Dash is a re brand of DarkCoin. Dash is completely decentralized and uses its own PrivateSend technology to insure that the transactions remain anonymous. Due to the speed of transaction and the simplicity of use Dash has become one of the most popular crypto currencies available.
Dash makes use of a system of masternodes as well as CoinJoin to provide all the necessary privacy features for every one of its users.
Similar to Zcash, dash provides both private and transparent transactions. Its private transaction capability, which is also called PrivateSend, is made possible through the implementation of CoinJoin.
CoinJoin was originally developed by Bitcoin’s major developer by name Gregory Maxwell. This development is a very trustless tool that merges or possibly mixes diverse Bitcoin transactions into a distinct transaction.
Its goal is to obscure the same transaction flow of every individual transaction. One thing users should bear in mind is that CoinJoin has been applied to diverse services and wallets.
However, the most widely known is JoinMarket. This is a decentralized marketplace that provides users with the ability to transact as a part of the CoinJoin transaction. Meanwhile, Dash is claiming to be decentralized.
But, its implementation of CoinJoin does not seem to be fully decentralized.
Specifics Of Dash Privacy
The PrivateSend transactions on the network are processed by the masternodes. The masternodes is actually a server that either freezes or stakes:
- A particular amount of coins
- Executed accounting and housekeeping duties
- Gets rewards for services rendered.
In the case of Dash, the masternodes must surely stake about one thousand Dash each and get to receive forty-five percent of the block reward. Output/input details of PrivateSend transactions are being logged by the masternodes.
If a distinct body can manage it or spy on the part of Dash’s masternodes, it is completely possible to simply reverse engineer the PrivateSend transactions to show the destination and origin details
Similar to Zcash, Dash has fought hard with the acceptance of all its features of privacy. In the case of Dash, the problem majorly centers around liquidity.
Because PrivateSend is an implementation of CoinJoin, it demands liquidity and also requires an order to mix efficiently and privately.
After the complaints of some users about how slow PrivateSend is, the Dash ecosystem made a vote to pay about five liquidity providers to produce liquidity for their mixing services.
Although this has helped in increasing the speed of the private send transactions, it has also caused some understandable speculations about the possible collusion between the providers.
For now, it can be concluded that privacy on the Dash system is simply in the hands of some of the masternodes and the mixing providers of liquidity.
As for its fungibility, just like Zcash, dash has optional privacy. The currency is only fungible whenever it is being used in the PrivateSend feature.
If this feature is not enabled, the transactions are totally transparent on the blockchain, and the Dash coins are not so fungible.
To Wrap It Up
Dash is ranked as the fourteenth virtual currency with about two billion dollars in its market capitalization. The coin is also being paired with Ethereum, Bitcoin, and USDT, not to forget fiat currencies.