faster payments. If you enable this feature, you may have to pay higher transaction fees to the masternodes or the supercomputers that verify these transactions. The average processing fee on the Dash network is around $0.10 as compared to Bitcoin’s transaction fee that ranges from $2 to $4.

Dash’s distinctive structure operates on a double-tier network known as the masternode network. Dash developers claim that it is an “incentivized full-node operation.”
 
Tier-1 consists of nodes or computers that interconnect with one another within the network. Miners make use of these nodes to confirm transactions and create new Dash coins. Tier-2 comprises of masternodes or full nodes. These are computers which contain the entire blockchain of Dash and implement the rules of the network. Masternodes enable specific transactions for PrivateSend and InstantSend. Additionally, they regulate the development of the Dash network.

To run a masternode, an operator has to have 1,000 Dash as collateral. He or she needs to consistently hold this collateral amount to continue running a masternode and receiving transaction fees. The block reward distribution for the Dash network is as follows:

•  45% goes to the miner
•  45% goes to the masternode operator
•  10% is reserved for the Dash maintenance fund

The 10% allocation is a big boon for the Dash network as instead of depending on community donations, Dash can sponsor its growth directly from the blockchain.

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