Play-to-Earn experienced a massive wave of adoption during 2021, as crypto-friendly gamers jumped on the opportunity to earn money while playing games. P2E games such as Axie Infinity, Star Atlas, and others saw a dramatic increase in user and revenue growth. However, after the initial hype wave over P2E games settled, what was left was a realization that many of these games lacked truly engaging gameplay, social features, and sustainable tokenomics.
Fast forward to late 2021/early 2022, we witnessed a significant pivot in the blockchain gaming space: Move-to-Earn. M2E has taken the world by storm, with numerous projects popping up and their valuations skyrocketing. Among the younger generations, there is a trend towards self-care and maintaining a more healthy lifestyle as we continuously get reminded of just how much time we end up spending indoors. Covid lockdowns took this lifestyle to the extreme and forced everyone to spend time at home longer than many felt comfortable. Now there is a thirst for a more active, healthier life.
P2E games have had (and continue to have) a good run, but M2E has managed to capture the interest of not only gamers, but also those blockchain enthusiasts who might not be fully on board with just spending time tapping away at their phone screen to earn their P2E tokens. However, every project comes with its own shortcomings. Let’s take a look at these shortcomings and how an emerging project – FitEvo has transformed its platform amidst this trend with a new edge.
With popular M2E games such as STEPN, Genopets, and STEP, you’ll find that they share a common gameplay model in which the user acquires an in-game asset, be it a sneaker or a pet animal, and upgrades it further as they keep on exercising.
But these features on their own are not enough to make an M2E game successful. The focus should be just as much on the social aspects and community engagement opportunities around a user’s physical activities, as it is on the earning and NFT upgrading experiences. And many of the games in this space seem to have forgotten what the most popular traditional social fitness apps such as Strava, FitBit, and MyFitnessPal have already done in order to expand their user base, and keep it engaged.
Strava, one of the pioneers in the social fitness app space, has achieved an enormous global user adoption, boasting nearly 100 million users. Much of this growth can be attributed to the app offering not only a feed of activities of their friends, but also other social features that are geography-centric and community engagement focused.
This precedent for a successful M2E game is exactly the reason why FitEvo is so appealing in terms of fundamentals. FitEvo, an M2E dragon breeding NFT game, has the makings of an incredibly successful blockchain-based game, as they have incorporated many of the social features that people know and love.
FitEvo: Focusing on the Interaction Between Individuals
FitEvo aims to engage the masses through a powerful combination of NFT dragon breeding (evolving together with a dragon companion), and social features that gamify physical activity and human competitiveness, and bring friends and communities closer together.
An engaging and fun dragon breeding game, FitEvo has been inspired by the greats, like Tamagotchi and Pokemon, taking it to the next level by syncing the user’s movements with the development of their very own dragon. In FitEvo, the dragon co-evolves with the user, creating a bond between the two. The hatching of eggs, breeding and evolving of dragons, will be intimately linked to the physical movements of their masters.
And here is where FitEvo will really shine – the social and gamification features. For those familiar with the M2E STEP game, FitEvo will be like a new and improved Step 2.0, incorporating all the crucial engagement mechanisms that have made traditional social fitness apps so popular. If you’re one of those who didn’t manage to get in on STEP early on, it might be worth your while to pay close attention to FitEvo.
The multiplayer feature alone will offer an enormous amount of value to the users, FitEvo allows FITamins(as the FitEvo community calls itself) to meet other like-minded and even geographically adjacent individuals by organizing group runs or other group exercises. Anyone who has ever tried getting back in shape with their friends cheering them up or even being right next to them, sweating off their own dietary sins, knows how much it helps to have someone give you motivation and some peer pressure at your lowest moments. This type of community support will be possible, with FITamins helping each other become their better selves.
Of course, what would a fitness app be without some healthy competition? FitEvo will offer many opportunities to challenge others and stimulate their competitive neurons through classical challenges, as well as user-created routes with leaderboards.
In addition to earning $FIVO tokens through movement, FitEvo has made sure that attention is paid to incentivizing more extensive user engagement beyond exercising and dragon breeding. Users will be able to collect Active Points through interactions, referral count, daily sign-ins, missions completed, community contributions, and more. The Points will significantly influence users’ earnings to the upside, so it will be in everyone’s best interest if they try to make the best of their experiences on the FitEvo app – and why shouldn’t they?
Another interesting feature that we are yet to hear more about is the training programme, which will offer inexperienced users the opportunity to learn from the community and follow pre-planned exercise curricula without having to design them themselves.
Incorporating all of these features will be no small feat for FitEvo, and it will be interesting to see how the project progresses forward. With such a clear edge over their competitors defined, it’s now up to the FitEvo team to deliver on these ambitions and rise through the ranks of the M2E space.
A recent uptick in projects combining the concepts of move-to-play and play-to-earn into what is known as move-to-earn have started gaining traction, with more and more people trying out this new play-to-earn paradigm. Players are rewarded proportional to their physical activity, incentivizing an active lifestyle all the while generating a passive income. This article looks at 5 reasons why move-to-earn might become the hottest crypto trend of 2022.
And check out our predictions and analysis on whether move to earn has potential to become a BILLION dollar industry:
Move to Earn: BILLION dollar potential in 2022? Predictions and Analysis (StepN $GMT)
What Is Move-To-Earn?
Move-to-earn is a fast developing component of Web3, enabling individuals to own and monetize their personal data. M2E’s mission is to scale the blockchain-based incentives system for healthy lifestyle promotion. The increased use of fitness trackers and employer-sponsored wellness programs that reward employees for boosting their physical activity might result in the global fitness tracker market growing from $36.34 billion in 2020 to $114.36 billion in 2028. Employee absenteeism due to illness can be reduced with fitness-based M2E. In this aspect, M2E applications have a far wider audience reach than P2E applications.
5 Reasons Move-To-Earn NFT Games Will Be the Hottest Trend of 2022
1. Investors are Flocking towards Move to Earn Projects
Investors make it their job to identify trends, and seeing the amount of investments in play-to-earn gaming projects, it’s easy to see how the recent influx of cash into projects (such as STEPN and Genopets) in the past months foreshadow the upcoming success of move-to-earn. In their January seed round, STEPN raised $5 million, and, back in October 2021, Genopets raised a whopping $8.3 million in their seed round.
We’re likely to see more projects and investments by way of SAFTs, and retail-focused IGOs (Initial Game Offerings) to pop up this year, each attempting their own take on monetizing the intersection of blockchain and physical activity.
2. People want to be Active Post-lockdown (Whilst Earning Passive Income)!
With Covid lockdowns mostly fading away and warm weather (in the Northern hemisphere) knocking on the door, life will return from the drab cold days of the winter, forcing everyone outdoors. The pandemic showed us that better physical health can keep us from experiencing severe effects of disease, as is the case with Covid-19, and many will try to improve their health as a result.
