A year in the life of Dash

June 25, 2018
Chris Wheal

Dash has been described as a cryptocurrency to watch out for and touted as a viable contender for the bitcoin top spot due to its unique tools that meet the dual crypto-trader’s demands of transaction speed and user anonymity.

 

Dash coins

In 2017, the price of Dash exploded: Shutterstock

Investors have been enthusiastic from the start for the cryptocurrency that sold itself as the world’s first self-funding and self-governed blockchain protocol.

Launched in January 2014 as a decentralised cryptocurrency, Dash (DASH) ranks 13th by market capitalisation and at the time of writing had a price of $266.05 with a market cap of $2.2bn.

Although a victim of the volatile altcoin market, many analysts believe it could be on the cusp of a major break above current prices with signs of a revival.

It was created to improve on the weakness of the bitcoin network and its name stands for ‘digital cash’.

Highs and lows

In 2017, the price of Dash exploded. Since January 2017, Dash’s coin value grew 8,000%, almost six times the rise of bitcoin, according to CoinMarketCap.com. However, like so many altcoins Dash has mostly traded in the red through 2018. The coin has fallen from its record high of $1,515.39 on December 20, 2017 and its value has dropped by 76% over six months.

At the beginning of the year, it was trading around the $1,000 level, reaching a high of $1,394.28, however by mid-January the price was hovering between $790 and $822 and it dropped to $622.31 in February.

Mirroring the majority of cryptocurrencies and a general market trend, the first quarter of 2018 has seen a steady decline of Dash’s value. This was not aided by regulatory concerns.

Factors that have influenced price

Supply factors could influence price for the rest of the year resulting in increased demand for the coin. Dash is capped at 18.9 million and the circulating supply of the coin at the time of writing was 8.14 million.

Mainstream acceptance will also drive up demand. Many exchanges and vendors favour Dash over other currencies and it is listed on an extensive range of cryptocurrency exchanges and can also be purchased directly with several fiat currencies. Analysts say this easy accessibility attracts cryptocurrency newcomers and also helps improve public perceptions of its credibility.

Advantages over bitcoin

Dash’s price is driven by internal factors within the cryptocurrency market such as bitcoin’s price fluctuations. Yet the advantages that Dash offers over bitcoin could also influence price in 2018.

Bitcoin has been criticised for its lengthy transaction confirmation times, a disadvantage in this highly competitive cryptocurrency arena, and this has led several vendors to choose Dash over bitcoin. Dash’s InstantSend feature allows payments to be confirmed in under a second and this could increase its legitimacy, especially when investors have to make quick decisions.

Graphic of the Lightning Network

The bitcoin community is aiming to overcome its scalability problems with the Lightning Network: Shutterstock

The bitcoin community is, however, aiming to overcome its scalability problems with developments such as the Lightning Network. This is a “second layer” payment protocol that operates on top of a blockchain. It enables instant transactions between participating nodes and if successful, these could impact the price of Dash.

Dash’s privacy feature is another means for the project to differentiate itself from other major currencies. PrivateSend mixes transaction inputs with those of other users to obscure the origins of funds and protect privacy. This is not a default option and can be accessed on request.

The downside to the privacy feature is the unavoidable association with criminal activities. For example, in February 2018 a Europol spokesperson listed Dash as one of the most popular cryptocurrencies among criminals.

Governance and community

The Dash community is considered the most active crypto community whereas bitcoin has a warring community with many forks. Bitcoin also lacks a coherent governance mechanism that would allow for protocol changes to be easily agreed on and implemented.

With Dash, a distinguishing trait is its autonomous governance system – known as a decentralized autonomous organization (DAO) – run on a network of incentivised masternodes. It allows anyone to submit a proposal to the community. Dash power users vote to decide which projects get funded and 10% of the block reward is set aside to fund these development projects.

To become a masternode, you must buy at least 1,000 dash coins. When new coins are created, 45% of them go to miners, 45% go to masternodes, and 10% go to the network.

Dash has a monthly budget of $2.5m for technical developments so is in constant evolution, something that would appeal to a wide range of traders and investors.

Predictions for 2018

Dash has already become one of the most convenient and stable cryptocurrencies of the world. An article by Globalcoinreport.com recently said that Dash has been crowned as “the coin of the future” by crypto analysts.

The report said that for investors vying for something new, Dash ticks all the right boxes. The Dash development team is also currently opting for mass adoption by engaging in partnerships with various business organisations allowing it to potentially ‘topple some big guns’ this year.

Ryan Taylor, CEO of Dash

Ryan Taylor, CEO of Dash

Dash CEO Ryan Taylor is confident it will reach $1,000 by the end of the year – and before long surpass Bitcoin. He said: “Dash is in many ways a better Bitcoin. It has rapidly become the number-one digital currency for payments because of our cheap and instant transactions, anywhere in the world.

“It is quickly incorporating payments industry best-practices that the digital currency industry has lacked. Dash transactions lock within a couple of seconds due to our revolutionary second-tier masternode network, making Dash acceptance feasible at the point of sale and online, just like credit cards.”

What are other analysts predicting for Dash in 2018?

Taki Tsaklanos, author at investinghaven.com, said: “Dash has an edge because of the ease of use it has been working towards, the decentralized yet structured community they built, the anonymous feature they offer users and most important, the high scalability, a key feature especially as other major cryptocurrencies are struggling with slower and more expensive transactions.”

Naeem Aslam, ThinkMarkets’ chief market analyst and Forbes contributor, said: “I think there is a lot of value in some of the smaller tokens such as Dash, Ripple, and NEO … They are very cheap, but their business ecosystem is really strong.”

Eric Sammons of the Saragossa Group, said:  “From its origins as an anonymous bitcoin clone, Dash has evolved over the past two years into “digital cash. With its powerful infrastructure and self-governance/self-budgeting system, Dash is poised to break into the mainstream and become the future of money.”

Post written by Chris Wheal
Chris Wheal is editor of OpenLedger's news and features service. An award-wining business journalists himself, he runs a team of freelance journalists from across the UK and north America.

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