Understanding Directed Acyclic Graphs in the Blockchain Landscape

The more time you spend in the blockchain and cryptocurrency industry, the more you encounter some fairly arcane technologies and their accompanying terminologies.

Blockchain technology, which started out as a simple immutable record composed of blocks of data, is constantly evolving.

Although the broader tech world operates similarly, the blockchain and crypto sector moves at a much more rapid pace.

Firstly, let's distinguish between "Blockchain" and "Distributed ledger technology." A common misconception is that blockchain technology and distributed ledger technology are the same.

For the purposes of this article, we'll keep it simple and establish that blockchain and distributed ledger technology, or DLT, are not interchangeable terms.

Blockchain stands for a shared, immutable ledger for recording transactions, tracking assets and building trust.

A DAG protocol is an alternative to the traditional blockchain and can be categorized as a distributed ledger technology.

Many see DAG technology as the next evolution of blockchain as it can help resolve speed and scalability issues and offer lower transaction costs.

Unlike blockchain technology, individual DAG transactions are linked to one another directly rather than joined together in blocks and processed.

A difference between all three is that Hedera and IOTA use PoS or something similar in block generation, while Conflux uses PoW.Clearly, there is no standard approach or official guideline when it comes to blockchain development.