Combined with a desire to socialize and finding the next thing to get addicted to (aside from social media and binging Netflix), an app that aligns an active lifestyle, passive income, collectibles, and mobile video games in a fun and engaging way can be a very powerful combo that launches some move-to-earn projects into our daily lives this year.
Looks like move-to-earn gaming will contribute to a planet-wide increase in human health by combining the two things people love to do, whether they admit it or not, making money and playing games!
3. Move-to-Earn Gets People Earning Faster and Easier than Play-to-Earn Games
With play-to-earn games having laid the practical and conceptual foundations of NFT-based gaming, move-to-earn NFT games are set to see a rapid rise in popularity this year. Games like Axie Infinity, The Sandbox, and many more, have exploded in the past years, amassing a large user base and catalyzing the creation of gaming guilds that bring like-minded gamers together. Now, the crypto community is ready for a new evolution of Play-to-Earn.
The biggest advantage of move-to-earn games is the low barrier of entry. Contrary to traditional character-based games with narratives and gameplay that require time, dedication and effort to understand, move-to-earn games leverage actions that every human is very familiar with – movement! This means that a player has practically no learning curve before they can start playing and earning, completely eliminating barriers to entry for anyone. Simply open the app and start earning!
4. Move-to-Earn Builds on the Proven success of Social Fitness Apps
Anyone who’s actively used fitness apps like Strava, Fitbit, or PlayFitt will know how addictive their gamification aspects can be, be it trying to set a route record, trying to keep up with the physical activity of your friends (and get more likes), or even competing against yourself as you see your progress in the app.
These social fitness apps do something magical – they bring out our competitive side, forcing us to push further than we’ve ever pushed, either against ourselves or others. And the amazing thing is that, aside from improved physical health, there is no additional reward that would merit such dedication. If peer pressure and social clout is enough to cause us to do things we normally wouldn’t happily do – exercise – what will the promise of earning a buck or two as you exercise do to us?
Move-to-earn games seek to answer the question: “What if you added a financial layer and further gamification to a social fitness app, and built it on robust decentralized technologies to ensure fairness and true ownership?”
5. Move-to-earn Might be the NFT Play Many Retail Investors are Waiting for
Though some metaverse coins like Axie Infinity’s $AXS have gone parabolic since last year, the bigger Metaverse & GameFi narrative plays are yet to fully take off. This leaves plenty of options to choose from from an investment/bag holding perspective, with many potential “up-only” plays looming around the corner.
In addition, many retail investors missed the insane gains of last summer’s NFT craze, either due to not fully understanding how to take advantage of the NFT hype train, or simply not wanting to be bothered with having to immerse themselves into the culture of the NFTs to anticipate the highest ROI plays. Flipping NFTs is more difficult than simply buying a coin that goes up.
Luckily for these people, move-to-earn projects might offer just the solution. In addition to having NFTs, which can be traded as normal, these games also incorporate in-game utility and governance tokens, which can be easily purchased on exchanges, and grow as the value and popularity of the game grows.
STEPN and Dotmoovs have both made a very smart decision by integrating an NFT marketplace with its own Rental System, allowing players to borrow sneakers/ footballs and start earning quickly and seamlessly, without having to join a gaming guild and apply for a scholarship. Click here to learn more about the controversial practice of NFT Scholarships.
Not only is this more beneficial for players, but also for NFT owners who don’t want to earn by moving, but through lending them to someone else and collecting a percentage of the fruits of their labor.
By reducing the friction of lending their sneaker NFTs to scholars, all owners need to do is to simply place their NFTs on the in-game marketplace, and reap the rewards. This approach to NFT staking will likely gain popularity due to the ease of use and low barriers of entry for hobbyist NFT owners.
Conclusion
2022 is looking ripe for move-to-earn games, as GameFi, active lifestyle, and SocialFi narratives take root, eventually culminating in a hype train that might even overshadow previous parabolic narrative-driven runs!
Axie Infinity ($AXS) is probably the first game everyone thinks of when talking about crypto gaming or GameFi. This is for a good reason too, it is hugely popular with millions of players worldwide and is well known for helping many earn a living (whilst playing the game) during the Covid-19 lockdowns. Recently, however, the game has been plagued by problems such as a multi-million dollar hack, and reports about shady practices by some Axie players. In this article, we look at the rise and fall(?) of Axie Infinity and how it can be a valuable case study for the future of other play to earn crypto games.
What is Axie Infinity ($AXS)?
Axie Infinity ($AXS) is a popular play-to-earn NFT blockchain-based game where players can earn by leveraging gameplay skills and contributing to the ecosystem. Partially inspired by the popular Pokémon video game series, Axie Infinity allows players to pit monsters called Axies against each other in battles. Gamers can also collect and raise their monster pets, and build land-based kingdoms for the pets as they progress through the game.
Axie Infinity is easily one of the most popular games in the cryptocurrency and blockchain sector. Launched by Vietnamese game-maker Sky Mavis, Axie Infinity concluded a $7.5 million funding round in May 2021, with Reddit co-founder Alexis Ohanian and billionaire Mark Cuban as investors. According to Bloomberg, the number of daily active users on Axie Infinity jumped from 30,000 to 1 million between April and August last year. Furthermore, from April 2018 to July 1st, 2021, Sky Mavis generated $21 million from Axie Infinity; by the end of August in the same year, that number jumped more than 2,200% to $485 million.
Yet despite its meteoric rise, Axie Infinity has seen a dramatic decline in daily revenue and general interest since its November 2021 peak, when its revenues reached an all-time high of $165 USD. To better understand the unraveling of one of the most popular blockchain games, let’s take a look at the recent issues and challenges Axie has faced in the past months.
Check out our video where we analyse the crypto gaming trend and where we think it’s headed.
My honest take on crypto gaming
Some Major Problems and Criticisms of Axie Infinity
The Axie Infinity universe has had its fair share of criticism. One of the most significant issues is the problematically high barrier of entry. Although Axie Infinity is free to download, players need at least three Axies to begin with, each costing a minimum of $29. This can be a costly initial investment for some and would deter them from even starting the game in the first place.
The expensive initial cost has created active Discord and Telegram groups where prospective players are consistently on the hunt for sponsors to help get their feet in the door. Unfortunately, sponsors sometimes make inappropriate requests before assisting players. Last year, Axie Infinity reacted to reports of sponsors requesting nude photos from players.
Other controversial practices, such as the “Scholarship” practice emerged whereby gamers lacking the initial capital (known as “Scholars”) would borrow Axies from “Managers” in return for a significant amount of in-game earnings. In some cases the split was as high as 50:50 between the Scholar and the Manager. In the Philippines, where it was well-known that locals quit their jobs in favour of playing Axie professionally due to its high returns, the practice was very widespread. During Axie’s heyday in 2021, many scholarship “guilds” were formed, some of which had over 3,000 players playing multiple games for their Managers. These Managers have even gone so far as to say that they may remove peoples’ scholarships if the scholars did not play to their satisfaction. Considering the average wage of a Filipino employee was only US$3,218, critics have accused Axie Infinity’s business model to “digital serfdom”– modern exploitation in the digital space.
