Ever since cryptocurrency first came into being, there has been much debate over which role crypto should play.
This discussion has raged on for years in the Bitcoin community--some believe that Bitcoin should primarily operate as a sort of ‘digital cash’ that can be used in everyday life, while others argue that Bitcoin is a ‘digital gold’ that should be bought and held for extended periods of time. Others still see Bitcoin primarily as a vehicle of volatility that exists primarily for trading purposes.
However, with the entrance of an increasing number of institutional players into the Bitcoin space--and the ongoing un-resolution of a number of technical difficulties on the Bitcoin network--Bitcoin seems to have made a definite movement away from the ‘digital cash’ side of the battle.
But while Bitcoin is establishing itself as ‘digital gold,’ other Cryptocurrencies are working to fill the gap when it comes to digital cash. One of these is Dash, a cryptocurrency created in 2014 that describes its purpose as “[giving] you the freedom to move your money any way you want,” and “[moving] money anywhere, to anyone, instantly, for less than a cent.”
Recently, Finance Magnates sat down with Ryan Taylor, chief executive of Dash Core Group (DCG), to discuss governance on Dash, what ‘decentralization’ really means, and the future of cryptocurrency usage.
Finance Magnates · Blockchain Podcast #127 -- Ryan Taylor, CEO of Dash Core Group
Before Ryan became the chief executive of the DCG in 2017, he held the organization’s Director of Finance position. Dash is an innovative digital currency that offers a number of improvements over Bitcoin, and Dash Core Group supports its development. Ryan has also been described as an expert in the Payments industry, and has more than 15 years of experience in financial services and technology.
This is an excerpt of Finance Magnates’ interview with Dash Core Group CEO Ryan Taylor. It has been edited for clarity and length. To hear the full interview, visit us on Soundcloud or Youtube. Special thanks to Ryan and to the DCG team.
Dash Core Group is "one of many entities that serve the network.”
Ryan clarified that while he is the chief executive of the Dash Core Group (DCG), he is not the chief executive of Dash itself.
“The network itself does not have a CEO, but there are many different entities that serve the network in various capacities,” Ryan explained, adding that “Dash Core Group is one of many entities that serve the network.”
“Dash Core Group is a very pivotal and important organization to Dash--we’re primarily responsible for the protocol itself; we also do quite a bit of business development and marketing; we manage social media and things of that nature for the network, and help to nurture and grow it.”
“In addition, we’ve got teams across the globe that are working in local markets in order to gain adoption for Dash.”
However, Ryan also explained that decisions on the future of the Dash network are not made by DCG or by these teams--instead, decisions are made through a network-wide proposal system.
Other crypto projects “lack the formal coordination that we have,” Ryan Taylor says
“The Dash network is decentralized,” he said. “It’s very similar to Bitcoin in that regard. The difference is that Dash has something called a ‘proposal system’...Dash was the first cryptocurrency that recognized that there’s more than one way to add value to a network, and that there’s more than one role that should be incentivized.”
“Initially, that was just MasterNodes and miners,” he continued.
MasterNodes are servers that are owned and operated by Dash users who can prove ownership of at least 1,000 Dash (worth roughly $80,000 at press time) for an extended period of time--Ryan explained that while anyone can download and run a full node on the Dash network, “MasterNodes are special nodes that have additional responsibilities on our network.”
“Each MasterNode gets one vote; the highest-ranking proposals payout first as part of a monthly budget cycle,” Ryan explained.
“It’s through this proposal system that the network decides how to allocate the resources available to the proposal system...Dash Core Group is organized as a regular company; we’re a Delaware C-corp, and we have an internal organization structure similar to any other organization.
“That allows us to be quite organized and coordinated, as opposed to a lot of other projects, which [may operate] on volunteer efforts, or through major investors that might fund certain activities. They lack the formal coordination that we have.”
“Hundreds of millions of dollar worth of Dash would be required in order to act in a malicious way on the network.”
However, “what is unique about the DCG is its ownership,” Ryan said. “I don’t own DCG; we took 100 percent of the shares in DCG and we issued those shares to a trust. The trust beneficiaries are the network operators, the MasterNodes.”
The relatively large amount of collateral that one must hold in order to operate a Dash MasterNode has been criticized by crypto community members who believe that anyone should be able to have equal access to all the roles on a decentralized network.
However, Ryan said that the collateral plays an important role in maintaining the network’s decentralized hygiene: “the reason for the 1,000 DASH collateral is that it prevents any one person from controlling the [governance] layer of the Dash network.”
“If it were essentially ‘free’ to upgrade your node to a MasterNode, someone could come in and theoretically create thousands of these things and basically control our network. Requiring the 1,000 DASH collateral really prevents any one entity from controlling a signfiicant number of them--that ensures that it’s decentralized.”
“Hundreds of millions of dollar worth of Dash would be required in order to act in a malicious way on the network, as an example.”
“Decentralization is not something that’s binary.”
