Directed Acyclic Graph (DAG)

A Directed Acyclic Graph (DAG) is an alternative data structure to traditional blockchains, offering a non-linear network where transactions are connected directly to each other without the need for blocks. This structure allows for higher scalability and faster transaction speeds, as there is no need for miners to bundle transactions into blocks. Cryptocurrencies like IOTA and Nano use DAG to handle microtransactions and IoT applications efficiently. In a DAG, each transaction verifies two previous transactions, creating a web of interconnections rather than a chain.