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GhostDAG protocol boasts its scalability to automate transaction approval without compromising security. Learn how Kaspa integrates GhostDAG to revolutionize the industry.

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Scalability has always been a challenge for many networks in the crypto ecosystem. Tracing back to 1736, a Swiss mathematician named Leonhard Euler questioned whether walking across all seven bridges of the Prussian city of Königsberg (now the Russian city of Kaliningrad), once and only once on a continuous path, was possible. He concluded that there needed to be an even number of paths in consideration, with one leading to each relevant point and one leading away from each relevant point. 

The Seven Bridges of Königsberg is then considered to be the first application of what would eventually become known as graph theory, a branch of 

. In short, a blockDAG is simply the application of graph theory to the order in which transactions are approved within the chain. DAG, after all, stands for directed acyclic graph. There are no loops in a directed graph, and no cycles in a DAG. The entities completing transactions within the blockDAG act as the vertices of the graph, and the transactions between them as the edges. 

As a cryptocurrency, Kaspa is the first to use blockDAG as a scalable Layer 1, dramatically speeding up the trading process without sacrificing security. Keen to learn more about how Kaspa works? Let's dive right in. 

Within the chain, groups of data, including transactions, that are similar to one another are called clusters. The central datum of the cluster, whether that datum is real or imaginary, is called the centroid. "K" is the user-defined number of centroids required in the analyzed or affected dataset. Another word for "centroid" is "mean." 

 takes the user-defined number of centroids and assigns each datum to the nearest cluster. The idea is also to keep the centroids as small as possible.

GhostDAG uses what's known as a "greedy algorithm" to sort the data, and then put each datum into its proper location. A greedy algorithm accomplishes its task in the best way possible at any given moment, rather than being structured in a certain way. As for clusters, GhostDAG classifies data blocks as either Blue or Red. Blue blocks are on the chain, whereas Red blocks are not. GhostDAG doesn’t try to find the biggest cluster. Instead, the greedy algorithm finds the Blue set with the best tip, and then adds the data from outside the set. The combination of Blues and Reds forms a chain, with the block from the selected tip coming last. GhostDAG utilizes user-defined and mined data to create a topological order in the chain.

The primary concerns Kaspa’s framework is trying to solve are speed and scalability. Traditional blockchains rely on miners to verify transactions. It’s a secure system, but scalability is always the trade-off. 

Kaspa wants to automate the approval process, relying on the GhostDAG protocol while at the same time improving scalability and keeping the network’s security integrity in check. On top of that, Kaspa is also a permissionless network, making it accessible to everyone instead of relying on an administrator as the "gatekeeper" of the network.

In retrospect, the last major problem Kaspa aims to solve is how to provide proof of work securely without sacrificing security. The transactions themselves are secure, but verifying them is a separate task that requires its own programming and set of parameters. One of the ways that Kaspa does this is by 

, whereby the blockDAG is purged of data older than three days. 

By limiting the available data, Kaspa protects itself from what's known as a 51% attack. A blockchain is susceptible to centralized manipulation if more than 50% of it is controlled by one person or group. The rest of the data beyond the three days is stored elsewhere, meaning that a hacker can only get hold of three days' data — and will fail in any takeover attempt.

As a permissionless chain, Kaspa emulates Bitcoin's protections. The encryption method is different, using the KHeavyHash instead of SHA-256-PoW. SHA-256-PoW’s flaws include a need for a weighting function in assessing the priority of data on the chain, but KHeavyHash includes such a function. This means that, in addition to converting data to binary, creating hash values and normalizing constants, certain data therein is assigned a heavier weight than other data. That makes it even more difficult to crack the chain and threaten the security of the process. Chains only present completed and validated transactions, so hashing protects the transactions themselves by preventing fraudulent trading.

Such fraud includes things like double spending, which happens when a user reclaims coins after having "spent" them. Those coins could then be used again to purchase something else, or to pay more toward the first item. Say, for example, that someone needs 100 coins to purchase a car. If the person only has 20 coins, then they could add a program to the system that would pay the 20 coins, reclaim them, and then repeat the process another four times. The security of Kaspa, driven by KHeavyHash, prevents not only this fraud but others as well.

Kaspa associates itself with three different wallets: Mobile wallet, desktop wallet and command line wallet. The command line wallet is part of the core programming, and is generally only for the core team. The most popular is easily the mobile wallet, because it's not only the most secure but also the easiest to work with. It’s intuitive, making it the most user-friendly wallet in the market.

The desktop wallet is more powerful than the mobile version, but it's still easy to install and use because of the 

. That process manager allows a block to be added to the blockDAG once per second.

The pros are obvious: Increased speed, comparable security, and simplification of processes. But upon a deeper examination of the Kaspa network, there’s a problem: The need for more acceptance. Kaspa doesn't appear on any top-tier cryptocurrency exchanges. This relative lack of acceptance, and a relatively small amount of the currency in total has led some experts to opine that Kaspa might be a rug pull. There is, however, no direct evidence to support this.

One of the biggest pros of Kaspa is its meteoric price rise. Just six short months ago, it was trading at about half a cent. Now, it's nearly three times that. The combination of security, speed, and automated ease of proof of work have supported this unusual bullish run for Kaspa's coin. Supporters tout this as "proof of concept" for this small but apparently mighty cryptocurrency.

Like all cryptocurrencies, these coins are used to power the ecosystem and incentivize contributors to keep the data integrity of the platform in check. KAS boasts its utility for transaction fees and developers' payments. Mining node operators receive rewards in parallel to their contributions to the network. Because the transaction rate is just one second, the currency doesn't use large amounts of power supporting many hash functions. Miners can therefore realize a profit relatively quickly on the decentralized blockDAG.

As mentioned, the rise in KAS’s price has undergone drastic shifts since its inception. From its humble beginnings at 1/100th of a cent in late 2021 until now, the number of downturns has been small. Additionally, when KAS has gone down, it hasn't been catastrophic. In fact, during 2022, the high was the aforementioned half a cent, while the low was a quarter of a cent. That's a small range. Now, it's trading at a range of $0.015.

Still, all cryptocurrency trading involves risk. The market, especially the permissionless market, is highly volatile. Despite the small variances in the history of KAS, there might still be a big correction, dependent upon market sentiment. 

As to whether it’s a good investment, the general consensus is "yes." Still, all assets involve risks, and no one can game the system as an honest trader.

Kaspa is a cryptocurrency that has increased its value during its existence, created a new benchmark for transaction speed, and maintained a great level of security while doing so. It relies on parallel blocks for its incredible speed and great security. The mathematics behind its algorithms are sound, based upon almost 300 years of graph theory to order the transactions the right way. 

The blockDAG is a permissionless chain that uses well-designed automated processes to authenticate transactions. As of 2023, it's a good investment that will deliver modest-to-decent gains over time without the real possibility of terrible lows or ecstatic highs. Kaspa seeks to solve the 

 by efficiently and steadily delivering "all three sides" of the cryptocurrency triangle efficiently and steadily. Initial indications are that it has so far succeeded beyond expectations.

Kaspa: A GhostDAG Protocol to Improve Scalability in PoW Projects

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