After the recent news about regulations and Chinese FUD in the cryptocurrency world, I think is a good moment to check the different options that we can find in the market for increasing the anonymity and security of our transactions In the following Privacy series.
First, I would like to introduce DASH, if we check in CoinMarketCap, we can see that its in the 5th position with a market cap of 2.6 billion dollars and a price of 350 dollars. These numbers at first get our attention, so let’s see what’s behind its technology.
Dash (DASH) is a privacy-centric digital currency based on the Bitcoin software. It allows you to remain anonymous while you make transactions, similar to cash. With Bitcoin, transactions are published to the blockchain and you can prove who made them or to whom, but with Dash the anonymization technology makes it almost impossible to trace them.
PROS
Dash’s key innovation is its Darksend system: In order to make its transactions untraceable, specially designated computers called Masternodes collect and execute several transactions at once, making it unclear whose coins are going to who. Think about it like a mixer that receives inputs and knows to whom needs to send each amount of inputs. To increase anonymity, users can opt for multiple rounds of mixing to further obfuscate the source of their coins. This system also means that there is no publicly available ledger as there is with other coins, making it difficult for third parties to analyze your transactions and calculate your holdings.
Masternode
Another key feature of Dash is its X11 hashing algorithm. Most other currencies either use Scrypt or SHA-256 for their proof-of-work systems, but X11 consumes 30 percent less power than Scrypt so users with less powerful hardware can compete to verify transactions. Other coins are becoming dominated by users running expensive custom hardware, making Dash an energy-efficient alternative.
CONS
Dash’s anonymity is not perfect – it is still possible for an attacker with government-scale resources to break through. If a government, group of hackers, other entity, or even an individual bought many masternodes (there would be no way to know if this occured), and if the transaction passed through a route where all of the masternodes were owned by that entity, then the transaction could be traced by that entity. Given the relatively low cost of masternodes and the enormous budget of governments and some organizations, the possibility that coins can be traced is real.
Another issue to have in mind is that not all DASH nodes are equal. Masternodes’ owners have more influence over the system than regular node operators. This makes DASH semi-centralized instead of the ideal 100% decentralized system.
IMPORTANT: Never invest money you can’t afford to lose. Always do your own research and due diligence before placing a trade.
If you want to keep up with our latest news please:
Follow Crypto-X's Website
Download our free Android app
Hang out with us in our Slack
Follow Crypto-X on Facebook
Follow Crypto-X on Twitter
Follow Crypto-X on Reddit
Follow Crypto-X on Medium
Donations:
♥ BTC: 14a9FrErT8j3Pp6iJSurXsrNkSqrirV7qe
♥ ETH: 0x5f982128fe96560544feef7edfbf503ab17a134f
♥ LTC: LQPkLe6xYhBxU4knEYP7rACUfj3aevfPtU