Financial transactions involve sensitive information, and there is an increasing demand for a blockchain that can provide secure and confidential transactions. As such, there is a need to protect sensitive data, and this necessitates the development of a privacy-oriented blockchain that can handle confidential transactions in compliance with regulatory standards.

Developed to address the unique challenges facing confidential blockchain transactions, Dusk Network has emerged to deliver a robust platform for issuing digital securities and personal assets. As the realms of finance and privacy combine in the digital age, this article examines Dusk Network, exploring its foundational technologies, use cases, and the pivotal role it plays in reshaping the landscape of decentralized finance.

What is Dusk Network?

Dusk Network is a privacy-oriented blockchain designed for financial platforms. It provides regulated and decentralized finance services such as financing, trade automation through smart contracts, and outsourcing of costly processes for businesses. This project aims to be a blockchain protocol built for deploying programmable zero-knowledge dApps, thus positioning it as the foundation for an open and decentralized dApp ecosystem.

Dusk Network provides automated protocols that help boost transaction speeds and reduce liquidity fragmentation (when trading occurs across multiple platforms or markets, leading to a lack of centralized liquidity). Its users will have access to a full spectrum of financial services, such as securing capital and trading assets. They can access these assets directly from their wallets while retaining self-custody.

Dusk Network provides a privacy layer for financial instruments like securities and bonds. One of its primary objectives is to facilitate the tokenization of securities in accordance with regulatory standards. As a result, Dusk Network creates its own standard of tokens that can be used to develop programmable security tokens with decreased automation costs. These tokens can represent votes, dividends, and other values that can be easily integrated with large-scale business operations.

History of Dusk Network

Dusk Network was created in 2018 by co-founders Emanuele Francioni, Fulvio Venturelli, Jelle Pol, Pascal Putman, and Mels Dees. The first version of its whitepaper was also published in the same year. In 2019, Dusk Network listed its native token DUSK as ERC20 and BEP-2 tokens on Binance, Bitfinex, and Bittrex Global exchanges and implemented its first publicly available testnet. That same year, the second version of the whitepaper was released.

Since its inception, Dusk Network has partnered with other industry giants, including Huobi Capital, Kucoin, and Gate.io.

How Does Dusk Network Work?

Dusk Network is powered by its Segregated Byzantine Agreement (SBA) consensus protocol, which is considered an upgrade over the underlying proof-of-stake (PoS) mechanism. It combines decentralized functionalities like discrete stake amounts, random cryptographic sorting, and a track record module to increase the likelihood of picking good nodes.

An interesting feature of the SBA protocol is that once a certificate is created, it cannot be reversed. This is because the voting power constantly shifts through all the validators in the Dusk Network, ensuring that each transaction is completed quickly in less than 10 seconds.

Instead of using computing power, validators on the Dusk Network lock their DUSK tokens. In return, they can vote on blocks that can be added to the blockchain. The voting is divided into three stages: Block generation, reduction, and agreement.

Block generation involves determining the round leader and proposing a candidate block. Afterward, block-reduction comes in to produce an agreement on a candidate block, and block agreement terminates the consensus round to start a new one, given that the block-reduction has been successful.

Dusk Network’s validators work together to agree on a specific block for which they can create a certificate, proving that the block is not breaking any rules. This is opposed to the typical layering of blocks on the blockchain after every transaction, just like with Bitcoin. This approach forms the foundation of the Dusk Network project.

Key Features of Dusk: Piecrust, Succinct Attestation, Plonk, Citadel and more

Some of the features contributing to maintaining Dusk Network’s functionality are as follows:

PIECRUST: Virtual Machine

Driven by their vision to facilitate real-world assets (RWA) tokenization, Dusk Network released Piecrust in early 2023 to replace their Rusk Virtual Machine. Piecrust is capable of handling transactions up to ten times faster than Rusk VM.

Piecrust also simplifies smart contract development, as such enriching the developer experience. The ease of use, coupled with Dusk Network’s privacy-preserving capabilities, makes Dusk Network the platform of choice for developers and projects interested in RWA tokenization.

Succinct Attestation (SA) Consensus

The Succinct Attestation consensus mechanism is an innovative and fast Proof-of-Stake (PoS) based consensus with settlement finality guarantees, which is a crucial requirement for financial use cases.

This consensus mechanism secures the Dusk Network by adding transactions to the chain and ensuring completed transactions are irreversible once they are successfully processed.

PLONK: Zero Knowledge Feature

PLONK is one of the latest advancements in zero-knowledge cryptography. Zero-knowledge is crucial for public blockchain collaboration because it allows businesses to issue claims and submit proofs whilst transacting securely and in strict privacy.

It enables the verification of complex computations executed by untrusted parties by transforming programs into circuit representations. The system relies on arithmetization, which converts logical circuits into polynomial expressions.

CITADEL: Digital Identity

Citadel is a zero-knowledge proof KYC solution that allows users and institutions to control the extent to which permissions and personal information are shared. This framework can be used for all claim-based KYC requests and puts users in total control of the information they share and with whom while simultaneously being completely compliant and private.

