Featuring the opinion and writings of various members of Dash Nation.

Why should Venezuela use cash?

Maybe, instead of asking “why should Venezuela use Dash ?”, the question should be “why should Venezuela use cash ?”.

I’ve been thinking about this quite a bit lately and come up with some thoughts.
Basically, crypto is a synthesised monetary asset. As such the successful ones should be based on some kind of real world archetype that’s already known to work. There are in fact very few, of these namely:

  • monetary metals
  • cash
  • credit (account based money)
  • vertical tokens (sector specific e.g. BitTube, Steem etc)

Those are the pure monetary ones that hold everything else up (see “Exter’s pyramid” – scroll down). In addition we can add a couple more to cover the smart-chains:

  • computing platforms
  • settlement vehicles
  • equities

Characteristics of money

Let those be 1 dimension of analysis by which we can categorize every asset on coinmarketcap.com (i.e. we can work back to the archetype by observing each synthetic asset’s design parameters). Now lets overlay those groups (at least the tokenised form of each asset) with the 3 primary use cases of money which will effectively give us 21 potential “hard” categories:

  • store of value
  • means of exchange
  • unit of account

Most monetary commodities & assets fulfil almost exclusively the “store of value” use case. e.g. Gold bars, silver coins, stamps, fine art. None of these find significant use nowadays as either a means of exchange or a unit of account.

Meanwhile, the credit money of the fiat system finds use EXCLUSIVELY as a unit of account. There is no commodity associated with it any longer, even though they linger on in the currency titles (“Sterling”, “Peso”, “Dollar” etc). It’s simply an arbitrary unit for denominating quantities of credit.

Cash and vertical (market specific) tokens are the only ones that function as all 3. Store of value, means of exchange and unit of account. That is one reason why “regular folks” may want to use cash – because it’s something they can spend, hold, value costs with and that doesn’t loose its value.

Now lets look at the various archetypes themselves and their significant characteristics which ideally need to be carried forward into their synthetic counterparts. To do this we need to have recourse to the age-old acknowledged characteristics of money and see how each archetype gives priority to distinct monetary properties to deliver its optimal “service”.

  • mobility
  • fungibility
  • divisibility
  • scarcity
  • durability

Archetypes

  • 1. Monetary assets:

We already observed that these operate primarily in the store-of-value role. So fungibility, mobility and divisibility are de-prioritised in favour of scarcity and durability. This is the case, for example with gold nuggets, fine art, diamonds and even (nowadays) metal coins – since these are generally only fungible within a particular family (for example canadian maples). There is fungibility to a degree because metals can be melted down to erase their historical form and take up another.

Within the cryptocurrency class, bitcoin certainly follows this archetype very well. Its blocktime corresponds to its exchange time – a reasonable one for such an asset class. It is also divisible and has enough fungibility to function well as a monetary asset without de-prioritising its main role – that of storing value.

Significantly, this class can serve as a “backing” for derivative vehicles. For example when we put our money in the bank, a “derivative” form of it appears as a digital balance in our bank account which can then be transferred to someone else’s account without them actually having to be present in order to receive the exchange in person.

  • 2. Cash

Cash ideally inherits all of the store-of-value attributes from the previous monetary asset class, but places a much higher priority on 3 of the above properties:

  • mobility
  • divisibility
  • fungibility

In addition, when we look at how cash operates in the real world, we can also see 2 further aspects that characterise that archetype, and show us how those monetary properties are supported:

  • immediacy of exchange
  • transparency of the medium (the “notes” can be inspected by both/all parties)
  • continuous supply recycling

The last of these works by consolidating coins and notes in the cash drawers of merchants (mixing
inputs from different customers) and then again at banking branches (mixing inputs from different merchants) before being redistributed into circulation.

Characteristics of the real-world cash monetary archetype.

One other significant aspect of cash, is that its value coincides with the medium. What I mean by that is that the value is in the actual token being exchanged and not somewhere else, so by definition, the authentic archetype excludes account-based trading.

