What is a DAG-Based Cryptocurrency - and Why It Matters
The term “blockchain technology” is overused now, and its definition has become diffuse, in the best of cases. We tend to associate it with anything related to cryptocurrencies, or that uses their underlying technology, but the truth is that a blockchain, as such, is just one type of structure that cryptocurrencies can use as a building block. Other structures exist, like the Directed Acyclic Graph (DAG).
We can’t say one structure is better than the other, but they pursue different goals and offer different things. Let’s learn a bit about this.
How Does a DAG-Based Cryptocurrency Work?
As its name suggests, a ‘block-chain’ records transactions inside “blocks” of data that are added one after another in strict chronological order. They have different ways to reach consensus to ‘approve’ transactions; the most popular ones being with miners (Proof-of-Work/PoW) or “validators” (Proof-of-Stake/PoS). Bitcoin and Ethereum are blockchains. DAG-based cryptocurrencies, like Obyte,...
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