Patrick Malara

19 October 2022

What is a Directed Acyclic Graph?

It’s just a graph where a node (vertex) can not traverse the graph in a way where it can loop back to reach itself. That’s what the “Acyclic” part means. Directed means each edge(the connection between vertices) has a direction…

Here’s an image to help clarify:

What does this have to do with Blockchain?

This simple data structure can be applied to create a Digital Ledger. There are two approaches. Each vertex can be a transaction or a block of transactions. A block-based DAG has not been implemented in any production setting.

Constructing a Digital Ledger using a DAG solves several problems prominent in Blockchains. “The DAG introduces two-dimensionality to the otherwise linear or one-dimensional data structure of the blockchain and is a promising approach to make decentralized networks scale” (horizen.io). A Digital Ledger implemented with a DAG will see superior transaction speed due to an increased throughput of nodes, helping resolve the major problem of scalability seen in blockchains.

Which DAG do I invest in to become rich?

The notable DAG cryptos are Constellation, Hedera, and IOTA. It will be interesting to see where Directed Acyclic Graphs go within the world of cryptocurrency. Below are my sources and links for further reading to anyone more curious.

Sources:

https://www.gemini.com/cryptopedia/iota-coin-iota-blockchain

https://hedera.com/learning/distributed-ledger-technologies/directed-acyclic-graph

https://www.horizen.io/blockchain-academy/horizen/advanced/block-dag/

https://drive.google.com/file/d/1GgUaC4MyfsS9LH1goWi0aeZFDQeHnhx3/view