DASH Mining Guide: How to Mine DASH Cryptocurrency

In this guide we explain how to mine the DASH cryptocurrency, including the hardware and software required to mine DASH profitably.

DASH is an open source peer-to-peer decentralized digital cash that is heavily focused on the payment industry. Launched back in 2014, DASH was previously called “Xcoin” and later “Darkcoin” before finally landing the name DASH. Dash has near instant transactions (using InstantSend), privacy (coin mixing through PrivateSend), and security, as transactions are confirmed by 200 TerraHash of computing power and over 4,500 servers hosted around the globe. DASH is one of the first Decentralized Autonomous Organizations (DAOs), as it was the  first self-funding and self-governing protocol. All of this is possible with the implementation of Masternodes. DASH is in the top 15 cryptocurrencies by market capitalization (USD$3.98+ billion), with a current price of USD$ 504.57 and a max supply of 18,900,000.

DASH Mining & Consensus Mechanism

DASH utilizes the Proof-of-Work (PoW) consensus mechanism and the X11 hash algorithm created by Dash core developer, Evan Duffield. The X11 algo utilizes a sequence of 11 sequential hashing algorithms and was intended to make the creation of X11-based ASICs much more difficult. In the early years, this allowed the cryptocurrency to develop and build a community around the project before mining centralization became a problem and Ibelink created the first X11 ASIC miner. It also requires less computational power and energy consumption compared to Bitcoin’s SHA-256 PoW algorithm. You can read more about the X11 algorithm here.

DASH also uses an open-source algorithm that adjusts the mining difficulty, called Dark Gravity Wave (DGW). This results in the difficulty level being adjusted every block instead of every 2016 blocks, like Bitcoin. We are now on version 3.0 of DGW, which has been improved to alleviate previous issues with time-warp exploitation, floating point accuracy and difficulty retargeting.

DASH mining utilizes a two-tier network of masternodes and miners. Like Bitcoin, DASH utilizes regular nodes to maintain and secure the network via transaction verification, block, and currency creation. Masternodes perform specialized functions or transactions like InstantSend for instantaneous transactions, PrivateSend for transaction anonymity, decentralized governance, decentralized payment processing via Dash Evolution, and also providing voting rights. Masternodes are critical to the ecosystem. There are three key elements required to set up and run a masternode which include;  owning and storing 1000 DASH coins, a Linux server or Virtual Private Server (VPS) , and a DASH wallet. The 1000 DASH is essentially used as collateral to prevent sybil attacks. You will need to maintain 1000 DASH in your wallet to run a masternode. Falling below this amount will remove your masternode from the DASH network.

Below is a visualization of the masternode payout structure. The ROI decreases at an annual rate of 7.14% 

Courtest of http://dashmasternode.org

The block reward structure is quite different with DASH as well, compared to Bitcoin or other PoW-based cryptocurrencies. The reward is divided into three parts:

  1. 45% of a block reward goes to the miner
  2. 45% of a block reward goes to the masternode operator
  3. 10% goes to the “treasury” or network pool (these funds are used to payout network contractors looking to create proposals to improve the DASH ecosystem).

ASIC miners are the only way to profitably mine DASH and receive block rewards. Let’s take a look at some of the top miners on the market.

DASH Mining Hardware

DASH miners keep the network secure by verifying transactions and creating new blocks to be added to the blockchain. Mining is competitive so its key to have the most profitable hardware if you choose to mine DASH. CPU and GPU mining are no longer profitable, so keep your focus strictly on ASIC miners. There is currently only one ASIC miner worth purchasing to mine DASH. This is the AntMiner D3 produced by BitMain. BitMain miners are known to provide peak electrical efficiency. New ASIC miners are expected to be released for DASH mining but there is no current timetable for this. If you are interested, it would be worth doing some research and keeping an eye out for any new DASH ASIC miners, as once they become available, expect them to be hot commodities and be very difficult to obtain. Keep in mind you will also typically need to purchase a Power Supply Unit (PSU) separately as it is usually not included with the miner.

