Rumors have surfaced in China that a Huobi Executive has been held under custody by Chinese Authorities.
Huge deposits into Huobi
There has been a deposit of over $400 Million worth of Tether and other cryptocurrencies to the exchange. Two of the transactions are extremely large, accounting for $304 million USD (as spotted by Whale alerts).
China is tightening control over cryptocurrencies trades
On an official level, cryptocurrency exchanges are not permitted in china after the 2017 ban. However, enforcement of this policy has been relatively weak in 2018 and 2019. Cryptocurrencies were traded largely via OTC – over the counter desks that exchanged fiat deposits to crypto. Interestingly enough, key Chinese exchanges such as Huobi, Okex, and Binance all offered OTC matching services. It is important to make the distinction that exchanges didn’t facilitate the actual exchange – instead, they matched exchange users and independently operated OTC services.
In 2020, OTCs bank accounts were targeted and bank accounts of involved parties were suspended.
Huobi Token drops in value
The value of the Huobi token declined by over 20% in a flash crash following the rumor. This was also correlated to the large movement of USDT out of the exchange.
HT suddenly fell sharply, 100 million USDT was transferred, COO was reported to be investigated but there was no response temporarily, triggering panic in the Chinese market. Huobi is the largest exchange in China. (https://kidsrkids.com) After the OK, Huobi was also panicked. pic.twitter.com/oQtQBQhh1N
Initially it was suggested that Chairman, Founder and CEO Leon Li was arrested. As with the OKEx detention incident, people on Chinese social media tried to find ways to see if this was true. Among those were people who again tried to check his pedometer and breathed a sign of relief when they found he had been walking more than 5,000 steps today.
Li Lin pedometer
Huobi Denies all rumors, stating they are false
Huobi has come out to deny all the rumors, stating that there are no members of the Huobi team that are taken under custody.
Nevertheless, users are not taking their chances and rushing to withdraw their deposits from Huobi. According to Whale Alert, nearly USD$240 million worth of Bitcoin has been transferred out of Huobi in the space of 2 hours on 3rd November 2020.
Developing story: OKEx suspends withdrawals…but is there more to this?
On 16th October 2020 OKEx suddenly announced one of their private key holders (later confirmed to be Star Xu, OK Group’s CEO and Co-founder) is cooperating with a “public security bureau” and is unable to be reached. Therefore the Exchange cannot complete authorisations for transactions and thus decided to suspend all withdrawals of digital assets/cryptocurrencies from 16th October 2020 at 11:00 (HKT).
But is there more to this?
Let’s take a look at some events on 16th October 2020 which may (or may not) be relevant to this:
1:00a.m.: Twitter user @whale_alert tweets: 5,000 #BTC (57,033,847 USD) transferred from unknown wallet to #OKEx
4:00a.m.: Twitter user @whale_alert tweets: 1,180 BTC (13,588,646 USD) transferred from OKEx to unknown wallet
9:00a.m.: Twitter user @whale_alert tweets: 50,000,000 TRX (1,317,074 USD) transferred from OKEx to unknown wallet. 11:55a.m.: Chinese crypto media platform 非小號 (Feixiaohao) and UAICOIN publishes notices from OKEx that withdrawals will be suspended from 3:00p.m. onwards. This was also reported in a tweet from Co-founder of Chinese crypto media outlet @redtheminer who also notes the rumours circulating in the Chinese crypto community that over 800 accounts from a “certain large crypto exchange” are involved in cross border money laundering.
12:00p.m.: OKEx announcement that it would suspend withdrawals from 11:00a.m. onwards.
1:00p.m.: OKEx finally tweets their announcement on the withdrawal suspension.
2:00p.m.: OKEx CEO Jay Hao tweets, reassures that all other operations are unaffected and that, “The investigation concerns a certain private key holder’s personal issue only. Further announcements will be made.”
2:51p.m.: Someone asks OKEx support “Why is Star Xu’s Weibo page emptied?” and they replied, “The person you are referring to has no relation to our platform”.
3:51p.m.: Twitter user @whale_alert tweets: 998 BTC (11,333,911 USD) transferred from Huobi to OKEx.
10:31p.m.: Twitter user @whale_alert tweets: 3,500 BTC (39,627,432 USD) transferred from OKEx to Binance. They however are suspecting it may be an internal transfer.
*All times are stated in HKT unless otherwise specified.