In response to accusations of controversial practices by some Axie Infinity players, Sky Mavis Co-founder and Chief Operating Officer Aleksander Leonard Larsen likened Axie Infinity to a digital nation, suggesting that there are criminals in any society. The COO admitted that the issue is an internal concern for the Company and that the platform has banned “several thousand” accounts so far.
Revenue Plunge
Axie Infinity’s revenue was already dropping since its peak in November 2021. According to an image from Token Terminal, Axie Infinity began October with $6 million in daily revenue. Between October 4th and early December, revenue spiked up to $10 million but also plunged to nearly $2 million. However, since December 12th, there has been a steady decline. In fact, Axie has not crossed $2 million since mid-December, even recording less than $21,000 as recently as March 30th. According to a recent report, Axie plunged 40% in September alone.
Axie Infinity’s Ronin Network Hack
By far, the biggest issue Axie has faced in its 4-year history is a US$625 million hack that took place on 23 March 2022. According to an official Substack post, hackers compromised Sky Mavis’ Ronin Network validator nodes and Axie DAO validators, which are used to power the game. As a result the hackers successfully made away with 25.5 million USDC and 173,600 Ether (ETH). The unknown hackers depleted funds from the Ronin bridge in two transactions.
Ronin explained that the chain currently has nine validator nodes to prevent illicit transactions, and requires five validatory signatures to recognize all withdrawals or deposits. In November, Ronin let Sky Mavis sign transactions to help with high demand from new Axie players. Although this only lasted till December, the allowlist access remained active, and the attacker was able to access Sky Mavis systems to get a signature from the Axie DAO validator through Ronin’s gas-free RPC node. By doing so, the hacker was able to gain validation access over this highly centralized network, controlling the majority of nodes, and thus, the decision-making power.
Analytics firm Chainalysis is currently helping Sky Mavis to track the stolen funds and has said the funds are still in the hacker’s wallet. Ronin has also said all stakeholders are now trying to ensure that users don’t lose any funds.
The Substack post also specifies several actions taken to curb further loss. For instance, withdrawal or deposit recognition now requires eight signatures instead of five. There is also a temporary pause on the Ronin Bridge in addition to Binance disabling their bridge to and from Ronin. The Katana DEX was also immediately suspended. Unfortunately, none of that has stopped prices of their AXS token from falling 25% since the hack occured.
Axie Infinity’s Future: is this the end?
Even with these evident drawbacks, several members of the gaming community believe that Axie Infinity has a bright future ahead of it. Some analysts think that the platform’s extensive and ever-increasing community can only spell long-term progress. Axie Infinity has enjoyed large-scale popularity and increased AXS token prices such that many believe that there is no worthy competitor. However, the recent hack might sway public opinions very fast.
Although Axie’s revenue has consistently dropped since late last year, The plunge has been even steeper in the last few days. Token Terminal data shows that Axie pulled in just $184,500 on March 1st, from $2.1 million on January 19th. Revenue on March 25th was less than $9,000.
Prices of the project’s native $AXS token have also taken a tumble, with prices reaching an all time high of $164.90 on 6th November 2021, and now down to around $38 in late April 2022. Check here for the latest prices for $AXS and data provided by CoinGecko.
Several competitors, such as Crypto Kitties, Decentraland and MetaGods, have been trying to give Axie Infinity a good run for its money. Now is finally the right time for these alternative play-to-earn ecosystems to steal Axie’s disgruntled customers. Popular options can leverage Axie Infinity’s current downtime to revamp their existing offerings or introduce new ones, making the features attractive enough for Axie players to cross over. In what may end up as the likely outcome, players may also be satisfied enough to consider keeping and using accounts across most of these popular play-to-earn games.
With all the fuss and mistrust currently circulating within the gamefi space, it might also be a good time for new games to launch, or at least begin to whet gamers’ appetites. Possible strategies could include specific advertisements targeted at security, more gaming options, more accessible play-to-earn services, and immersive gameplay that can rival Axie Infinity. If competitors offer little to no financial entry barriers, Axie Infinity could have a very challenging time getting back on its feet after it eventually opens the Ronin bridge.
Conclusion
Currently, the Ronin bridge remains closed, with all deposits and withdrawals halted pending a full investigation into the hack. It is expected that it may be another few weeks before the Ronin bridge is operational again. Most importantly, the team behind Axie Infinity has promised affected users that they will recover and reimburse the stolen funds. Despite this setback, Axie Infinity still has over 600,000 active daily users, demonstrating its popularity, and the game itself is not going away anytime soon.
Ledger Nano S was first released in 2016 with more than 3 million units sold around the world. Ledger announced that they will retire the Nano S in June 2022. This is to let its new and improved version, the Nano S Plus, take its place going forward. Even though Nano S will stop production, firmware upgrades for it will keep rolling out in the future.
The final (and special) edition was called Ledger Nano S Final Edition. It came with a POAP card that allows you to claim an exclusive NFT created by the artist “what is real?”. However, it is sold out.
We recommend you get the upgraded Ledger Nano S Plus as it has added DeFi and NFT friendly features. Check out our review of the Nano S Plus here.
Ledger Live allows for staking a growing number of coins, including ETH (Ethereum), SOL (Solana), ATOM (Cosmos) and DOT (Polkadot). Users can lock up their cryptocurrencies and in return they get interest. This feature expands Ledger into more than just a secure place to store your cryptocurrency. It can even help you grow your digital assets.
Depending on the coin, staking can be done natively on Ledger Live, or through a dedicated wallet. For example Yoroi Lite for ADA (Cardano). Staking is done in 3 simple steps for coins that can be staked on Ledger Live.
First, freeze your assets by logging onto Ledger Live. Choose the relevant account for the asset you wish to stake and click “earn rewards”. A popup window will appear. There you will be allowed to select the amount in your wallet you wish to freeze. Secondly, vote for your validator(s) who will be making the blocks on your network. The cryptocurrency earned by making these blocks will be redistributed to voters. Lastly, claim your rewards by clicking “Claim” in your relevant account. Rewards are claimable every 24 hours.
Swapping
Ledger has released a Ledger Swap feature which allows users to exchange their cryptocurrencies through Challengly, Wyre, Paraswap and 1inch. You send your cryptocurrency from your device to the exchange, which will then send you back the swapped cryptocurrencies.
To swap you will need: Ledger device, Ledger Live, the app for the crypto you want to swap and receive, and the exchange app.
Lending
Ledger is working with Compound (COMP), Aave (AAVE) to allow users to lend DAI, USDT and USDC through their decentralised finance (DeFi) protocols. The purpose of doing this is that the lender could earn an interest on their loan. Ledger Live has also integrated with Alkemi Earn. This is a lending-borrowing protocol that utilizes a permissioned liquidity pool of digital assets comprising ETH, wBTC and stablecoins. The purpose of which is to generate yield for liquidity providers.