3. Vertical Tokens

I’ll leave these aside for the moment as they only apply to specific commercial markets. In Tom Luongo’s article above he refers to these as “utility tokens”.I

Implementation

Given than bitcoin was the reference implementation for a “reasonably” fungible, mobile and divisible synthetic monetary asset, the question then arises of how to evolve this archetype into an authentic implementation of cash. Given that the transparency requirement is already met by bitcoin (all parties can see the same blockchain attributes), we need to meet 3 additional archetypal requirements:

  • the “immediacy” of the exchange
  • the supply recycling model
  • the native medium requirement (no account based trading)

ALL of these three are an issue for blockchains. First of all, blockchains work in blocktime, not realtime so there is no inherent support for instant transfers. Nor do they have any native mixing features in the standard bitcoin implementation – mixing is purely organic arising from use. Finally, the requirement that even small transactions be carried out using the base money supply gives them a technical scaling challenge that the other asset classes don’t have (since they can benefit from account based trading).

Solutions

There are only 3 ways to solve the “immediacy” requirement in a blockchain:

  • tighten up the blocktime so its approaches zero
  • use the mempool and consider such transactions secure enough
  • decouple the blockchain protocol on-chain so it has 2-tiers: one that functions in blocktime and the other that can function in realtime

The first two of these solutions are clearly not very satisfactory since 1 is in conflict with the integrity of the mining protocol and the other is in conflict with the double-spend risk.
However, what’s interesting about the third of these is that the decoupled protocol can ALSO address the supply recycling (mixing) requirement of the archetype – and this is the course that Dash has taken.

Conclusion

So we can conclusively make the case that Dash – being the first in the world of masternode oriented, pure currency, mined chains – qualifies as an original in a distinct class of synthetic assets. It authentically implements the key aspects of the cash archetype in a way that its “competitors” (I don’t include Bitcoin in that group but, say Litecoin, BCH, Doge etc) do not.

IMO we need to therefore refer BACK to the archetype for the use cases. Why do/did people use cash ? (As distinct from credit/debit cards). How do they get it ? Where do they spend it ?

If we go back a bit in time, cash was metal coins so it held its value in addition to being a transactional medium. Getting it into people’s hands easily is therefore a major milestone to reach. Some other way than exchanges hopefully.

Thanks, Toknormal!

Amid media blackouts and speculative selloffs, Dash Nation remains positive. Here’s why.

It’s a special feeling that you get when you are heavily involved in Dash. I am going to touch on a few reasons why in this article. One of the major ones is the fact that we are a very successful, innovation-rich currency, but our successes are met in the crypto industry either with silence, or a resounding “Meh”.

Major publications such as Coindesk seem to avoid writing anything positive about Dash like the plague, and places with large memberships such as Reddit r/Cryptocurrency have legions of people who downvote any post that has the mention of Dash and its accomplishments.

Now, this is not a recent development, there are a few reasons for Dash’s seemingly pariah-like status in the crypto space.

Dash’s launch problems are partially to blame

The launch of Dash (launched X-Coin) was not without its problems, with a bug in the code that allowed it to be mined at a very fast rate, so much so that over 1 million X-Coin was mined within a short time. Critics pounced on this, and claimed that the lead developer Evan Duffield was a scammer that knowingly released X-Coin with this bug. They also claimed that Evan single-handedly mined all of the coins and shut other miners out.

This story, which has never been proven, grew into something of a cult obsession with Dash’s detractors. They did not waste any opportunity to propagate this story to any newcomers, or anyone who had anything positive to say about Dash. Over time, due to the aggressiveness of the people behind this narrative, and the relative passiveness of the Dash community to debunk it, it became a widely-held belief. Rightly or wrongly, Dash had been labeled a scam coin.

The latest Dash logo.

Funny thing about scams, though. In order to be a scam, you need to have victims. To this day, there have been no victims of this supposed scam by Evan Duffield. Dash community members who did not listen to the prevailing narrative and invested in Dash did very well financially. Those who dare to challenge the scam narrative that prevailed for so long are met with a friendly, respectful, inclusive community that have their hearts set on developing and deploying a decentralized payment system for the world to use.

The dichotomy between the way that the Dash community is portrayed in certain circles in comparison to how we actually are is remarkable. If those who chose to believe the scam narrative would actually spend some time around us they would see that. Then, maybe we would not get sidelined so much in the industry. But, because we know what Dash is about and what its lofty goals are, we stay positive for the future.

Dash’s ambitions don’t earn it many friends either…

Did you know that Evan Duffield once approached the Bitcoin Core developers about adding PrivateSend (then called Darksend) to BTC? They informed him that they were not interested in adding any changes to Satoshi’s protocol, so that’s how Dash was born.