As such, Ryan argues that Dash’s governance model--while it may be criticized for having elements of what could be considered centralization--prevents hidden centralized forces from taking over the network.
“Decentralization is not something that’s binary, where you’re either ‘centralized’ or ‘decentralized.’” he explained.
“‘Centralized’ is very easy to identify, but ‘decentralized’ is more of a continuum,” he went on. “You’re never fully decentralized.”
“In Bitcoin’s network,” for example, “...when it comes to things like scalability, the block size, whether or not to implement SegWit--all of these decisions are essentially made by the miners, and there’s a handful of them that control the majority of the network.”
“There are pictures of meetings betwee 4-6 people that control more than half the hashrate on the Bitcoin network; that’s the threshold for making decisions.”
In other words, “you could literally have a conference table of the number of people that have decision-making authority over the [Bitcoin] network; to claim that is decentralization--or ‘absolute’ decentralization--is absurd.”
“On Dash’s network, we have the same level of centralization over our mining as [Bitcoin]--but we’ve introduced this additional layer, the MasterNode layer; in order to control the network, you would need to control both.”
"Privacy is kind of an important ‘default’ to have on a network."
‘We’re rolled out new features continuously over the last several years that do make the user experience better,” Mark explained. “And we have a ways to go.”
“Looking back in time, what are some of the features that we’ve rolled out that are consumer-facing?”, he continued. “The first was privacy--we have an optional privacy feature that adds safety to the network for people that are using it. We’re well-known for that, and have been for a long, long time classified as a so-called ‘privacy coin.’”
However, Mark said that “really, that feature is a privacy-enhancing technique that’s [also] available on Bitcoin and other networks. It’s called CoinJoin, and it basically complicates transactions so that it’s harder to spy on people on the network.”
“I think that privacy is kind of an important ‘default’ to have on a network for several reasons,” Ryan continued, “And that was the initial use case for Dash.”
Leveraging the MasterNode network
“Beyond that, though, we really started to focus on other ways that we could leverage the masternode network. One of those was ‘InstantSend’--that was first introduced back in early 2015, and it basically allowed for transactions to instantly confirm in a way that merchants would allow you to purchase something and walk out of their store with the goods and not worry about whether or not the transaction would go through.”
However, “that early implementation was not that scalable. It wasn’t on by default, and there were additional fees for using it, so we just didn’t see a lot of uptake of that.”
“But we continued to iterate and improve--we introduced ChainLocks and an improved version of InstantSend that basically makes Dash very cash-like.”
“At this point in time, I could send Dash to you, and you could spend it right away; the end-recipient would have no risk that the transaction wouldn’t go through. Right now, to get that same type of experience with other cryptocurrencies, you have to wait about an hour for each one of those hops. In our case, it takes less than two seconds per hop.”
"More ‘regular folks’...have started using [Dash]"
“[...] What we’ve seen with the introduction of this technology is that more ‘regular folks’--people who you wouldn’t normally expect to start using cryptocurrency--have started using it,” Ryan continued. “Probably our greatest success story has been in Venezuela, where we have thousands of merchants that accept it, and they see users walking in the door and using it.”
In fact, “oftentimes, Dash is more used than even Bitcoin on some of the payment platforms that we’re integrated into down there.”
Because of all of this, Ryan said that he believes that “people do recognize the value [of Dash], and we’ve been getting consistent growth in our transaction counts every quarter for the last two years. We’ve really seen a great deal of ‘real world’ adoption that a lot of other cryptocurrencies just don’t have.”
Indeed, beyond Venezuela, Ryan explained that Dash does have “communities in other locations around the world where there does seem to be some level of concentration: some examples are Thailand, certain countries in Africa.”
“Outside of that, we’ve seen some usage within certain verticals: one of those is gaming. We’ve recently been integrated into a platform called ReadyRaider. It’s a tool that allows guilds of players that cooperate within a game to track what their spoils are from ‘conquering enemies’ and so on, and being able to split them up among themselves.”
Dash is "often the fastest way to deposit value onto an exchange," Ryan Taylor says
Additionally, “we’ve seen tremendous growth in trading,” Ryan continued. “Because Dash is instant, and we’ve had that instant feature integrated into a number of major exchanges...a number of exchanges honor InstantSend deposits--they do deposits within two seconds.
Therefore, “Dash is often the fastest way to deposit value onto an exchange,” Ryan said. “So, if you’re doing arbitrage trading, or if you’re looking to rebalance your assets between two different exchanges--using fiat through the banking system, that takes days; using any other cryptocurrency can take an hour or two. Using Dash, you can rebalance within a few seconds.”
“So, we’re seeing more and more usage within the trading space--that gives Dash better liquidity, and it helps us to have fuller order books on the exchanges. That’s really beneficial to everyone.”
This is an excerpt of Finance Magnates’ interview with Dash Core Group CEO Ryan Taylor. It has been edited for clarity and length. To hear the full interview, visit us on Soundcloud or Youtube. Special thanks to Ryan and to the DCG team.
