Tech Review of Dusk Network: A Privacy Blockchain Focused on Security Tokens
Whatsup people, it’s ya boii Nye. Today, I am sharing a bit about Dusk Network. Disclaimer: Dusk Network is one of my clients of my company, Elevated District Media, therefore I have been paid for this review. Enjoy.
What is Dusk Network?
Dusk Network is a compliant privacy blockchain that focuses on security tokens. They have built their own consensus mechanism and use zero knowledge cryptography to combine confidentiality and compliance on chain. Their goal is to remove the expensive middlemen that plague regulated markets, without losing regulatory approval.
Dusk’s Focus; Security Tokens
Dusk is focused on the security token market, and to become the number one blockchain used for STO it’s extremely important to tackle the requirements for compliance and provide privacy of transactions. After all, unlike what most people think privacy leads to confidentiality of transactions which is a requirement in regulated markets. To illustrate why: any movement of funds out of the wallet famously associated with the custodian of the Mt.Gox assets leads to a temporary crash of the bitcoin market. If bitcoin were a regulated asset, the transparency of the bitcoin blockchain would not only be frowned upon by regulators, this would very likely lead to cases of market manipulation which is illegal in most, if not all, jurisdictions. At the same time compliance is an incredibly important aspect, because to own and trade in regulated assets it is legally required to comply with compliance laws. In practice this means that checks such as KYC and AML are important, but also restrictions such as country of the asset holders, amount of assets issued, and other nitty gritty details such as whether assets on the ledger can be fractional, and the time until block finality need to be considered.
What is also extremely important to note is that Dusk Network is a layer 0 protocol, this makes them stand out from all the other solutions like PolyMath, Harbour, Securitize, et cetera which are for profit middlemen that need to make money to be successful. You have to use their platforms and pay their fees. Dusk Network is a protocol, and their confidential security token standard is open to everyone, just like ERC-20 on Ethereum was for ICO’s. It’s also basically free to use, whereas today’s STO solutions can charge you hundreds of thousands of dollars.
How does Dusk technically achieve confidentiality and compliance?
Dusk uses bulletproof technology and their own consensus mechanism to give on-chain confidentiality, they also use stealth address and ring signature to hide sender and recipient. This gives users full confidentiality. And from listening to their tech lead Emanuele it seems that their bulletproof implementation is 5x faster than Monero’s recent implementation. Their consensus mechanism moves away from proof of work and proof of stake. Proof of work is troublesome because of the energy it wastes, and proof of stake is very difficult to keep private because the stakes are done publicly. This is why the dusk team has created their own consensus mechanism and if you read their whitepaper you can see it was done very well. The consensus mechanism also has a node economy that we can all participate in to earn block rewards, and that is actually incentivized for decentralization. Dusk Network combines all of this with the inclusion of KYC/AML approval on-chain, trade restrictions that are encoded on the token level, and much much more.
The team is a good group of skilled individuals, each with an extensive background and expertise. Same with the advisors. I am not going to go through each person, as you can find their credentials via the website.
But I do want to touch of the fact that, on their website, they have split their team into two different sections: one for the tech team and one for the business team. This stood out to me.
While the development of tech is extremely important in the blockchain space, having the expertise to actually run a business successfully is also very important. Both assets are needed in a company and I believe we are seeing some of the older companies fail due to the lack of business/financial knowledge and management.
The fact that Dusk Network has an entire section of the team, each with significant experience, dedicated to building out the business structures needed to succeed gives me confidence.
There are a lot of infrastructure projects coming to the blockchain space, especially over the last 12 months. My initial thought about seeing another one is, do we really need it? Obviously, there can be some doubts about whether we do or do not.
However, Dusk is the only protocol in the security token space, and it seems they have thought about what is required for a network to work, and have a good understanding of their market, whilst building very impressive technology.
This is why I like Dusk Network. While I may not comprehend the full extend of how the tech works (still learning about all this), I do understand some elements of how a business succeeds: one of them being the need for a clear, concise, and focused plan of attack. And while Dusk Network can work for many different use cases, I like that fact that they main focus and priority is only in 3: payments, security tokens, and communications.
This is big for me because I think a lot of blockchain projects are trying to tackle too much at once. And with any startup, a more narrow focus, at least to start, can lead to a more success in the beginning and more clarity as the company progresses. So, I believe Dusk Network is doing this correctly.
I am excited to see what happens with Dusk Network. I believe it has potential and now it all depends upon execution from the team in terms of tech, management, and exposure.
I’m ya boi, Shill Nye. I trade/investigate cryptocurrency full time.
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I do not give financial advice. I am not a financial advisor. If you are looking for financial advice, then you should go to google and look for a financial advisor in your area. The shit I write is simply for entertainment purposes. You should never blindly trust anyone on the internet who tells you where or how to invest your money.
This article contains no advice on buying or selling any assets. This is not a review of an ICO, a tradable asset, or a token. This is purely a review of the tech behind Dusk Network.
Also, I have been paid $6,000 to work with Dusk Network which includes me writing a review, tweeting about them, and helping them with their internal marketing structure, mostly revolved around social media, community building, and messaging. I am working with them as a client.
I do not take clients unless the project peaks my interest and reaches a certain level of personal requirements. Dusk Network met these standards and I feel comfortable sharing this because the tech is interesting, relevant, and could impact the industry. I will always announce clearly if/when I do paid reviews.