Dashians misconceptions about dash

This post assumes knowledge of dash, for an introduction to dash see Amanda B Johnson’s video series. Every major crypto could have a post like this written about it. I care about dash and believe in its potential so I am writing the dash version.

I notice my fellow Dashians in person and online, spouting what I consider to be at least partial misconceptions about dash.

Misconception: Masternode operators vote wisely

I am a masternode operator, I met several masternode operators at the Dash Open House and I talk with a lot of masternode operators online.

We have very little understanding or insight into the proposals we vote on. If we vote on proposals at all its mostly by

  • Gut feeling.
  • Our perception of the reputation of the proposer.
  • Groupthink. We see other people making negative/positive comments or up-voting/down-voting a proposal and we follow the crowd.

I think more than 50% of all treasury funds that have been paid out for proposals, other than to Core, have been wasted. Prediction markets could help but the real solution is to pay treasury funds after projects have delivered and to have treasury bounties.

Misconception: Dash is the easy to use payments crypto

I am fully on board with the evolution roadmap and philosophy but a lot of Dashians talk about where we hope to be in 3-5 years as if we are already there now.

People say dash is easier to use than other cryptos. As of right now, it’s not. We hope it will be but today its pretty much equally difficult to use as any major crypto.

The same applies to the idea of dash being the payments crypto. That is what we want to be, not what we are today. Yet at conference after conference dash representatives present their hope for the future as if it’s already a fact.

Misconception: Dash has wider distribution than other major cryptos

Dash fans like to say that dash has a wider distribution due to stats like the top 100 dash address only hold ~14% of the money supply, compared to;

  • Bitcoin 19%
  • Etherium 34%
  • Litecoin 44%

This is of limited relevance given that dash will appear more distributed than it is. Due to the masternode system dash whales have a strong incentive to split their holdings into separate addresses with 1000 dash each. This is not the case for any other major cryptos.

Misconception: Dash has solved governance

The dash governance system with the treasury, DAOs and masternode voting, is the best governance model in crypto. However, it is not a guarantee against all possible governance problems.

Compared to other cryptos the dash governance system is more complicated with more moving parts. This gives it the potential to do more. It also gives the potential for more governance issues as the below examples demonstrate.

There could be a governance crises in dash that causes a coin split or devastates the project. People counter that governance disputes will be settled by masternode votes (remember, we are the people who have very little insight or understanding on what we vote on). Here are a few possible cases where that might not work.

1. Masternodes vote in favor of a proposal and Core refuse to release the funds. Dash Core CEO Ryan Taylor has discussed this exact possibility saying if the masternodes voted to fund something illegal, like a new Silk Road, Core would not allow it.

Edit: Part of the budget finalization procedure used to need manual action that was usually taken by someone from core. This is no longer the case. Also Ryan Taylor might have been saying if masternodes voted for core to do something illegal like build the next silk road then Core would refuse but if this was done around core they could not stop it.

2. Research shows we only need to give 35% of block rewards to miners to provide more than adequate security. Masternodes agree and vote for the change. Miners credibly promise if the change happens they will abandon the network in unison, make a competing chain and attack and kill the main/legacy chain.

In this case, does he who controls the spork control the future? Or since managed masternode services run most of the masternodes does it depend on what software the biggest masternode hosts (Moocowmoo, Splawik,  and Node 40) chose to run?

3. Core turn evil. Today people say “if core turn evil we can defund them”. This will sound very naive if it ever gets to that. We will not all agree if or when Core have turned evil. Core are funded for months in advance and the damage an evil Core could do before being defunded or despite being defunded could be devastating.

Having a powerful governance structure in place gives us the responsibility to continue to spend more time and effort on improving governance than other cryptos do. We must keep working to make dash governance more robust and less centralized, while guarding against making it too complicated for people to understand.

Let’s learn from bitcoin’s mistakes

One of the main catalyst for bitcoin’s problems in 2017 (no scaling, high fees, paralyzed development and contentious hard forks) was the lack of frank discussions about bitcoin’s potential problems within the community before those problems became serious.

When you are being attacked from the outside it’s easy to ignore all tough questions and only pay attention to like minded people.

In the bitcoin community in 2014/15 everyone just wanted to shout “RAH RAH RAH! TO THE MOON! ANDREAS ANTONOPOULOS!”. This made bitcoiners feel good about their investment and encouraged others to get on board. However it did not prepare the project for the inevitable challenges ahead.

Let’s try not to do that in the dash community.

8 Comments

  1. Joel Valenzuela 1 year ago

    Pretty good and fair overall, and I agree that even the best things must be constantly made better. I do want to clear up some misconceptions about these misconceptions, however:

    1: Masternodes vote to fund some bad ideas, but are getting better. Part of the beauty of Dash’s governance is its simplicity, so we don’t get a DAOsaster. A simple but solid system is a great thing to build detail on to later. As we speak, different groups are getting together systems of evaluation to get the masternodes the most informed experience possible to do the best job. In other words, over time this problem is solving itself.

