Pros/cons of the top 10 cryptocurrencies in market cap everyone need to know (2): DASH & NEM

Overview

This is to continue on the first article on this topic, introducing and comparing the top 6th and 7th cryptocurrencies in market cap. This time I use bullet points to list out the properties. Hope it can be more readable:)

Current market cap rankings and information can be found here. Note that this is my personal view and observations and should not be considered as financial advice.

Story begins

6. Dash(DASH): Digital Cash. It’s primary purpose is being a user friendly digital currency. (reference1 reference2 )

Pros:

  • The token can be used(or is designed) to trade goods, unlike many other currencies that can only be used within their network.
  • The targeted users of DASH is the general public: There are some signs about it, including its name, “DASH — Digital Cash”,which is quite easy to recognize. It is also very user friendly compared to others.
  • InstantSend: Verifies transactions in just one or two minutes
  • PrivateSend: You can choose to send anonymous transactions (untraceable) by using the concept of CoinJoin. A quote from wiki:

It is based on the following idea: “When you want to make a payment, find someone else who also wants to make a payment and make a joint payment together.”. When making a joint payment, there is no way to relate input and outputs in one bitcoin transaction and thus the exact direction of money movement remains unknown to third parties.

  • Has one of the lowest transaction fees

Cons:

  • Still uses the Proof of Work(PoW) algorithm, which is really a waste of computing energy and electricity. I personally thinks that PoW is not a good algorithm fundamentally. It will bring along problems as the network grows(increased blocksize and transactions per second do bog down the system)
  • Scalability problem: Like Bitcoin, the block size is also 1MB currently. This means only a small number of transactions can be processed per block. Although it states that the blocksize can be increased in the future followed by a higher transaction fee, this does not solves issues such as there won’t be enough storage capacity soon if the network keep growing with the same block growth rate and an increased blocksize, revealing that this is not a long term solution.
  • A large amount of tokens are locked up (It is said that the amount of locked tokens is more than the transferrable total token amount). The reason behind is: In order to be a “Masternode”(a node that its owner has a vote for the project changes and can be rewarded about half of the mining reward by performing services such as InstantSend and PrivateSend), one has to have 1000 DASH deposited. This shows that a large proportion of the current market cap is not the money that is circulating and being used in the network.
  • The PrivateSend service has some skeptical reviews and concerns(referenced here). The coin mixing strategy of PrivateSend depends a lot on the number of active users, and many of the users complain about the slow mixing process.

7. NEM(XEM): A new blockchain project that is NOT based on Ethereum. (can be viewed as an alternative to Ethereum)

Pros:

  • NEM is overall improved by writing the code completely from scratch in Java: It can handle 3000 transactions per second, while only 3 to 4 transactions can be processed per second in Bitcoin.
  • Introduces “namespace”: Namespace is like a domain name system that can be used to create a unique place and subdomains for businesses.
  • Use the new Proof of Importance(PoI) algorithm: Compared with Proof of Work depending totally on hardware mining abilities, this algorithm takes into account how many transactions are made and the total token amount in an address. This incentivizes coin holders to carry out transactions, which helps the growth of the network in the long term.
  • Have a special messaging feature. No XEM needs to be sent in order for a message to be sent. Transaction fee of sending a message is also calculated in a different way(low cost compared to traditional messages that can be added in a block). For unencrypted messages, it charges 1 XEM for every 32 charactersm while the price for encrypted messages varies.
  • Have its own wallet (the Nano wallet, simply click and download). It can be set up quite simple and fast(uses your browser window to open the wallet), but still not that user friendly for generic public. (A quick demo video)
  • Everyone having 10000 XEM can start mining(called “delegated harvesting”): This incentivizes regular users to contribute to the network. All these harvest can be done within the Nano Wallet. Only a normal computer is needed to start mining.
  • I could barely search of its drawbacks when doing researches online XD

A simple analogy referenced here states that NEM to Ethereum is like WordPress to HTML.

Cons:

  • The official website is still not easily understandable for standard users. Mass adoption is less likely to happen if people are not well educated with NEM’s features.
  • As Ethereum is widely accepted and has no significant drawbacks now, it is hard to see people switching to NEM. The number of users is something to concern about.(I personally will stick to Ethereum for development, but will keep an eye on NEM.)

(Rank 8th to 10th will be continued in the next article)

Wrap up

Now you have an overview of two of the most popular projects. I tried to include every features they have and gain insights from as many resources as possible(too many sources to list out). Great thanks to all the authors writing on related topics. Hope my article does help people who want to take a deeper look into these projects.

Any feedback on how I can improve or thoughts to these two projects will be much appreciated! Your likes and reviews are my greatest motivation;)

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