Dagchain vs. Ethereum | Comparison & Differences

There has been a gradual proliferation of new cryptocurrencies like Ethereum, Litecoin, and Dagcoin since 2008 when Bitcoin was first launched. Several differences exist in these cryptocurrencies and the technology they’re backed by. But in this article, we’ll focus on the pros, cons, and differences between Dagchain and Ethereum only.

The Definition of a Dagchain

Dagchain is the technology backing Dagcoin invented to solve the pain points arising from Blockchain technology. It’s a directed graph data structure operating on a topological ordering.

Its sequence moves from earlier to later transactions and applies to problems relating to data processing, identifying the best navigation route, scheduling, and data compression. Instead of adding blocks to a chain, it uses Direct Acyclic Graph, so every validation is parallelized leading in higher throughput.

All the Dagchain transactions are interlinked, meaning the previous transaction confirms the next and so on. We’ll look into how Dagchain operates and differs from the Blockchain technology.

What Cryptocurrency Stands for

Cryptocurrency is a term for a digital currency using encryption to foster secure financial transactions. It relies on cryptographical functions to carry out the transactions and seeks to leverage the blockchain technology through gaining transparency, decentralization, and immutability.

All cryptocurrencies are an anonymous, secure method of payments operating as a ledger and backed up by a decentralized system of the computing network. Most of them have been hailed for decentralizing financial systems and bypassing currency controls.

However, some have been criticized for being linked to money laundering activities, encouraging criminal go Scott-free and payment of illicit good and services while others have been condemned for resulting in investment” bubbles.”

Examples of cryptocurrencies are Ether and Dagcoin which make use of a similar “distributed ledger system.” Despite this, they’re designed for different uses and differ significantly in design. Unlike Dagcoin, Ether uses Blockchain.

What Ethereum Stands For

Ethereum was invented in 2015 by Vitaly Buterin, a Russian Canadian programmer- the co-founder of Bitcoin Magazine. Ethereum is based on Blockchain technology and uses it for unique purposes. Like Bitcoin, Ethereum is a distributed blockchain network and differs substantially in capability and purpose.

Ethereum Blockchain specializes in operating programming codes of decentralized applications. It also hosts a cryptocurrency known as the ether which fuels its network and is used by application developers to pay for transaction fees plus other services that they adopt

Ethereum is also widely known for hosting smart contracts relying on Blockchain to enforce agreements. This offers unique capabilities to users, allowing them to build the contracts, set up them up automatically and transfer funds after the receipt of good or services by the other party.

Smart contracts execute themselves and handle management, performance, enforcement, and payment. The Ethereum Virtual Machine also runs on the Ethereum network and permits everyone to run different program despite the programming language.

It simplifies the process of building blockchains, speeds it, and supports several applications on the platform. The Ethereum Virtual Machines can be used by developers to create several decentralized applications linked to voting systems, loans, etc.

Problems with Ethereum

Ethereum is highly susceptible to attacks and misuse due to the anonymous nature of Blockchain technology. Regarding misuse, Ethereum has been alleged to be used in promoting Ponzi schemes. In 2018 a Dapp, 333 Eth, was accused of being part of a Ponzi scheme promising users a lifetime ROI. It took 11% cut from investors claiming they would use it for marketing. Several other Daaps like Fomo 3D, FOMO Short, WoWH 3D were accused of running Ponzi schemes on Ethereum

Another shortcoming of Ethereum is that the network gas fees often scale to exorbitant levels while the networks become clogged, worsening the situation. Miner’s processing transactions on the network claim gas fees for every transaction. They, therefore, play a significant role in deciding the average cost of gas.

Transactions with a higher cost attached to them are accepted faster and vice versa because miners prioritize higher returns. When the network is clogged, transactions back up in the memory pool and pending transactions compels miners to prioritize transactions with high gas prices. This results in the scaling of the lowest gas price for confirming transactions.

What is Dagcoin?

Dagcoin is a cryptocurrency offering a new type of Blockchain technology where data is stored and organized using a DAG system instead of Blockchain technology. Dagcoin is unique and different from other cryptocurrencies like Bitcoin.

It was also created to increase transaction speed while cutting down on costs, giving citizens access to money with few limitations and restrictions. This gives them more freedom to carry out transactions while preventing illegal and fraudulent activities. Dagcoin strives to become a widely known digital currency for people to use around the globe

Ether, on the other hand, was launched to establish a decentralized cryptocurrency to be used in developing nations through combating problems caused by falling currency power and snatching power from banks. It seeks to serve as real currency and not a commodity of trade. And its value is safeguarded from speculative fluctuations since it’s based on the Dagchain’s size network.

How Dagchain Differs from Ethereum

Dagchain was invented to be faster, easily scalable, and more egalitarian than Blockchain. It addresses significant problems arising from blockchain technology like costly proof of work, zero scalability, and need for miners.

In Dagchain, each separate block forms their block linked to several previous transactions forming a Directed acyclic graph/ DAG. It lacks the two-tier system, unlike several cryptocurrencies hence miners aren’t tasked with confirming previous transactions. Instead, new network members verify the previous transactions for quick operations.

Dagcoin Complies with AML and KYC Rules and Regulations

Dagcoin complies with AML, KYC and has a government cryptocurrency license to safeguard users from crimes like money laundering and others linked to cryptocurrencies.


Both Dagchain and Ethereum differ significantly in their uses and purpose- Ethereum proves useful for designing smart contracts and running corporate bureaucracy. Dagchain is intended to host a normal digital currency for everyday use. On its way of becoming the cryptocurrency of the future, Dagcoin also educates the masses through marketing by providing knowledge about the benefits of digital currencies.