While Bitcoin and Ethereum have dominated the industry for more than a decade, other digital assets have faded away from mainstream awareness. One such asset is the privacy-focused crypto token DASH. Here’s a closer look at this coin’s unique advantages over other private digital currencies and why it’s not as popular as it once was.
Launched in 2014, DASH was one of the earliest altcoins that emerged as an offshoot from Bitcoin’s success. Developers Evan Duffield and Daniel Diaz used Satoshi Nakamoto’s blockchain model to create a new cryptocurrency that would place user privacy at the core.
Initially called XCoin and Dark Coin, the team settled on the DASH name in 2015. By 2017, the token was gaining popularity in Venezuela where the economy was falling apart. The Central American country’s civil unrest and hyperinflation coupled with government crackdowns made DASH an ideal safe haven. In December that year, each DASH token was worth $1,235 – making it one of the largest digital assets in the world by market capitalization. Since then, the price has declined by more than 92%. At the time of writing, DASH tokens are worth just $96.
DASH developers used a modified version of Bitcoin’s algorithm to mask the identity of users on the network. Each transaction was mixed and scrambled with others on the network via CoinJoin, which effectively made them difficult to track. CoinJoin’s ability to mask digital signatures was the key selling feature of DASH and other privacy-focused digital currencies during the 2017 boom.
These features meant the token could be a safe haven for users in oppressive regimes trying to avoid government intervention. It could also be useful for wealthy investors trying to safeguard their privacy, activists trying to change their country’s political landscape, or donors trying to support controversial movements. The coin’s use in Venezuela under the tight surveillance of the Maduro regime was considered a prime example of DASH’s utility.
However, new technologies and tools used by crypto surveillance firms like Chainalysis have reduced the effectiveness of these strategies.
DASH operates on a simple proof-of-stake algorithm. The network comprises of so-called masternodes, who stake DASH to verify transactions and earn a return. This subset of users with tokens at stake must simplify the verification and validation of transactions. A minimum deposit of 1,000 DASH is necessary to start off as a masternode. At the time of writing, the network offers a staking yield of roughly 5.9%.
In recent years the DASH development team has played down the privacy aspects of the token and switched its messaging to peer-to-peer online transactions. The new wallet app rolled out in January allows for merchant onboarding and access to ATMs across the world that wouldn’t have been possible under a strictly private network.