For example, if a user opens a bank account, they would have to go through a verification process. If the same user decides to go into stock trading, they will then need to open an account with a brokerage service, where they will also have to do a KYC/Anti-Money Laundering (AML) verification process. The user will have to either share the same information or have their bank provide it on their behalf.

As a result, these banks and other players will keep and store the information, which both has a big impact on privacy and puts the user at risk of data leakage.

However, with Citadel, users will store their data with one party who is only able to store and verify data, and other services can opt to accept the licenses and use that as KYC/AML proof. This significantly reduces risk and privacy exposure.

Confidential Security Contract (XSC)

Another key aspect of this framework is the use of native confidential smart contracts. Dusk Network employs its smart contract creation standard called Confidential Security Contract (XSC).

Rusk

Rusk is the virtual machine that enables users on Dusk to program smart contracts and dApps. It also allows users to set parameters for compliance and regulations.

Microkelvin

Microkelvin is a toolkit that makes advanced custom data structures easy to implement for smart contracts.

Zero-Knowledge Cryptography

Dusk Network leverages Zero-Knowledge cryptography for the validation of several network operations, including transactions, service access rights, participation in auctions, and so on. This cryptographic approach enables users to interact with the network without divulging personal identity or transaction specifics while offering evidence of correct computation in a trustless manner.

Verifications of these operations are managed by browser nodes, which compete by staking a designated quantity of DUSK tokens to partake in the block selection procedure. This staking mechanism serves as proof that the transactions within the block have taken place.

Decentralized Consensus

Dusk Network employs a permissionless framework, allowing individuals interested in running nodes to actively participate in the consensus protocol and earn DUSK tokens as a reward. At the core of this lies the SBA protocol, which divides staking full nodes into two distinct roles through a process known as Sortition.

These roles are divided into Block Generators and Block Provisioners, and they play pivotal roles in the transaction validation process. Block generators are responsible for generating the block, while block provisioners validate and add it to the blockchain. The selection process involves a non-interactive ‘Blind Bid’ lottery, where block generators bid for the opportunity to submit a block, and subsequently, provisioners validate and integrate the block into the blockchain.

Trustless Anonymity

Transactions on the Dusk Network can be confirmed in a trustless manner without exposing details of the transaction or its participants to people who are not directly involved in the transaction. This feature is especially important for certain types of asset transfers, and it is a highly sought-after feature for various businesses.

One notable use case of this technology is that it ensures compliance with securities regulations and the issuance of security tokens. This aligns with the needs of various global markets that depend on the anonymity of transacting parties to prevent adverse effects on pricing.

What is DUSK?

This is the native token of the DUSK ecosystem. It is available as an ERC20 and BEP20 token, and it is used for staking and consensus on the network, as well as paying network and gas fees and deploying dApps.

DUSK also serves as a reward for consensus participants. Users can also trade DUSK tokens for any other XSC tokens in centralized exchanges or with atomic swaps. It will also be used for on-chain governance within XSC. Block rewards are also paid with DUSK tokens.

DUSK Tokenomics

DUSK has a total supply of 1 billion and a current circulating supply of 427.61 million tokens. It has a market cap of $47.9 million. It was distributed as follows:

• 50% was sold in a private sale
• 18.1% went to the technical development fund
• 11.8% was reserved for partnerships and exchanges
• 7.3% was allotted to marketing and events
• 6.4% was reserved for the Dusk Network team
• Another 6.4% was allocated to the project’s advisors

News on DUSK

In September 2023, Dusk Network released its updated roadmap to its mainnet launch scheduled for 2024. This recent iteration provided an overview of products and the progression leading up to the launch. Some of these products include

Citadel (SDK)

This privacy-preserving system built on Dusk Network is set to revolutionize digital asset and identity interactions. With this software development kit (SDK), developers could use Dusk Network’s KYC/AML solution to ensure their existing KYC procedure is more efficient and secure.

Piecrust VM 2.0 and Web Wallet

Piecrust is Dusk Network’s homemade ZK-friendly virtual machine. It is the first virtual machine to allow people to build general-purpose, ZK-enabled dApps.On the other hand, the web wallet will serve as a gateway for users to interact with Dusk Network and transfer digital assets on the blockchain.

Is DUSK a Good Investment?

Dusk Network stands at the forefront of blockchain technology, seamlessly blending privacy, security, and scalability. The project positions itself as not just a blockchain but a catalyst for ushering in a new era of decentralized applications (DApps) and financial instruments where privacy is paramount. However, the cryptocurrency market is quite volatile, so it is advisable to do extensive research or consult with qualified financial personnel before investing in Dusk Network.

Take Action on DUSK

DUSK is available for purchase on centralized exchanges like Gate.io. Check out the price of DUSK here and begin trading your favorite currency pairs.

• DUSK/USDT
• DUSK/ETH