There are numerous benefits when using Ledger to lend:
Control: You have control and proof that the crypto you lend and generated interest belong to you. When you lend on Compound, you receive cTokens as proof of ownership of lent cryptocurrencies and generated interest. You can redeem your assets and interest by sending cTokens back to the smart contract.
Security: cTokens are stored on your ledger hardware wallets.
Convenience: Compound’s lending features are available directly through Ledger Live.
You can lend crypto using Compound or Aave and Ledger Live in 3 simple steps. Firstly, on Ledger Live’s Manager, install the application for the cryptocurrency you want to lend and create an account. Secondly, enable your account to authorise Compound/Aave’s smart contract to interact with your account. Finally, select the amount of cryptocurrencies you want to lend and issue a transaction to Compound/Aave. Verify and approve the transaction on your device.
Security Features
Ledger Nano S features 2 hardware chips: ST31H320 & STM32F042
One of the key reasons to buy Ledger hardware wallets is the firms reputation for security. Cryptocurrencies hardware wallets are like bank accounts – they contain full access to funds and need banking grade security. Ledger Nano S contains two hardware chips:
Secure Element: ST31H320 (secure) is independently certified CC EAL5+ and stores the private key and signs transactions
Operating system: STM32F042 chip is responsible for Ledger’s BOLOS proprietary Operating System.
Secure elements are separate pieces of hardware (second layer of security). Secure elements have their own storage and limited functionality that hackers cannot breach.
Even if hackers or malware compromise your computer, the Ledger will still keep your cryptocurrencies secure. Devices like the Trezor One and Trezor Model T have chosen not have secure elements. And so only have a single layer of security.
The Nano X, Nano S Plus and Nano S are the only cryptocurrency hardware wallets to receive CSPN (First Level Security Certificate) certification. This is issued by the ANSSI (National Agency for Information Systems Security). The certification scheme evaluates multiple aspects of a device’s security. For example firewall, identification, authentication and embedded software by putting it through multiple attack scenarios.
Similar to the Nano X, users can also protect their funds using a PIN code and passphrase. The PIN code is to generally unlock your device to use it. Whilst you can also set up wallets protected by a passphrase in addition to your primary PIN code.
If someone threatens you to unlock your device, you can give them the PIN code to access wallets with fewer funds. Meanwhile, passphrase protected wallets contain the bulk of your crypto assets.
Ledger firmware version 1.6: security enhancements
24 words recovery phrase confirmation has been simplified and shortened. Now for each of the 24 words of the recovery phrase, users will only choose among 4 words. Therefore making it much easier to get through the process;
The Nano S now has the Control Center feature that was originally on the Nano X. Allowing for functions such as accessing settings, locking device or deleting applications possible directly on the device;
Added support for Bitcoin Taproot upgrade;
Added support for the seed derivation algorithm EIP-2333. Thus allowing you to securely sign a deposit contract transaction for Ethereum 2.0 on your device;
Before the firmware update. The power consumption is in a predictable pattern.After the firmware update. The device consumes power in an unpredictable pattern and inverts the PIN code display.
After the update, we find that being unable to enter PIN code digits in order anymore may be slightly inconvenient. However with cryptocurrencies, security always comes up top over convenience. And with the added partial screen inversion, we see that Ledger’s bounty program is not just a PR stunt. Ledger actually looked into submissions and made the security improvements even when the suggested hack was only hypothetical.
Ledger Hack?
In July 2020, Ledger confirmed they suffered a data breach. An unauthorised third party had accessed Ledger’s e-commerce and marketing database. (www.gamepur.com) Ledger collaborated with forensic firm Orange Cyberdefense and determined that the data breach affected around 292,000 customers and exposed approximately 20,000 customer personal records.
Ledger had reported the matter to authorities and are working with Orange Cyberdefense to investigate.
Subsequent the breach, users have reported receiving phishing emails and texts. These emails and texts ask users to download a new version of the Ledger software. Clicking the email link redirects users to a fake Ledger site. If users download the “update”, it asks for their Ledger’s recovery phrase but is actually malware. The attacker uses the entered recovery phrase to recover the user’s wallet and sends the user’s cryptocurrencies to the attacker’s wallet. For a full explainer on how the phishing attack works see the report from Kraken.
Phishing email sent from info@ledgersupport.io address (Image credit: Kraken)
Therefore this incident was a “data breach” rather than a “hack”. More importantly, this breach had no link or impact on the Ledger hardware wallets or the Ledger Live app. Cryptocurrencies stored on the Ledger devices have never been at risk.
Even before the firmware update, the Nano S scored full marks on security. We also note that the hack does not affect the Ledger device itself, so our scores remain unchanged.
Ledger has one of the most diverse support for different cryptocurrencies such as Algorand (ALGO), Solana (SOL) and Chainlink (LINK). With their open policy to development from project teams, the Ledger Nano S supports 1800+ different assets. Many of these assets like Vechain or NEO are not found on competitors like the Trezor Model T or KeepKey. Thus making Ledger the only hardware wallet available for many coins.
One of the initial weaknesses of the Nano S was that it only fit 2-3 apps on the device. However Firmware Version 1.6 allowed users to install 5-11 apps (depending on the type of app installed). This will certainly answer the prayers of a lot of average cryptocurrency holders who generally hold around 5-10 different coins.
If you need more apps, you can uninstall the ones you’re not using and reinstall them later. Uninstalling apps won’t delete coins and all account information will remain. The newly released Ledger Nano X fixes this problem by increasing the internal memory to 2 MB.
Ledger’s firmware update directly addressed a significant weakness in the Nano S. Whilst it still can’t beat the Nano X in terms of multi-currency support, it is good enough for most traders. For this reason, we give our thumbs up and bumped the score up from 4/5 to 4.5/5 for multi-currency support.
Multi-Currency Support: 4.5/5
Hardware Design
Ledger Nano S compared with Nano X
Ledger Nano S has two hardware buttons – located on the top of the device. These two buttons allows us to access menus (hold both buttons), make selections (press both buttons). And even input recovery phrases (use buttons to scroll). We found that entering PINs and recovery phrases to be tedious with only 2 buttons. Perhaps a touchscreen or additional buttons could have helped?
With the update 1.6, the Ledger Nano S has an improved display UI. So, the device displays the full cryptocurrency address without the need to scroll. This allows for easier verification of the target destination. The Nano S uses a USB micro-B interface for charging and connecting to the PC.
With its plans to continue its firmware upgrades in the future, clearly the Ledger will never fully abandon the Nano S.
Hardware Design: 3.5/5 Ease of Use: 4/5
Why Use a Hardware Wallet
With traditional currencies, you, the user, are the most important person. If you have ever lost your bank card, you can always go to the bank with some sort of identification and request for access back to your account.
