DUSK – A Complete STO Ecosystem with Unlimited Scalability
In our last article, we just started a small series about STOs. The first part explained what STOs are, and taking it from here, we are going now over some tokens which might be successful in the upcoming future, once the ball starts rolling. Today, we are going to start with a relatively unknown project, that did not hit the exchanges yet: DUSK. Breaking it down, DUSK has the following goals:
- DUSK aims to be much more than just another altcoin.
- The DUSK network is an ecosystem focused on the ownership and trading of
- Built on the Segregated Byzantine Agreement consensus algorithm, DUSKS’s
technology is not just impressive, it suits the goals of the ecosystem perfectly- and
these goals are indeed rather ambitious.
- In addition to secure, decentralized and anonymous payments, DUSK also
provides a second layer solution for the transacting of tokenized securities and
digital asset ownership, as well as low-latency communications and data transfer.
The 2018 crypto bear market has not just been a massive wakeup call for the get-rich-quick crowd, it has also served as a catalyst for progress. Out of the cauldron of hurt it brought about, sprang forth blockchain initiatives that carry actual value, and offer actual solutions to actual problems.
DUSK is one such initiative, and if its white paper is to be held an indication in this regard, its impact – though probably a niche one – may indeed be significant, in terms of ushering the securities trading industry into the future. That said, to understand what DUSK does and how it accomplishes these daunting
goals, one needs to know/understand what an STO is.
What is an STO?
Security Token Offerings are often hailed as the evolutionary iterations of ICOs – but they are of a rather different nature. STOs are based on tokenized securities and these tokenized securities work exactly as “regular” securities do: they have value and they are tradable. Stocks, bonds, options and futures are all considered to be securities and as such, they are subject to regulation by the competent authorities (in the US, the SEC – Securities and Exchange Commission is the securities regulator).
The tokenized securities offered through an STO can indeed be the tokenized versions of stocks, bonds etc, or of any other assets.
STOs do not revolutionize securities, but rather the way they are sold/traded. Bad investments remain bad investments whether they’re peddled through an STO or not.
By putting securities onto a blockchain, liquidity can be improved (24/7 trading becomes possible) middlemen can be eliminated, management can be handed over to smart contracts, and the whole investment process can be optimized and simplified.
Where does DUSK fit into this picture?
Despite the above-listed advantages, most STOs fall woefully short of the mark on several accounts.
- they usually operate off fully open ledgers, chucking privacy and all concerns linked to it, right out the window.
- while they could indeed eliminate middlemen through decentralization, they are usually centralized and thus employ the services of a middleman – an off-chain one, no less.
- due to this type of centralized setup, secondary market adoption (one of the main draws of the whole concept) falters, and scalability is nipped in the bud.
- the above considered, it is clear that most STO platforms offer way less than they could/should, and they usually charge too much for it.
The DUSK ecosystem is decentralized, and accessible for organizations of all financial means. It is fully scalable, automated, compliant and confidential.
While those last two attributes may seem mutually exclusive – according to its white-paper – DUSK has managed to marry them off. In fact, the whole STO
regulatory framework compliance is handled on-chain by the ecosystem – which translates to no middlemen and reduced costs.
The DUSK ecosystem is comprised of three main components:
- a payment system/native cryptocurrency (DUSK), which addresses
unidirectional value-transfer needs.
- a bi-directional value-transfer system – which handles the tokenized securities,
their trading and asset-ownership in general.
- data streaming/communications capabilities also deemed essential for the
seamless transaction of security tokens.
This explains why DUSK is much more than a mere “altcoin” and it also drops a number of clues about the potential/value that it brings to the table of the securities trading industry.
Unlike more mainstream cryptos – which use Proof of Work and Proof of Stake mechanisms – DUSK has adopted a brand new – and radically different – adaptive
consensus approach, which is indeed fairer than PoS and much less computational- intensive than PoW.
SBA (Segregated Byzantine Agreement) – which provides Dusk protection from double-spending – is derived/evolved from the CryptoNote protocol.
It makes use of specialized nodes called Provisioners, which handle all the computationally-intensive tasks of the network, while not competing for block-
More specifically, Provisioners handle verification, voting, and notarization, in addition to state channels for communication and distributed storage.
Secure Tunnel Switching – a cryptographically secure method – is the technology used for peer-communication.
Only normal, transactional nodes are allowed to compete for block-generation. The native currency of the network, Dusk is used, every time a transactional node
becomes a block-generation candidate. The actual process of voting and awarding the block-reward is described in detail in the DUSK white paper, and it is a very interesting read indeed, which offers proper explanation concerning what one might call the “unique selling point” of this crypto/ecosystem.
The Dusk digital currency is used to incentivize/reward participation in the network (the nodes do have to be run by someone), as well as a means of payment for the services rendered. Dusk is untraceable, unlinkable, and – thanks to SBA – boundlessly scalable.
As stated above, with Dusk, crypto-owners get much more than a shallow investment opportunity. They effectively become parts of a fully-fledged digital
ecosystem which may indeed become the future of the securities trading industry.
There is certainly value and potential in this one, and though – at first glance – Dusk’s ambitions may seem like niche ones, the system is not solely focused on the
confidential transfer of tokenized digital assets. It also excels at private and secure data transmission and communications, as well as private and confidential – as well as allegedly compliant – payments. The token is not yet traded on an exchange as far as we know, but we would make sure not to buy the initial pump once it gets listed.