Key Insights:
BlockDAG is a crypto project that uses the DAG protocol, which is considered an evolution of blockchain technology.
DAG-based projects are often faster and have higher transaction throughput than ordinary blockchains.
However, since they are relatively new, most projects lack sufficient testing in real-world conditions.
A few top DAG projects include BlockDAG, Hedera, Kaspa, IOTA, and Nano.
Directed Acyclic Graph is a non-linear decentralized network that adopts blocks parallelly to achieve a lot higher transaction speed than any ordinary blockchain.
BlockDAG is one such project using the directed acyclic graph to record blocks of transactions rather than the linear blockchain format. As a result, it has a much higher speed and much faster block confirmation than traditional blockchains.
It differs from a blockchain with respect to transaction confirmation, consensus mechanism, and a few other things. However, a DAG can perform all the tasks that a blockchain does and in a much more efficient manner.
A concern around DAG technology is that it remains largely unused, and as a result, there could be significant vulnerabilities that are not yet discovered. More usage of this technology would result in discovering more loopholes and drawbacks, which would serve to make it better over time.
DAG technology has several advantages over blockchain technology, being a lot faster and much more decisive in terms of block selection. This leads to a low rate of uncertainty from the validators' point of view, a high block processing speed, a high rate of transaction throughput, and faster finalization.
DAGs process blocks in the same way as a blockchain does but are much faster in finalizing them. This is because they adopt all blocks on their network as compared to blockchains, which only choose the best
All of these make DAG a superior technology as compared to blockchains.
The only successful project using a technology similar to DAG is Hedera Hashgraph, which uses its own patented Hashgraph Technology. Hedera works on a gossip about gossip protocol which essentially links a piece of information to multiple notes, at the time of recording it so that there are multiple witnesses for the same before someone can dispute its authenticity.
The only criticism this technology faces it its IP rights, which violate the principles of decentralization, unlike Bitcoin, which is open source and available to all to copy, modify, or redistribute. Even corporation-based projects like XRPL developed by Ripple Labs is open source.
Centralization also makes it impossible for others to connect freely with Hedera, and currently, there are only 39 validators, too, run by giant corporations like Google and IBM. Public participation as validators is unavailable in this case.
All of these essentially make Hedera a private and permissioned blockchain.
BlockDAG is the most well-known project working on DAG technology. It is in its pre-sale stage and has raised $210 million to date. You can buy it from its official portal.
BlockDAG
BlockDAG
IOTA uses a DAG structure that is primarily focused on IoT transactions as the end terminals (devices). These terminals use IoT and tend to generate a lot of transactions.
IOTA Price Trends Over the Last 7 Days
Coingecko
At present IOTA was trading at $0.17, almost 18% down since the last week.
Hedera is the largest project on the DAG technology and is used for corporate applications, with leading firms like Google and IBM working on its protocol. It is slightly different than a traditional DAG and works on a proprietary "Gossip-about-Gossip" protocol.
Hedera Price Trends in the Last 7 Days
Coingecko
HBAR, the native token of Hedera was trading at $0.16 with a $16 fall over the last 30 days.
Kaspa is fully based on the DAG protocol that successfully combines the Proof of Work algorithm with DAG, something that was previously thought to be non-compatible.
Kaspa Price Trends in the Last 7 Days
Coingecko
At press time, KAS was trading at $0.06 with a 16% fall in price since the last week.
Nano is a fee-less instant cryptocurrency transaction network that uses its own version of DAG called the "Block Lattice".
Nano Price Trends in the Last 7 Days
Coingecko
XNO was trading at $0.85 with a 21% fall in price over the last 7 days.
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