There are reports from Chinese media that Xu was in fact already arrested a week ago, whilst 2 executives that were also arrested have since been relased on bail. His arrest is causing a stir because he holds the private keys to OKEx’s funds, and according to Glassnode’s data, OKEx holds around 200,000 BTC i.e. USD$2.3 billion worth of Bitcoin.
From the events and how OKEx could have simply made another “less alarming” reason for suspending withdrawals, we have a feeling the Exchange was caught off guard by the events too. Although there are reports that Xu was arrested in relation to matters unrelated to OKEx. In particular it was in relation to funds he had borrowed from a Shanxi-based underground bank for the purposes of the backdoor listing of OKC Holdings on the Hong Kong Stock Exchange in 2019.
In the meantime we can only await further official announcements from the Exchange.
Due to overwhelming positive response, we are bringing back our list of potential issues with DeFi/Yield farming projects. Please note that some of these raised issues are subject to further verification so please do your own research. Here’s what was discussed this week on our Telegram/Discord alone:
cVault Finance ($CORE): Not related to the project itself but there is a scam pretending to be an “official” 1,000 CORE giveaway with a fake telegram channel.
Decore.finance ($DCORE): The website says that due to a contract bug they have halted the process of adding/withdrawing liquidity from vault. One of our members apparently spoke with a contract auditor who said on an initial review it didn’t seem like anything was suspicious. However, we do note that Coingecko’s page for the project has put up a notice that they have received allegations the team has abandoned the project and asks users to proceed with caution.
Fuelswap. finance ($FUEL): Unencrypted network used to connect to your Metamask which could result in loss of funds. Telegram is gone.
Justswap.finance ($JUST): Not related to Justin Sun’s justswap.io. This is a virus/malware disguised as an airdrop. The website will take your money and attack your computer with malware injected into the website.
Piratetoken.finance: All trades apparently would get 5% pirate tax that gets distributed to 1 holder daily at random when in fact there was no prize. Website can no longer be found.
Rabbitwallet.org: You will be prevented from withdrawing and empty your wallet if you approve any spending limit on the website.
Seal Finance ($SEAL): Potential code that can allow devs to withdraw tokens from your wallet. Note the Seal finance team have responded that this code is only for their cSeal token farming contracts, and is only for them to help users who mistakenly transfer their assets.
Thirm protocol ($THIRM): Initially said their early developer’s wallet was hacked and warned users to remove liquidity ASAP. The Team later clarified that in fact the promotor wallet was hacked and dumped around 2,000 THIRM. New tokens will be created and THIRM holders before the hack would be given the same balance plus 2% bonus tokens.
Triangle.finance ($TRI): Website and Telegram disappeared. Twitter only has one post on it from 12th October 2020.
Wineswap.finance: Entire contract was emptied within 20 minutes from launch and social media is now gone.
Thank you to CC, Cheatbandit, Coderwongy, madrick8, Ronald Jones, RyGuy31581156 and Lolibutts!
Are DeFi scams ruining yield farming for everyone else?
This week we were interviewed by CoinTelegraph on our views on “Escalating DeFi scams tarnishing the crypto yield farming market niche”. In relation to the topic, we definitely think the recent strings of DeFi scams are seriously affecting the reputation of this field and people’s interest. We also gave our insights on how we try to avoid scams through research, and some of our methodologies.
Filecoin mainnet is finally launched and listed after 3 years
Filecoin ($FIL) was one of China’s hottest projects back in the 2017 Initial Coin Offering (ICO) craze, having raised USD$200 million. At around 3:00pm (UTC) on 15th October 2020 the mainnet was finally launched and exchanges such as Binance, FTX and Huobi, etc rushed to list FIL.
Upon listing, prices for FIL shot up 118%, and this is due to the very small circulating supply at the time- around 0.7% of the total. And at the very early moments of listing, due to the price differences for $FIL on different exchanges such as HuoBi and FTX, some traders were able to take advantage by purchasing a short and a long on each of these exchanges respectively. This was further explained in our livestream on 16th October 2020 (at 5:13 mins). The discrepancy in prices though has converged so this “IQ 200 play” is no longer viable 🙁
As with most new listings, prices dipped after the initial moments of listing. Prices are down 45% but the downward trajectory seems to be slowing down. Currently, prices are still sitting above USD$40.
However, we do question what would happen to prices when another 0.7% of $FIL is released? Also, the fully diluted valuation is USD$136 billion dollars- approximately 4x of Ethereum. Is that realistic?