ASIC Miners

Antminer D3

Price (USD)

$500 - $3000 (depends on condition and if used or new)

Hashrate (GH/s)

15

Power Usage (W)

1200

DASH Cloud Mining

If you don't want to deal with the problems and expenses related with purchasing equipment to mine DASH, you should do some due diligence and look into cloud mining, where shared processing power is used to mine different cryptocurrencies. Due to energy costs, these remote mining farms are located in low energy cost countries. You can rent hashpower from these farms in set amounts or contact your mining farm for custom hashpower packages in exchange for fiat currency. The following are a few points of interest and detriments of cloud mining.

Cloud Mining

Advantages

Disadvantages

Don’t have to deal with the noise created by miners

Risk of fraud or not receiving payouts

No spike in electricity bills

Risk of mining operation shutting down due to financial loss

Not left with expensive obsolete hardware when mining becomes unprofitable due to updated hardware

You have less control and flexibility in terms of optimizing miners (i.e. software type, overclocking etc.)

DASH Mining Software

The software used to mine DASH is not the same as other cryptocurrencies. Since solo mining is not profitable, you will want to join a mining pool, so look for reputable mining pools to join. Below are some good reference points you will need to know:

You can find an existing DASH P2Pool are near you here. Look for good ones that have favorable ping times and fees.

The code to setup your own DASH P2Pool is here

A link on how to setup a DASH P2Pool Node here

Also, you will need to make sure you have a wallet setup to hold your DASH coin. You can find the best DASH wallets here. There are official desktop wallets and mobile wallets that can be used to store DASH coins.If you don’t plan on holding large amounts of coins, a web or desktop wallet is more than suitable. If you do intend to hold large amounts of coin, the best and most secure way to hold your coins is in a hardware wallet, so a Ledger Nano S or Trezor will be your best option. 

DASH Mining Difficulty & Profitability

The total global hashrate for DASH has slightly decreased over the past 3 months but the daily rainge changes significantly as you can see by the constant spikes in the chart below. The hashrate is related to the price of the coin, and difficulty closely tracks the hashrate.  The X11 algorithm is a relatively easy algorithm to mine compared to other cryptocurrencies. That being said, it may not be as profitable as it was once was before the introduction of ASIC miners, when it was a less popular coin to mine. The profitability is not as high as in previous years as it has steadied off with the rise in DASH mining over the years. Dash is relatively not as attractive a coin to mine but this should change as new Dash ASIC Miners hit the market increasing the hashrate and profit potential. Also, the DASH coin could see significant price increases as we approach a bull run in the overall crypto market. So price appreciation may also play a key in your decision on whether to mine DASH or not.

The difficulty level indicates the amount of computational power required to solve the next block within the 2.5-minute interval. The difficulty level for DASH has typically been unstable, so to maximize profits, you will want to pay attention to the daily difficulty trend and turn off mining when the difficulty is at its peak. You could also switch to mining other cryptocurrencies that use the X11 algorithm during peak DASH difficulty. As the difficulty level drops it requires less computational power and energy to mine the next block and receive the block reward. 

 

 

Below is a chart from cryptocompare that can be used to gauge different profit metrics, once inputs are entered based on your specific hardware. As a disclaimer, this is for illustrative purposes only and results can vary. It is also based on a DASH price of USD$ 504.57

Dash Profits (USD)

Hash Power

(GH/s)

Power Consumption (W)

Cost per KWh ($)

Pool Fee

Profit/ Month

Profit/Year

Profit Ratio Per Day

DASH - 1 AntMiner D3

15

1200

0.12

1%

$31.21

$379.71

30%

DASH - 5x AntMiner D3

75

6000

0.12

1%

$156.02.

$1,898.27

30%

DASH - 10x AntMiner D3

150

12000

0.12

1%

$311.99

$3795.83

30%

Do your research and use the calculator to estimate your total cost and profit potential.

If you have any questions about DASH mining hardware or software, please feel free to comment below and let us know.