It became apparent to all that Evan truly was a genius from the very early days. His vision and his drive to be successful attracted others of like mind who paid no attention to the prevailing narrative. Over time, a talented development team and community was assembled around Dash. We made it very clear in every interaction with the crypto community that Dash aims to be the dominant world currency, surpassing Bitcoin in time. That’s a bold statement, and one that doesn’t win you many friends in the industry.

It turns out that we have reasons to be so confident.

The list of Dash innovations is long

Dark Gravity Wave, PrivateSend, incentivized masternodes, InstantSend, the Dash budget system, and ChainLocks are all innovations that can be claimed by Dash. These innovations result in a network that is silky smooth, fast, and secure. All of these features make Dash a strong contender to be the everyday payment system of the future.

If you sat down right now and attempted to send a few dollars worth of BTC from one address to another, and did the same with Dash, you would see that the BTC would take you quite a while to be fully confirmed at its destination, while Dash would take seconds to do the same. Yes, seconds. This is made possible by Dash’s second tier: masternodes, a Dash innovation.

Working governance leads to stability

Governance in Bitcoin sometimes seems like kids playing tug-of-war.

Unfortunately for Dash right now, Bitcoin, the market leader in the space, is an unmitigated train wreck. First was the block size debate that raged on for years, leading to a fork and two different Bitcoins created. As if that wasn’t enough, the newly created currency Bitcoin Cash encountered its own governance crisis, ultimately leading to two forks as well.

This happens because Bitcoin has no clear way of knowing what the community consensus is for direction. Other than social media, which can be gamed and is sometimes rampant with censorship, with massive egos claiming superiority, BTC has no governance mechanism to rely on.

Thanks to the invention of incentivized masternodes, Dash does not have this problem. There are some strong personalities in Dash, and there is no shortage of disagreements, just like any other large crypto community. The difference with Dash is, we never dwell on arguments long enough to create irreconcilable differences. 

Differing ideas are presented, debated, and voted on by the decentralized group of large stakeholders (masternodes). The result is respected, and the currency moves forward, with nothing but a few bruised egos. The doomsday scenario of a fork does not materialize, due to a clear way to decide on future direction.

Because of this, we stay positive for the future.

I explain how Dash’s governance system works in this video.

Dash concerns itself with development and use, not price

It’s really incredible when you visit a Dash communication forum. There are a few die-hards who like to talk about price, but the majority remain razor-focused on development and adoption. The confidence that comes from Dash’s innovations leads to this attitude. Also the fact that Dash aims to be used as a day-to-day money leads this to be high on our priority list.

We celebrate the usage of Dash in far-off places like Nigeria, Germany, and Venezuela. We help the development team create new versions with even smoother features. We tip each other constantly in Dash, creating new transactions on the blockchain. 

We recently performed a stress test where we had over 3 million Dash transactions in a 24-hour period, a record in the industry. This did not get much coverage, of course, but it happened.

For Dash’s usage, we stay positive for the future.

If Dash were the market leader, things would have been different in 2018

Leading by example is something that Dash is great at. Stable, secure, fast operations, and a unified community is the reality here. Compare that to the never-ending drama in Bitcoin, and you can see that Dash really should be given a shot to assume this role one day. 

I’m not saying that Dash would have prevented the bear market, because crypto markets are heavily manipulated. I am saying, however, that if Dash’s stability and innovations were put into the spotlight the same way that Bitcoin’s failures were, the bear market may not have been so long. The added infrastructure investment that would befit a digital currency that has its act together may have reversed the bear at some point in 2018 as well.

Dash Core Group CEO reflects the thinking of Dash Nation.

Watch out for Dash in 2019!

Despite the fact that Dash’s accomplishments get the silent treatment and we feel sometimes like we are yelling into a sound-proof room, the momentum doesn’t stop. Dash’s community continues to grow, innovations keep coming, and adoption is happening globally.

Bitcoin had its chance to lead, and it’s doing a miserable job. It really needs to make way for a project that knows how to lead by example, and could quite possibly help lift the whole industry out of the mess it’s in.

If you are new to Dash and just reading about it for the first time, or you thought that we were a scam coin, I don’t blame you. That’s the way it’s been during Dash’s short history. Share this article, help us get the word out! You are welcome to join us in Dash Nation as we help forge the future financial freedom for many around the world.

A Tale Of Two Networks

A Tale Of Two Networks As the head of finance for Dash, I naturally spend a lot of time thinking about Dash’s strategy, funding and expenses and how to optimize them for our network’s growth. About a week ago, I did the unthinkable… I replied to a troll on Bitcointalk. I know, I know, “just […]