Steemit Crypto Academy Season 2: Privacy Coins by @ajewa

Introduction

Bitcoin was created with the sole purpose of having a digital currency which is decentralized, transparent and then improve anonymity but then the last function isn't so true as people can trace transactions to individuals via their public addresses. Privacy coin actually keeps transactions private thereby ensuring anonymity. This is done by obscuring data of the senders and the recievers. In this post I will be looking at Dash Coin as a privacy coin.

Choose a Privacy Coin and perform a fundamental analysis of the coin in detail.

Since I will be doing a fundamental analysis on Dash Coin, I will be giving every detail about the coin and the project so as to ascertain that it is worth investing.

A Brief Understanding of DASH

Dash, is an open-source blockchain protocol, similar to Bitcoin, but forcuses on privacy and speed (showing a near instant transaction time). Launched in 2014, as Xcoin then later renamed as Darkcoin, and then in 2015, known as DASH.

Compared to other privacy coin, Dash has become very popular due to its main usage which are Speed, Micro-fees, and Privacy.

Speed

Dash is able to perform a transaction in 1 second using the InstaSend protocol. The InstaSend protocol utilizes masternodes instead of miners to validate trasactions. Instead of validating an IstaSend transaction in the current block, the transaction is accepted by a masternode and it is broadcasted to other masternodes, and validated in the next block.

Micro-Fees

On the Dash website https://www.dash.org/, it is written clearly "Move Dash in a second for less than a cent. Any amount, any time, anywhere".

Speed is the first thing that makes Dash unique, the next is micro fees for transactions. Pay cents to transact any amount instead of paying a large amount in BTC.

Private Send

Dash allows for Private sending of tokens, thereby allowing users to transact privately withut allowing the address, amount sent and recieved as well as other data on the transaction visible to other parties. With the PrivateSend feature, the User's unspent Dash are mixed before execution of the transaction.

Dash Masternodes and Mining

Bitcoin uses mining only to verify transactions via Proof of Work, while Dash utilizes both Mining and Masternodes.

Masternodes do regular functions of nodes such as validating transactions, but instead of using large computation hardwares, all that is required is staking 1000 Dash. Masternodes on Dash are responsible for validating private transactions, instant transactions, and participation in voting. To run a masternode, 1000 DASH is needed to be staked.

Mining is another way of validating transactions, and just like Bitcoin, it uses the Proof of Work consensus mechanism. It can be mined using a CPU, GPU as well as ASIC miners. It takes 2.6 minutes for a new block to be mined and each block contains 2MB of data and a total of 56 transactions per seconds.

Dash Market Overview

Compared to other coins, Dash didn't perform any ICO, there is a maximum supply of 18,900,000 DASH, and a circulating supply of 10,160,902.63 DASH. Dash is currently traded at $200.72, a 24-hour volume of $569,320,665, and a marketcap of $2,036,319,842.

Dash has a daily active address of 86,000 (as reported by its Q4 2020 report), a total transaction per day of 23,600 (Q4 2020 report), and a payment volume of $3.64 Billion (Q4 report).

There are 265+ exchanges and brokers which transact Dash and over 4350 marchants who accept Dash as a means of payment and transact.

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Describe the steps in creating a wallet for the Privacy Coin of your choice. (Screenshot required)

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To create a Dash wallet, it is important to follow the steps. (I will be downloading a mobile wallet and creating a wallet with this).

• The first step is to install the Dash wallet from Playstore (I am using an Android device)

• After downloading, open the wallet to get to the welcome page and click on skip.

• The wallet page is opened where three options are shown, "create a new wallet", "Restore wallet from recovery phrase", and "Restore wallet from file". Click on the "create a new wallet" to begin.

• Create a pin for security purpose and to help unlock app everytime when it is used. After creation of pin, the pin is comfirmed again.

• After creation of pin, the wallet is created but the wallet isn't secure and in other to secure it, a recovery phrase is needed.

• After clicking "Secure now", another page with important warning on the recovery phrase is displayed. This warnings includes the fact that the recovery phrase is your access to the funds in the wallet , the wallet do not store recovery phrases, and recovery phrases will be needed to access funds if device is lost.

• Write down the Pass phrase in a safe place, then click on "I wrote it odwn" then the continue button.

• After confirming the pass phrase, the wallet is created and it can be accessed by inputing the pin.

• Once the pin is inserted, the wallet dashboard is opened after which deposits, withdrawals, payments, and recieving Dash is possible.

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Explain the reason you chose the Privacy Coin. (State the advantages and disadvantages)

Dash is an improvement to Bitcoin with Privacy and Speed being a major advantage over Bitcoin. It is a decentralized cryptocurrency with self-governing and self-funding, and there are a lot of improvement on the protocol. Dash is cheaper to pay for transactions compared to Bitcoin. transactions can go as low as $0.02 per transaction. There is an avenue for everyone to validate transactions wither by mining or masternode. Transactions are secured and can be sent privately without revealing any data n the transaction to the public thereby fulfilling its purpose of being a privacy coin.

Advantages of Dash Coin

• Micro fee for transactions
• Transactions are secured
• Transactions can be private and untraceable
• Transactions are performed in 1 seconds which makes it good for day to day transactions.

Disadvantages of Dash Coin

• The ability to do anonymous transactions allows it to be used for illegal and illicit purposes.
• it is not widely used currently
• Masternode allows a few set of people have a large say in governance which makes its decentralization to be questioned.
• There are a lot of competitions including Monero etc.

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Conclusion

Dash unique technology on anonymity, speed and low- transaction has given it an edge over many other currencies. When it comes to investment, Dash has a finite amount of supply which means it would be in demand more in the future when there is no supply to be mined again. When it comes to daily transactions such as shopping, paying for hotels and flights, and for business transactions, Dash is a great cryptocurrency.

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Cc: @levycore