Altcoin Explorer: Dash, the Digital Payments Cryptocurrency, Part 2
In the first part, we reviewed the history of Dash and analyzed its governance model. In this article, we will see some use cases of Dash, what the future of this cryptocurrency holds for us as well as some of its weaknesses.
The Venezuelan Case
Although it is still included in the category of private currencies, the rebranding carried out in 2015 allowed Dash to become a cryptocurrency with one of the strongest use cases and adoption metrics.
Dash is was built to be a payment and user experience-centric cryptocurrency. However, using cryptocurrencies as a payment method is not an obvious option for those with no exposure to cryptocurrencies. In countries where the financial system is quite efficient, people have no incentive to switch to new payment methods such as cryptocurrencies. However, in the regions where national currencies have been rendered practically valueless after suffering periods of hyperinflation, cryptocurrencies can be used as an alternative.
Venezuela, Turkey, and Hong Kong have emerged as the real frontlines of cryptocurrency adoption. Throughout 2019, Dash has seen a significant surge in new merchant sign-ups, as well as wallet downloads in Latin America. They announced that they had over 15,000 active Android wallets in Latin America, with 10,000 coming from Venezuela alone. In September, that figure was a startling 24,000 for just Venezuela.
The company also introduced an NFC card that is pre-loaded with Dash for easy use; this launch was spurred by the demand for a physical card to use cryptocurrency.
However, the revealed figures may have been somewhat inflated. Although a big advertising campaign has been made and there has been a strong interest from the Venezuelan community, users who want to experiment with dash rarely move beyond the first few transactions.
In the summer of 2019, Dash Development Manager, Contreras, explained that working with so many businesses was too complex and that the campaign would be updated to be more effective. One of the latest developments has been the acceptance of Dash at Farmarket, a pharmacy chain in Venezuela. The franchise will use the XpayCash POS, a payment system operated by Panda Exchange which uses Dash’s InstantSend technology.
Dash Plans for 2020
In 2019 Dash has introduced several major innovative features such as Chainlocks, a function that prevents chain reorgs thus making Dash 51% attack proof, and automated InstantSend, which consists of making all transactions under 4 inputs settled within a few seconds and without an increase in fees. Additionally, in order to make acquiring Dash much simpler, Dash Core Group has integrated directly into the Dash’s official iOS wallet Uphold, a popular cryptocurrency exchange used by more than 1.7 million people.
2020 will instead be concentrated on the launch of the Dash Platform, which allows users to store a significant amount of information on the blockchain and verify that information. Dash Platform will provide users with the capability to create user names, allowing one to add friends to their DashPay wallet and send and receive Dash directly to friends on their contact list instead of wallet addresses. The goal is to make the user’s experience even easier and safer.
Risks of Centralization
Dash’s efforts to promote its use as a payment method are admirable and as we have seen it can be a solution for those nations suffering from hyperinflation. However, Dash’s governance model is far from perfect and presents a certain level of centralization. As we have seen, 10 percent of Dash’s block rewards are allocated to Dash’s governance budget, effectively making its governance centralized. Another criticism of Dash is the fact that was ‘instamined’, a process that allows coins to be distributed in an unfair or uneven manner. When Dash was in fact launched, Dash miners created about 2 million tokens due to an error in the mining difficulty.
Despite these criticisms, Dash has proved to be an interesting project that aims, to solve real-world problems for the people, businesses, and governments/economies that need a form of currency unrelated to governments and central banks and where the payments industry is inefficient and expensive.