Cryptocurrencies, however, don’t care about the physical person but rather the private key associated with the wallet. You use the private key to verify the account and transactions. Anyone with access to the key can send funds, so you must keep it safe. Additionally, you cannot reverse cryptocurrency transactions.
Hardware wallets can protect you against these things. They add an extra layer of security by storing the private key on the device itself. The only way to hack it would be to have physical access to the hardware wallet or the backup phrase.
Ledger Nano S Worth it in 2023?
In short, the answer is: not really. Ledger has retired the Nano S and even the Ledger S Final Edition. Both are no longer available for sale on the official site. This means that the only places where you’ll be able to buy them are 3rd party sellers or second hand. We highly advise against both options because someone might have tampered with the device.
Mind you, Ledger will continue to support the Nano S’s firmware so it stays up-to-date. If you were lucky enough to buy the Nano S while it was still available, it is still worth using. Unless, you want the upgraded DeFi and NFT features. If not, your only choice is to get a Nano S Plus. Although this costs an extra 20USD, they did add upgrades to make it worth your while.
64-bits desktop computer (Windows 8+, macOS 10.8+, Linux) excluding ARM Processors. Also compatible with smartphones (iOS 9+ or Android 7+) via OTG cable.
Bybit is a cryptocurrency exchange offering trading perpetual contracts in the cryptocurrency market. However, it’s essential to understand the rates and fees that come with using the platform. In this article, we’ll explain Bybit’s funding rates and fees and give you some tips on how to manage them.
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Bybit is a cryptocurrency exchange founded by Ben Zhou and launched in 2018. The exchange currently has over 10 million users worldwide and supports over 100 cryptocurrencies. Bybit offers the following products: spot trading, derivatives trading (including USDT/USDC perpetual contracts, USDC options, leveraged trading, inverse perps and futures), an NFT marketplace, and Bybit earn.
Bybit Funding Rate Explained
Bybit’s funding rate can be challenging to understand for new traders. However, it’s essential to know how it works to manage your trading costs effectively. In simple terms, it is a fee that traders pay or receive when holding a position overnight. If you’re holding a long position, you’ll pay a funding fee if the funding rate is positive. If you’re holding a short position, you’ll pay a funding fee if the funding rate is negative.
Bybit funding rates on perpetual contracts (Source: Bybit)
Funding Fees on Perpetual Contracts
Bybit charges a funding fee for holding positions overnight, and the fee is calculated based on the funding rate. This is calculated using the following formula:
Funding Fee = Position Value * Funding Rate
In this formula, “Position Value” is the total value of the trader’s position, and “Funding Rate” is the current funding rate. The fee is charged every eight hours, and it’s debited or credited to the trader’s account.
The Funding Rate is already stated on the screenshot, i.e. 0.0001%. The Position Value is calculated using the following formula:
Position Value=Quantity of Contract x Mark Price
For example:
Trader Bob holds a long position of 10 BTC contracts and the Mark Priceis 16,000 USDT at the end of the funding interval with a Funding Rate of 0.0001%.
To calculate the Position Value:
Position Value= 10 x 16,000 = 160,000 USDT
Now we can calculate the Funding Fee:
Funding Fee= 160,000 x 0.0001% = 0.16 USDT
Since the Funding Rate is positive (i.e. 0.0001%), long position holders have to pay short position holders. So, Trader Bob must pay 0.16 USDT to a short position trader. Meanwhile, a short position holder with the same quantity of contracts (i.e. 10 BTC) will receive 0.16 USDT.
Funding Fees on Inverse Contracts
Here’s how to calculate the funding fees on Bybit inverse contracts using the below screenshot as an example. Since the funding rate is positive, long position holders need to pay a 0.01% funding rate to short position holders.
Bybit funding fees on inverse contracts (Source: Bybit)
The funding fee is calculated using the following formulas:
Funding Fee= Position Value x Funding Rate
The Funding Rate is already stated on the screenshot, i.e. 0.01%. The Position Value is calculated using the following formula:
Position Value=Quantity of Contract / Mark Price
For example:
Trader Tom holds a long position of 10,000 BTCUSD contracts and the Mark Priceis 16,000 USD at the end of the funding interval with a Funding Rate of 0.01%.
To calculate the Position Value:
Position Value= 10,000 / 16,000 = 0.625 BTC
Now we can move on to calculate the Funding Fee:
Funding Fee= 0.625 x 0.01% = 0.0000625 BTC
Since the Funding Rate is positive (i.e. 0.01%), long position holders have to pay short position holders. So, Trader Tom must pay 0.0000625 BTC to a short position trader. Meanwhile, a short trader holding the same quantity of contracts (i.e. 10,000 BTCUSD contracts) will receive 0.0000625 BTC.
When does Bybit calculate its Funding Rates?
Bybit generally calculates its funding rates every 8 hours i.e. at 00:00 UTC, 08:00 UTC and 16:00 UTC. These are known as “funding intervals”. However, Bybit may adjust the interval depending on the live market situation. Particularly if there is a significant gap between the Last Traded Price and the Mark Price.
What are the Last Traded Price and the Mark Price on Bybit?
Bybit uses two prices to protect traders from market manipulation, also known as a Dual-price Mechanism. These are the Last Traded Price and the Mark Price. The Mark Price is used to decide when to liquidate a trader’s position and to measure their profits and losses. It is based on a global Spot price index plus a decaying funding basis rate. A trader’s position will only be liquidated if the Mark Price reaches their liquidation price. The Mark Price can be found at the bottom right-hand corner of the page.
The Mark Price can be found at the bottom right-hand corner of the page.
Bybit Mark Price as shown in yellow (Source: Bybit)
On the other hand, the Last Traded Price reflects Bybit’s current price and is always anchored to the spot price.
When do Bybit traders pay/receive the funding fee?
Traders will only pay or receive funding fees if they hold an open position at the end of every funding interval. As mentioned, this is generally at 00:00 UTC, 08:00 UTC and 16:00 UTC. However, Bybit warns users that opening/closing a position within 5 seconds before/after the funding interval does not guarantee they would be included or excluded from receiving or having to pay.
Users can see the current funding rate and when the next funding interval ends on Bybit. In the example above, the funding rate is negative. This means that short position holders will pay fees to long position holders at the end of the countdown.
The funding rate mechanism happens between traders, so Bybit doesn’t take any fees. If a user has to pay a funding fee, it is taken from their available balance. If they don’t have enough money in their balance, the fee is taken from their position margin. This can make the liquidation price of their position more likely to reach the mark price. This increases the risk of liquidation.
Bybit Funding Rate History
Bybit’s funding rate history is available here on the platform’s website. The history is crucial for traders who want to understand how the rates have changed over time and make informed trading decisions.
Mobile App
Bybit has a mobile app that you can download from Google Play or the Apple App Store. The app helps traders keep track of the latest rates and fees. It has a chart that shows the current funding rate for each contract on the platform.
