The new Audioquest Dragonfly....sounds terrific.

I would honestly assume that the DAC would work better for lossy files since they have more to gain but it would work great for lossless as well, assuming you could hear the difference. I tried it on both 320kps and lossless (since that's what use the most) and didn't come away blown away on either. Here's what I posted on my initial impressions:

I would recommend trying it if you're interested from Best Buy or something -- someone who has a return policy after 2 or 3 weeks. You may indeed hear a major difference - I seem to be in the minority on that one. It's a really nice DAC for what it is. You can also try one of the Fiio DACs which I hear are good as well (like the E17).

 

Has anyone done a comparison between the Dragonfly (either version 1 or 2) and the Schiit Modi? Trying to put together an office setup and not sure which way I want to go.

 

I had a DACitx till I destroyed it lol. At the time I thought it was the best sounding DAC for the money. Really liked it. Picked it over a Meridian Explorer after a side by side comparison.

The original Dragonfly was amazing. Figure you could keep it and use it on the go. I'm planing on grabbing the new one while I'm waiting for the new iFi DAC to come out

 

I'm thinking my next DAC may be a Meridian Explorer 2 or Musical Fidelity V90.