    2: That definitely depends on your idea of “ease of use.” Dash has plenty of efficient wallets on par with those of Bitcoin, so thus far it’s equal. A big part of ease of use is transaction times and fees. If with Bitcoin you have to wait at a minimum 10 minutes and pay several dollars to send, and with Dash you pay a few cents and it goes through instantly, that’s certainly an ease of use improvement in my book.

    4: a) Invalidated by the edit.
    b) Why has this situation not happened yet? Probably because it’s completely hypothetical. Remember, the balance of Dash’s governance is there for a reason because economic incentives are aligned. Why would masternodes commit suicide by trying to screw the only other actors in the ecosystem who can really harm them? Answer: they won’t.
    c) This is one of those “but what if super space dinosaurs with lazer bazookas come down from the sky and kill everyone?” kind of questions. What happens if Bitcoin Core turns evil? Oh wait, that happened, and yes, the damage was immense. If Dash Core did the same, not only could they be defunded, but a competing team could be assembled, agreed upon by clear consensus, and funded immediately. Of course there’s a couple bumps in the road, but it’s much, much smoother than anything in other coins. More importantly, because of the economic incentives so well aligned, this situation is unlikely to happen. Which is mostly why it hasn’t.

    • Author
      BitEdge 1 year ago

      2: So in that regard equal to Ethereum, Litecoin, Bitcoin cash, et cetera.

      • Krish 1 year ago

        No, because Dash has InstantSend and none of those other coins do. They might be fast (a few minutes), but they aren’t instant.

        • Author
          BitEdge 1 year ago

          I am not sure if that is an ease of use feature. For one thing a lot of dash wallets, particularly mobile wallets, dont support it. It might help in brick and mortar retail but I, and most dashians, have never used dash in that context.

          • solarguy 1 year ago

            “a lot Dash wallets, particularly mobile wallets, don’t support it.”

            While true, I would add that they don’t support it…yet. For cryptocurrency to actually act like money, it has to have that near instant feature. Thus we have an actual functional product, and the money in the treasury to facilitate various wallets and exchanges to support that feature. None of the other coins you mention have a Treasury that is overflowing with money, nor do they have a very large and growing dev team. So, kinda the same, but not really.

          • Joel Valenzuela 1 year ago

            Both main mobile wallets, for Android and iPhone, support InstantSend. Additionally both Dash-geared point-of-sale apps support it.

  2. solarguy 1 year ago

    I am reminded of Winston Churchill’s famous quip,
    “Democracy is the worst form of government, except for all the others.”

    I also am a masternode operator. Keep forgetting to sign up for my badge, but I digress. I disagree that”We have very little understanding or insight into the proposals…” Does every MO know every cogent fact about every proposal. No, of course not. But as a group, there’s always somebody (and most likely several somebodies) that have insight into that particular topic. And the various forums give us a chance to talk about x, y or z proposal. I think on the whole, we have done pretty well with the treasury money, and I would challenge you to show me 50% waste in specific proposals that were a flop.

    However, I agree with your premise that we could do better and we should do better. The beauty of the free market is that, as new needs come up, new solutions will present themselves. Don’t be too hard on yourself and the whole MN community. This form of governance has never existed before. We have permission to stumble a bit as we get our bearings.

    One thing that I think would be helpful is a dedicated forum just for the Masternode Operators. As it sits now, it’s hard, or impossible really, to have a conversation just among the MNs. As that community develops and gets to know each other and gains experience, there are any number of improvements we could make. I’ll give you just one example.

    There could be specific instances when the MN community really is pretty thin on the knowledge base. As a community, we could identify 6 or 8 or 20 experts/consultants that cover 99% of the kinds of things the community is weak in. As the new crop of proposals come in, we identify the 2 or 3 or 10 things we would like to know more about and we agree as a group to spend a couple hundred bucks to get an opinion from a lawyer that specializes in crypto, or a private investigator that specializes in verifying that Bob really is who he says he is online, and that Bob is an upstanding citizen, as opposed to a felon convicted of several securities related fraudulent schemes.

    Finest regards,

    solarguy

  3. Joshua Seigler 1 year ago

    “Masternodes vote in favor of a proposal and Core refuse to release the funds.”
    Core doesn’t control budget funds’ release. Core only spends from their own funds that the budget system has allocated them.
    “Dash Core CEO Ryan Taylor has discussed this exact possibility saying if the masternodes voted to fund something illegal, like a new Silk Road, Core would not allow it.”
    Ryan said that if the masternodes voted insisting that core team do something illegal, they would refuse. Core would have little recourse if the masternodes voted in a proposal for some illegal activity, since the funding would come directly from the superblock.

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