Managing Bybit Funding Rates and Fees
Bybit funding rates and fees can affect how much money a trader makes. Traders need to manage these costs to make the most profit. Here are some tips on how to do that:
Watch the funding rates for the cryptocurrencies you trade. Look at the chart and past data to find patterns and make better decisions.
Be careful with your positions to lower your funding fees. Close positions before the funding interval if the rate is high or if you’re not sure about the position.
Bybit lets you trade with up to 100x leverage. This can make your profits or losses bigger. Use leverage carefully and don’t take on too much risk.
Make sure you have enough money in your account to pay the funding fees. Bybit will close your positions if you don’t have enough money to pay the fees.
How to profit with Bybit Funding Rates and Fees
Crypto funding rates are linked to the price trend of the asset. The spot market sets the rate. When the price of the cryptocurrency is going up, the rates will be higher. When crypto prices are rising, there are usually higher trading price premiums and rates. In these situations, traders who hold short positions on perpetual contracts and go long on the spot market can earn funding fees.
When crypto prices are falling, the trading price of perpetual contracts will be lower than the spot price. This will make funding rates go down. Traders who go long in the perpetual contracts market and hold short positions in the spot market during this time can receive funding fees.
On Bybit, you can check the historical and predicted rates here.
Conclusion
Bybit is a popular cryptocurrency trading platform that offers perpetual contracts on several cryptocurrencies. Traders need to understand the funding rates and fees associated with the platform to manage their costs effectively. By monitoring the rates, managing their positions, using leverage wisely, and keeping a sufficient balance, traders can maximize their profits on Bybit.
Sign up and get started today!
Frequently Asked Questions (FAQs)
What is Bybit funding rate?
Bybit funding rate is the interest rate that traders pay or receive for holding positions overnight. It is calculated based on the difference between the funding rate index and the last traded price of the contract. Bybit charges a funding fee every eight hours for holding positions overnight.
What are Bybit funding fees?
Bybit funding fees are the fees charged for holding positions overnight. The funding fees are calculated based on the position value and the funding rate. The funding fee is debited or credited to the trader’s account based on the position they hold.
How are Bybit funding rates and fees calculated?
Bybit funding rates and fees are calculated based on the position value and the funding rate. The funding rate is determined by the difference between the funding rate index and the last traded price of the contract. The funding fee is calculated using the following formula: Funding Fee = Position Value * Funding Rate.
What is Bybit funding rate chart?
It is a chart that shows the historical funding rates for each cryptocurrency offered on the platform. Traders can use the chart to analyze the funding rates and make better-informed trading decisions.
What are some tips for managing Bybit funding rates and fees?
Traders can manage Bybit funding rates and fees by monitoring the rates, managing their positions carefully, avoiding overexposure to the market, using leverage wisely, and ensuring that they have a sufficient balance in their account to cover the funding fees.
What is the funding fee Binance?
Binance also charges a funding fee for holding positions overnight. The funding fee on Binance is calculated using the same formula as Bybit. However, the rates and fees on Binance may differ from those on Bybit.
Blockchain technology is often considered the best solution to problems caused by centralization. Through blockchain, people get to exercise authority over their personal affairs and enjoy more security and sovereignty, especially with financial transactions. Yet despite all the advantages of blockchain adoption, the technology also has a few current drawbacks.
Many people complain about unstable and sometimes relatively high transaction fees. For some people, the main problem with blockchain is a lack of interoperability between several different systems while others worry about response time or latency. However, a bigger issue lurks around the corner – scalability.
Compared to traditional systems, blockchain technology might be a long way from tackling the scalability problem. Saito Network helps to solve these issues by providing unique solutions for the general growth of the sector.
What is Saito ($SAITO)?
Saito ($SAITO) is a layer-1 blockchain that provides a permissionless and scalable network for decentralized applications. The open network also supports in-browser crypto applications without private APIs or plugins.
Saito aims to tackle problems caused by centralization, as well as scalability issues that are commonplace with both Proof-of-Work (PoW) and Proof-of-Stake (PoW) blockchains. Instead of paying stakers and miners for block production, the network directly pays internet service providers, allowing easy use of regular browsers for decentralized projects. This method helps new and existing Web3 projects run cost-effective operations instead of paying node operators like Infura.
Learn more about Proof of Stake (PoS) vs Proof of Work (PoW) with our article: Proof of Stake Explained
Saito’s open infrastructure provides better security for projects looking to host on a blockchain without intermediaries. A problem with employing the services of a middleman is the apparent centralization of a supposedly decentralized product. Another issue is that projects connected to the blockchain through node operators are open to several risks if the operator becomes compromised or otherwise unavailable. For example, in 2020, Infura suffered an outage that caused Binance and other exchanges to disable ERC-20 transactions. By connecting projects directly to the blockchain through the browser, Saito Network allows decentralized apps or other infrastructure to host their own nodes without an intermediary.
Features of Saito
Saito’s decentralized framework is essential to the ongoing shift to Web3. Since a major tenet of Web3 is decentralization, the platform’s basic structure is the critical tool developers and various projects need to compete in the new iteration of the internet. The following Saito features place the network at the forefront of Web3 development:
Truly Peer-To-Peer: Saito ensures that projects and all their transactions are truly peer-to-peer. No go-between is required.
Scalable Onchain Data: Saito solves scalability problems by providing easy dApp support through browsers instead of relying on a node operator.
Browser Applications: All projects will quickly onboard and operate decentralized applications directly through a browser, without the need for a plugin like MetaMask.
What makes Saito special?
In addition to the advantages Web3 projects enjoy through Saito, the platform also offers the following:
Dynamic App Support: Saito’s network provides a valuable framework for several applications regardless of data or bandwidth requirements. Developers can build anything from games to social media apps and communication tools.
Open Infrastructure: Other networks can take advantage of Saito’s infrastructure to tackle interoperability problems.
Web3 Blockchains: All applications built on Saito support Polkadot and many other major Web3 blockchains, with many more coming down the line.
App Deployment: Developers can easily create and publish apps on Saito’s platform. App creators can do everything from start to finish without any third-party infrastructure.
Vibrant Community: Joining the Saito community exposes projects and developers to an active and growing community of like-minded people excited about Web3 development.
Saito has already processed more than 10 million transactions and averages over 30,000 transactions per day. With more than 30 popular applications and modules already in the works, Saito has positioned itself as the best chance for the ongoing evolution of Web3.
SAITO Token: What is it?
SAITO token is the network’s native asset, a utility token that powers activities on the platform. The platform offers two types of SAITO on different networks, an ERC-20 variation and the Layer One SAITO. The ERC-20 tokens are wrapped tokens in ERC-20 form and are available to public sale participants over vesting periods. Wrapped SAITO asupports purchases and permissionless integration in off-chain applications. Users who hold ERC-20 SAITO also enjoy token withdrawals to any public Saito fork.