PlotX Mainnet launch
On 13th October 2020 PlotX ($PLOT) has been launched on the Ethereum Mainnet and listed on Uniswap.
PlotX was one of the most anticipated launches of the last weeks being a decentralized predictions market protocol that lets users guess the future market outcome and get rewarded for correct predictions. Here you can read our article on the project and view Michael’s video with Ish Goel, Co-founder of PlotX.
Making prediction markets easier- PlotX with Ish Goel
As with many times before, the hours preceding the launch have been characterized by fake tokens appearing on Uniswap creating problems for distracted investors. The listing price was USD$0.05 but it spiked to more than USD$1 at the beginning to later start its real discovery price phase. It has so far been stabilizing itself around a more modest 10 cents price.
SWAG Finance (pleasantly) surprises everyone with early launch
SWAG Finance ($SWAG) was offering a decentralised community governance token i.e. $SWAG as a part of Swag.live’s expansion. Swag.live is a popular adult entertainment platform with over 10 million users worldwide. They are currently based in Asia but have plans to expand operations to North America and worldwide.
SWAG launched its First Swap Event at 10:00p.m. UTC on 14th October 2020 which would allow users to swap for SWAG and be entitled to their rewards distribution, known as SQUIRTS.
This launch was hugely successful and according to the Team, SWAG prices shot up 240% upon launch. Whilst prices are no longer at their all-time high, it is still up nearly 3 times compared to launch.
Andre Cronje comes back
A few days ago, Andre Cronje, one of the most famous personalities in crypto as well as one of the best and most genius developers, came out with a new medium article “Unpacking my involvement in DeFi“.
After having disappeared for a while after receiving death threats related to the Eminence ($EMN) episode, when a lot of crypto investors who started speculating and buying into his not-yet-released project ended up losing their money (a hack for a total amount of USD$15 million, 8 of which have then been sent back by the hacker), Andre came back to clarify a few things. Among them:
“I do not build to make a number go up”. Meaning that he only wants to build for developers and to enable them to easily create products out of his initial work
“Tokens are not stock”, you buy a token to be a contributor of a project, not a bystander
“Development process”, where he explains that his famous “test in prod” statement has been misinterpreted and it “exists to deter people from using systems without investigations”.
He then goes on to clarify that he is just a contributor to Yearn Finance ($YFI), not the creator and that he has now stopped using Twitter to avoid further misunderstandings, as long as using his deployer account (that makes his new projects immediately traceable back to him, hence starting the FOMO).
He ends with his personal thoughts about this space, which give him mixed feelings which he doesn’t really know how to express. We also see a lack of trust that is increasing among the community and that lately, we have also heard rumors about a group of DeFi users grouping up and planning to sue him for what happened.
We understand that things are adding up in his mind, creating even more confusion about what the future holds for him.
More and more companies investing in Bitcoin
Bitcoin treasuries in publicly traded companies
The list of Public Companies that use Bitcoin as a reserve asset is growing by the day. In September 2020, we discovered how Microstrategy was able to raise its holdings to over USD$435 Million worth of Bitcoin, and it just showed us once again how Crypto is still nothing compared to traditional finance in terms of numbers. Its CEO Michael Saylor tweeted: “To acquire 16,796 BTC, we traded continuously 74 hours, executing 88,617 trades ~0.19 BTC every 3 seconds”, which translated in roughly $39,414 in BTC per minute.
The last additions to the crypto game have been Stone Ridge, which revealed a USD$115 Million investment (part of a Billion-dollar spinoff), and Square, that invested USD$50 Million. Its CEO, Jack Dorsey, has been known as a Bitcoin supporter for quite some time now.
With all these big names trusting the future outcome of Bitcoin, who are we to doubt their judgement?
DCEP- testing China’s digital currency, lottery style
China’s national digital currency DCEP is now undergoing testing amongst the public in Shenzhen. The government in Shenzhen gave away RMB10 Million in an experiment to test their digital currency, which is not a traditional cryptocurrency as we usually imagine them because it is centralized and under the control of the People’s Bank of China.
Recently, Shenzhen residents were able to sign up for a lottery to get some free DCEP to test out. The lottery was hugely oversubscribed, and only a lucky 2.61% were able to get their hands on RMB200 (around USD$30) of DCEP to spend at designated stores.
