Dash calls itself “digital money that’s better than cash.” The altcoin is a cryptocurrency that forked from the Bitcoin protocol back in 2014. Originally known as “Xcoin” then more recently “Darkcoin,” this coin prides itself on privacy.
Dash was born out of the need to improve on perceived flaws in Bitcoin: including privacy and transaction times. As with other cryptocurrencies, the main idea behind Dash is to provide an alternative finance – electronic cash that you can send, spend or invest online. However, before you ‘make a dash for it,’ what is Dash, and is dash trading worth it?
What's Different About Dash?
Dash is all about privacy. The coin was designed to protect the anonymity of its users without impacting the speed at which they could send and exchange money. Like most cryptocurrencies, Dash runs on a public ledger or “blockchain.” This means that the peer-to-peer network of other users verifies each transaction. Where Dash is different, however, is by using a tandem setup. Unlike Bitcoin, which uses “miners” (computers solving complex problems to decrypt code and verify transactions), Dash operates a two-tier network where miners and “masternodes” run in tandem. This means much faster transaction speeds.
What Are Masternodes?
Masternodes are a feature unique to Dash. Essentially, they are the subset of users powering Dash – a network of powerful servers that approve the transactions and host copies of the blockchain. Thanks to masternodes, Dash does not face the same scalability issues as coins such as Bitcoin and Ethereum. Dash ensures the loyalty and inclusion of the users running the masternodes by rewarding them with a 45% share of each new block. In addition, each masternode operator has to purchase 1,000 Dash – a kind of poker “small blind” to keep them locked into the game!
The masternodes power many of Dash’s best features:
Users can send money near instantaneously with InstantSend. Formerly known as “DarkSend,” this feature ensures the transaction takes place within two seconds (for an extra fee.)
Governance & Treasury:
Dash rewards stakeholders for their involvement in community projects with 10% of the block share. This system ensures fair and stable participation in the Dash ecosystem.
This is a complicated process to guarantee the privacy of your transaction by “shuffling” your Dash with other users. Once called “PrivateSend,” CoinJoin mixes the “coins” in your wallet with at least two other people, with the idea being to safeguard the value and ensure you are always in control of your Dash. By making the transactions untraceable, Dash protects the anonymity of its users.
Often, the security of a blockchain payment is guaranteed through multiple “confirmations.” This makes the payment secure – but slow. ChainLock answers this problem by signing blocks as they are mined.
The Instamine Controversy
With over 4,100 masternodes, the Dash network is now one of the largest in the cryptocurrency world, making this one ‘helluva coin.’ The unique features like CoinJoin and InstantSend make Dash stand out for privacy and security without sacrificing speed or scalability. Yet, the coin has not always shone so bright.
Back in 2014, when Dash launched, a bug in the software meant that 2 million coins were created in just 48 hours. Only 18 Dash coins can be mined in total, yet 10% were “instamined.” Worst of all, one of the people who gained the most from this was Dash creator Evan Duffield. That does not look good! Dash claimed that the bug was caused by a problem with the original Litecoin code. However, not everyone in the cryptocurrency community was convinced.
Dash has come a long way since its wobbly launch, however. Today, the coin is applauded for its privacy and security features and near-instant transactions. Many cryptocurrencies’ slow transaction times make them an investment rather than a viable alternative to fiat currencies. With this coin, users could spend online as well as trading Dash.
What's Next For Dash?
Dash reached its all-time high in late 2017 when the cryptocurrency market was booming. This soon followed a recession and Dash has been unable to recoup its losses, whereas Bitcoin has already surpassed its 2017 record. This “lost ground” could be one reason for thinking that Dash has a clear growth path ahead, as it has already been valued much higher in the past, and with less developed tech and fewer individuals and businesses using their platform compared to today. If Dash can secure business deals with some major payment systems, their price may well rocket. Dash already collaborates with a number of businesses in the retail sector, making it a more useful, popular, and valuable coin.
If we try to predict Dash’s price based on its past performance, using chart indicators and oscillators, the outlook is bullish until 2025 and beyond. Ultimately, Dash’s price will depend on its level of adoption. Mass adoption appears to be a strong possibility which, in turn, is based on their speed, privacy, and security on offer. PrivateSend is chiefly responsible for Dash’s highly secure network and InstantSend affords Dash its high speeds and low transfer costs. The exact percentages from different Dash forecasts vary from source to source. Some investors believe Dash will reach the same prices as Bitcoin which may just be wishful thinking, but even conservative estimates see the coin’s value more than doubling in the years to come.
How To Trade Dash?
If you want to trade Dash, there are a number of trading options open to you. Below are four of the most popular strategies for investing in Dash.
This is the simplest option. You can simply purchase the coin in the same way you can purchase stocks or commodities. When the value of Dash increases, as does the value of the position you will be holding.
“CDFs” stand for “contract for differences”. You will not own any Dash directly, but you will essentially place a bet on its performance with your broker. You can choose to leverage more money and, therefore, gain a higher profit margin. You will then settle your contract at an agreed date. Be aware of the potential losses you may incur before borrowing any money.
Options contracts are another type of derivative bet you can place. Unlike CFDs, however, they are generally used to hedge against losses (although you can use a CFD to make an options contract too). The trader agrees the coin’s current price (known as the “strike price”) for a relatively small fee which then gives the buyer the “option” to sell at that price, until an agreed date.
Like options contracts, futures contracts are also a form of hedging. Again, the contract is made between the broker and the trader, and it is an agreement to buy a coin at a set time for an agreed amount. This is referred to as a “long position” for the buyer and a “short position” for the seller. Unlike an options contract, traders are obliged to purchase the coins at the end of the contract.