From a Stereophile review:
20-bit D/A conversion
Technically, the Denon has more in common with the Kinergetics, Thetas, and Proceeds of the world than the typical Japanese player. For starters, the 2560 uses four Analog Devices AD-1862 20-bit DACs, two for each channel in push-pull configuration. These DACs are flanked by their attendant MSB trimpots, which Denon hand-trims for highest linearity at the factory.
Denon operates these high-quality chips in an interesting configuration they call "Lambda D/A Conversion"; to minimize the zero-crossing distortion caused by MSB nonlinearity, the data stream is taken from the digital filter and duplicated so there are two data streams. After adding a constant digital "bias" to each data stream, positive-going for one and negative-going for the other, the data streams feed the 20-bit Analog Devices DACs, whose analog outputs are then summed; as the bias signals are opposite in value, they ultimately cancel, but the resultant signal is biased away from the zero-crossing line, eliminating that source of distortion. The tradeoff (there's always a tradeoff) is that for high-level signals requiring the full dynamic range of the DACs, the Lambda process is momentarily disabled, the high-level signals then theoretically masking the residual distortion.