If you want to know more about what is DCEP, take a look at our article.
Upcoming events
19 Oct 6:00am: Injective Protocol ($INJ) ticket claim will open on Binance Launchpad. More details here. 19 Oct 2:00pm: Trading opens for CryptoLocally ($GIV) on Bithumb. 20 Oct 8:00am: Winning tickets for Injective Protocol will be announced. 21- 22 Oct: Blockchain Life 2020 (Moscow) 22 Oct: Token sale starts for The Graph ($GRT) for already registered participants.
*All times are listed in UTC unless otherwise stated.
Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.
Regulators are catching up…but who are they really protecting?
The UK’s Financial Conduct Authority (FCA) will be banning the sale of cryptocurrency derivatives to retail consumers from January 2021. The ban will cover exchange-traded notes (ETNs), crypto futures, options, CFDs and other derivatives. Whilst direct cryptocurrency trading and commodities, and central bank digital currencies, e.g. China’s DCEP will not be covered.
Their rationale was that cryptocurrency derivatives were not suited for consumers due to the harm they pose. Specifically, the inherent nature of these products meant that there is no reliable basis for valuation and that market abuse and financial crime is prevalent. From the consumer’s standpoint, the FCA took the view that they have an inadequate understanding of crypto assets, and there is a lack of legitimate investment need for them to invest in these products.
When interviewed by CoinTelegraph, Coinshares, a UK-based company providing cryptocurrency ETNs expressed its disappointment in the ban. Coinshares recalls they were heavily involved in the consultation process and lobbied against it. Yet the FCA ignored the reasons put forward by Coinshares and other industry participants against the ban or dismissed them with little additional information. Further, they take the view that the FCA had made it clear in initial consultations and draft rules that they do not believe digital assets including Bitcoin have any value, suggesting that the FCA had long ago made up its mind on the matter.
Coinshares also expresses concern that the ban would instead have the opposite effect, driving UK retail investors to unregulated cryptocurrency exchanges.
We also consider this ban a step backward for investors who are now deprived of options. Looking at the reasons put forward by the FCA, it appears they would like to maintain the status quo rather than allowing room for innovation. And shutting it down on the basis of consumers’ ignorance before they even have a chance to understand it. And in fact, according to the FCA’s Policy Statement on the matter, 97% of the respondents to the FCA’s consultation opposed the ban. Which brings up questions on who the FCA is really interested in protecting.
RAMP DeFi ($RAMP) sells out in 4 minutes
RAMP Defi held it’s public sale at 10 pm on the 10th of October (what perfect timing). The sale was packed with a few hard questions, but this didn’t deter avid buys from buying out the token sale in less than 4 minutes. Overall, this shows that the demand for good projects is still extremely strong.
Meanwhile, financial heavyweights are banking big on Bitcoin
Square Inc. (NYSE: SQ), a US mobile payment company and creator of Square Cash App- an app used to buy and sell cryptocurrencies announced it has purchased USD$50mil in Bitcoin. This amounts to 4,709 BTC at an average price of USD$10,617.96 per BTC.
The Company calls Bitcoin an instrument of “economic empowerment” and that the purchase is in alignment with their vision of building products based on a more inclusive future. They also believe that Bitcoin, “…has the potential to be a more ubiquitous currency in the future”.
But Square is not the first to do this, in early 2020 business intelligence firm MicroStrategy already invested half a billion dollars into Bitcoin.
This news gave the markets a much-needed breath of positivity. Prices for Bitcoin hovered below USD$10,750 earlier this week and upon the news effortlessly pushed back up to over USD $11,250. Now it remains to be seen whether this positivity can be upheld.
DeFi/yield farming scams are ruining things for the space?
Not a day goes by on our Telegram/Discord without discussions about potential issues with DeFi/yield farming projects or worse, outright scams. Please note that some of these raised issues are subject to further verification so please do your own research. Here’s what was looked at this week in our Telegram/Discord alone:
Amplyfi.money: Rug pulled after collecting 2,500 ETH from investors. Their social media and websites are gone
Beer Garden Finance: Founder holds over 50% of the token supply in his personal wallet. When our community asked for more details such as a github link for the project, or timelocks for the tokens they were banned from the Telegram group.
Burn Vault Finance ($BFV): Allegedly rug pulled. Their Telegram and social media no longer exist.