Layer-One SAITO tokens have on-chain utility and represent 75% of all tokens minted. As the network expands, on-chain SAITO holders will enjoy increased liquidity and convertibility. However, holders cannot directly convert Layer-One SAITO to ERC-20 SAITO. Of the allocated 75%, the Saito Foundation retains 20%, while strategic partners share a 10% pool. Rewards, contributors/developers, and the Saito core team all receive 15% each of the SAITO token supply.
Starly ($STARLY) will be launching on KuCoin with STARLY/USDT trading pair. Details are as follows:
Deposits open from 16 February 2022 (Supported Network: BEP20)
Trading: 10:00 on 17 February 2022 (UTC)
Withdrawals: 10:00 on 20 February 2022 (UTC)
The total supply of STARLY will be 100,000,000 with a market cap of US$4,756,784.
The circulating supply will be 5,945,980 STARLY at US$0.8.
Starly token staking: How to guide
Staking your STARLY tokens helps support the development of Starly, in return, token stakers can receive rewards. Staking Starly requires 2 simple steps:
Add STARLY tokens to your wallet; and
Stake STARLY
How to add STARLY tokens to your wallet
To add STARLY onto your wallet, you must be on the Flow blockchain. For those who participated in Starly’s Blocto IDO, your tokens are already on Flow.
On the other hand, if your STARLY is on Binance Smart Chain (BSC), you will need to use the Blocto teleport to bridge your STARLY from BSC to Flow by connecting your wallets. On the Blocto teleport:
Select the STARLY token;
select BSC blockchain in the “from” field;
select Flow blockchain in the “to” field; and
select “connect BSC”.
How to stake STARLY tokens
On the Starly website, go to the “Staking” tab and enter the amount of STARLY you would like to stake (Tip: you can stake your STARLY in several batches so that you can unstake them separately later on).
After you have staked your tokens you would be able to see the amount staked, unlock date, and annual interest. Staked tokens are locked for 30 days- afterward you can claim your tokens and STARLY rewards at any time. Of course, the longer you stake your STARLY tokens, the more additional tokens you can earn. To unstake your Starly, simply click “unstake”. (https://www.disabilityhelpcenter.org/)
Staking STARLY will yield a guaranteed 15% annual percentage rate. However, for a limited time only, Starly is offering a special 20% APY on all tokens staked before 15 March 2022.
Starly ($STARLY) is a launchpad and marketplace for creators and collectors to expand their economies around gamified NFT collections. Collecting NFTs on Starly will be an immersive experience with different NFT rarity classes, distribution of NFTs in sealed packs along with features such as limited editions, rewards, collector scores, and game-like mechanisms.
NFT collectors on Starly can experience the excitement of pack opening, marketplace trading, all whilst being rewarded for achieving key milestones. Starly aims to transform NFTs into a social experience and create a one-of-a-kind relationship between the creators and their community.
The excitement from the community toward a shared vision of a community-led and community-owned home sharing economy has been incredible, and Dtravel can’t wait to start building the ecosystem.
If you didn’t get a chance to participate in the MEXC, Gate or Polkastarter events, the Bybit launchpool is still ongoing until 28 November 2021 at 7:59AM UTC.
TRVL will be available from 26 November 2021 at 1:00PM UTC on the following exchanges:
Once again, a big thank you to the Dtravel community for your spectacular support! More updates coming soon!
About Dtravel
Dtravel is a decentralized, global home sharing community that facilitates seamless short-term accommodation discovery, bookings and payments, with much lower fees than other home sharing platforms. Conceived by former executives of global technology companies such as Airbnb, Expedia and more, Dtravel aims to empower its members — including hosts, guests and token holders — to participate in the growth and decision making of a new type of home sharing economy through community governance.
MetaWars, the next-generation sci-fi strategy game, has officially launched the $WARS token. MetaWars successfully developed the best tokenomics for its ecosystem with the help of marketing partners that led to the release of the $WARS and $GAM tokens on the blockchain.
A Quick Recap About MetaWars
MetaWars is a sci-fi focused strategy game that enables players to earn through gameplay. Players can embark on their journey in a highly-realistic space environment during the game with the help of NFTs in the form of resources and mechas. The game’s play-to-earn feature enables players to fight, trade, and play while earning NFTs and additional rewards. For more information check out our full Metawars guide.
The Legacy So Far
MetaWars released their pre-launch NFT auction from the 21st to the 27th of October, which allowed buyers to purchase valuable in-game assets and supplies. The event garnered huge success, nearing a total of 1,000 bids by the end of the auction.
The project continued their impressive feats on the day of their launch on the 27th of October, with an initial listing price of $0.008 on PancakeSwap skyrocketing over 100x.
The staking pool and dapp also went live recently for the community to stake $WARS tokens. Players, in turn, earn $GAM tokens, an in-game utility token that will play a vital role in the MetaWars universe.
Launch Highlights
The pre-launch NFT auction successfully obtained close to 1,000 bids and raised a total of 2,000 BNB.
MetaWars’ $WARS tokens were sold out in a flash on all three launchpads — Polylauncher, GameFi and Red Kite — within minutes.
The very first MetaWars game trailer and demo was released to the public in order to show a glimpse of the immersive gameplay — interested parties can view the clip here.
Staking of $WARS and $WARS-BUSD LP went live on MetaWars’ dapp, access it here.
MetaWars’ Discord server remains active with more than 22,000 members to date and an invitation contest is currently underway that will enable participants with the most invites to earn limited in-game asset NFTs.
Future Plans
Following a hugely successful launch, MetaWars is currently working on its adventure game, with plans to release it later this month. The NFT staking feature is also currently in the works and will be announced to the public in the near future.
More details about the game will be announced soon. To follow up with MetaWars’ updates and developments, follow their social media channels below.
About MetaWars
MetaWars is a play-to-earn next-generation blockchain gaming experience. Explore and battle throughout the universe. Fight, trade, and earn robots, ships, and planetary terrain backed by in-game NFTs. The $WARS token will become the anchor of an entire universe up for grabs.
The highly anticipated Ethereum London Hard Fork upgrade went live on August 5th, 2021, which sent the price of ETH rallying to above $2,800 for the first time since June 7th on bullish sentiment.
The upgrade includes a fee reduction feature called EIP 1559, which burned more than 3,000 ETH in only a few hours since taking effect.
The latest backward-incompatible upgrade to the Ethereum blockchain introduced five new Ethereum Improvement Proposals (EIPs), ushering in a new era for the transition to Ethereum 2.0.
EIP 1559, EIP 3554, EIP 3529, EIP 3198 and EIP 3541 are code upgrades that aim to improve the network’s user experience and value proposition.
It is fair to say that the London upgrade received more media attention than previous upgrades, but rightfully so as this upgrade represents an important step forward for the cryptocurrency, proving that the Ethereum ecosystem is able to make significant changes.
That’s in stark contrast to Bitcoin, which is so decentralized that changes to its blockchain network are incredibly difficult.
The Ethereum blockchain still has major changes ahead, most notably its transition to a proof-of-stake (POS) system from a proof-of-work (POW) system. One of the biggest criticisms faced by Ethereum is its heavy energy usage and carbon emissions released during ether mining through proof-of-work.
A proof-of-work system relies on a network of computers around the world constantly running to solve complex problems to support and validate the blockchain. A proof-of-stake platform, which does not incentivize heavy energy consumption, allows users to put up their own tokens as collateral to support the blockchain network.
According to its founder Vitalik Buterin in an interview with Bloomberg, the change to proof-of-stake will reduce carbon emissions related to the mining of ether by 99%. Buterin expects the merge to Ethereum 2.0 to take place in early 2022 but it could come as early as late 2021.
The London hard fork “definitely makes me feel more confident about the merge.” Buterin told Bloomberg, going on to add that the transition to a proof-of-stake system would eventually change the economics of ether, such as a supply cap similar to bitcoin’s 21 million coin limit.
EIP 1559 – Making Ethereum less inflationary
The EIP 1559 upgrade is the most discussed code change of the London hard fork, altering the transaction fee structure for the Ethereum network. Instead of fees going directly to the miners that process and validate transactions, a base fee would instead go to the miners and to the network before being burned and removed from circulation.
EIP 1559 removed the first-price auction as the main gas fee calculation, where users typically bid a dedicated amount of money to pay for their transaction to be processed on the Ethereum blockchain.
Gas fees are fee payments required from users who create transfers or transactions on the Ethereum blockchain. Previously, users paid these fees without knowing the exact price to pay beforehand. In order to make sure the transaction gets processed, some users overpaid to ensure the transaction went ahead smoothly. Other users who paid less faced the uncertainty of whether the transaction will get processed in a timely manner.
The EIP 1559 changed the method by which transactions are processed on the blockchain by enabling clear pricing on a base transaction fee paid to miners in ETH to validate the transfers. A small amount of the tokens will be burnt and taken out of the circulating supply permanently. Users may also choose to include an optional tip, a “priority fee,” along with their base fee to incentivize miners for a quicker process if desired.
As a result of its activation, EIP 1559 improved user experience by automating transaction prices and taking the guesswork out of an opaque auction process, while still allowing miners to earn from tips and block rewards.
EIP 3554 – Defusing the difficulty bomb
EIP 3554 delays the “difficulty bomb” that is coded to make mining more difficult, essentially “freezing” it in preparation for Ethereum’s transition away from a proof-of-work model.
Also called the “Ice Age,” the difficulty bomb is intended to disincentivize miners from using proof-of-work once Ethereum 2.0 is ready by making block rewards much harder to come by. EIP 3354 pushes the Ice Age back to December 1st, 2021, hinting that the merge with Ethereum 2.0 may happen at the end of the year.
This is the fourth time that the difficulty bomb has been delayed, and unless the network is finally ready to move to proof-of-stake by the end of the year, it’s likely to be delayed once again in yet another network upgrade.
EIP 3529 – Reducing impact-less refunds
EIP 3529 reduces gas refunds, which were typically used to incentivize developers to reduce or delete unused smart contracts and addresses on Ethereum.
“Gas tokens” like Chi and GST2 gamed the system by taking up space on the network when gas fees were low and reaping the benefits by deleting their data when gas fees were high. With the implementation of EIP 3529, these tokens will become obsolete.
EIP 3198 – Improving smart contract UX
EIP 3198 improves the user experience of smart contracts by adding an operation code (opcode) that gives the EVM (Ethereum Virtual Machine) access to the block’s base fee.
The base fee is a small amount of Ether paid for each block created which can help with gas efficiency and reduction in transaction costs. Some applications will be able to use this fee, and other applications may choose not to use this opcode in their smart contract code if they do not need it.
This improves the user experience of smart contracts by increasing the security for state channels, plasma, optimistic rollups and other solutions that prevent fraud.
EIP 3541 – Making future updates easier
EIP 3541 sets up future upgrades to the Ethereum Virtual Machine (EVM) by removing the ability to start new contracts with “0xEF or Executable Format.”
Although it won’t have an immediate effect on the network, it sets up future changes and restricts the EVM from consuming specific data types.
ETH 2.0 Becomes The Leading Holder of Ether
At present, the staking contract of Ethereum 2.0 has become the largest holder of Ether (ETH).
According to blockchain analytics provider Nansen, the ETH 2.0 staking contract has surpassed Wrapped Ethereum (wETH) to become the single largest holder of ETH. Unlike Ether, Wrapped Ether adheres to the ERC-20 standard, making it the favored representation of ETH among decentralized finance protocols that use ERC-20 tokens.
Alex Svanevik, the CEO of Nansen, put up his findings on Twitter on August 16th, 2021. According to the available data, the Beacon Chain’s deposit contract holds 6.73 million ETH – worth roughly $21.5 billion at current prices.
Nansen analytics data
By contrast, Nansen’s data suggests the Wrapped Ethereum contract holds 6.7 million ETH ($21.4 billion), followed by Binance with 2.29 million ETH ($7.3 billion).
The quantity of Ether locked and staked on ETH 2.0 currently represents 5.7% of Ethereum’s circulating supply, according to CoinMarketCap. There are now 210,000 validators for the ETH 2.0 network, according to Beaconcha.in.
Currently, Ether staked on ETH 2.0 is locked up and cannot be withdrawn from the contract until Ethereum’s forthcoming chain merge, which will meld the Ethereum and ETH 2.0 networks.
According to Staking Rewards, ETH 2.0 is currently the third-largest proof-of-stake network by staked capitalization, ranking behind Cardano’s $49 billion and Solana’s $27.5 billion.
FAQ
What is the London hard fork?
Ethereum’s London hard fork is an irreversible network upgrade consisting of five Ethereum Improvement Proposals (EIPs), all of which are code upgrades paving the way for the network’s transition in the future from proof-of-work to proof-of-stake.
What is EIP 1559?
EIP 1559 changes how transaction fees work on the Ethereum blockchain in two ways. First, it adds a base fee to every transaction that takes place on Ethereum. This base fee aims to lower overall costs to the user, because it will improve gas fee estimations.
Second, transaction fees will no longer go to miners, but to the Ethereum network itself, before being burned and taken out of circulation. These base fees are set using an algorithm and there will be an additional option to pay a tip to the miners to prioritize a transaction.
Burning base fees could result in a decreased supply of Ethereum, making ETH a deflationary currency.
What are the other key takeaways from the London hard fork?
The upgrades will provide a better smart contract use experience. Future updates of the network will become easier with the new proposals.
The network delayed the difficulty bomb to provide more time for the transition towards Ethereum 2.0.
Did the London hard fork create another token?
No. Often hard forks will lead to the creation of another token (such as the fork that created Ethereum Classic in 2016). However, in this case, the London hard fork can be considered as a network upgrade. Ethereum protocols will change, but it will still be the one and only Ethereum.
When is the transition to Ethereum 2.0?
The merge to Ethereum 2.0 is expected to take place in early 2022 or possibly in late 2021.