CBDAO ($BREE): The project had a presale for $SBREE tokens which would be swapped for $BREE. One of the admin wallets exploited a backdoor in the SBREE token contract, minted 50,000 SBREE, converted it to BREE and sold it on the market, pushing down the price of BREE at the expense of other holders. The 50,000 BREE was sold for under 200 ETH.
Degenballz: staking may steal 1% of your LP tokens.
Emerald Mine (EMD): User tokens worth nearly USD$2.5mil that were supposedly locked under a smart contract were moved to another account. Fortunately, cryptocurrency exchange ChangeNow managed to stop the sale of 135,020 EOS. However, this only represents a small fraction of the total amount stolen.
Lv.finance: Falsified audit results, after investors deposited their funds in they found they were unable to withdraw. The team has disappeared.
Minions Farm: Has cute Minions but will access all your assets when you connect your wallet to the Minions Wallet site.
Steaks.finance: Developers apparently had trouble interacting with their own timelock. Though some consider it may be due to a problem with their code rather than ill-intentions.
Tomatoes.finance: Hacker triggered simple permission granting and withdrew tokens.
UniCat ($MEOW): Back door in smart contracts allowed UniCat to keep control over users’ tokens even after they were withdrawn from the pool. Around USD$200,000 worth of crypto has supposedly been stolen.
Unirocket ($URCKT): Apparently rug-pulled, cannot be located on social media.
Yfdex.finance: Project promoted themselves on Twitter for 2 days, took a total of USD$20mil of investor funds and absconded.
These incidents have caused users substantial losses, even more so when some people unwisely put in more than they can afford to lose. As a result, it seriously affects their appetite and even the ability to believe in DeFi’s potentials. What’s more, it affects people’s interest in yield farming which like it or not, was the main draw for people since some farms promised unheard of returns not found in any other asset class. Now with the interest and returns for yield farming decreasing due to how prolific these scams and exploits are, the corresponding interest in DeFi, in general, is also losing steam. This is a huge shame considering DeFi had huge potential to bring financial services to the unbanked and was a direct challenge to the status quo being perpetrated by institutions and regulators, as we can already see above.
Will DeFi push governments to finally adopt CBDCs?
With DeFi gaining traction and new projects emerging every day, what can central banks and governments do to maintain their dominance whilst benefitting from the new technologies and conveniences brought by DeFi? An answer could be to create a Central Bank Digitial Currency (CBDC). In an article published in Forbes, the author suggests that governments should push towards issuing CBDCs as it would allow users to enjoy cheaper and faster transactions. The article also touches upon our coverage of DCEP and contrasts China’s progress in testing DCEP with the US which is still only debating the topic.
Indeed the European Central Bank (ECB) has announced it would pursue the possibility of issuing a “digital Euro”. Though there are no concrete plans yet, the ECB recognises consumers’ demand for digital payments, and in their Report on a Digital Euro published on 2nd October 2020 noted that they would be “..ready to introduce a digital euro, shall the need arise.”
In any event, as the Forbes article suggests governments need to be quick to catch up to DeFi. The legion of innovators in the DeFi space is growing, and will the overwhelming advantages of DeFi, there is a real risk of it toppling the status quo long-held by governments and institutions in their favour.
Upcoming events
11 Oct 2020: Results for Shenzhen, China’s DCEP lottery will be announced. Winners will receive RMB 200 (US$30) in DCEP and can spend it at 3,389 participating shops. We are eagerly awaiting winners to post how DCEP will work in action! 12 Oct 2020 3:00am: Boxmining livestream 15 Oct 2020: Filecoin ($FIL) mainnet launch. Huobi Global will launch FIL on the same day and trading, deposits and withdrawals will be opened.
*All times are listed in UTC unless otherwise stated.
Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.
“Good guy” hacker: Hacks Andre Cronje’s project, returns 50% of loot
Eminence Finance was a work in progress teased by Andre Cronje in a cryptic tweet. This however was already enough for some investors who rushed to buy EMN tokens.
On 29th September 2020 however, the crypto community sounded the alarm of a rug pull after seeing that Cronje’s developer wallet had interacted with a new Ethereum address. The hacker stole a total of USD$15mil worth of invested assets.
Those who had invested attacked Cronje, accusing him of failing to take safety precautions and not making his project private. Some even went as far as sending death threats to Cronje and one person has even alleged they lost USD$100,000 in this hack.
Strangely, the hacker decided to send USD$8mil back to Cronje’s address but retained USD$7mil for himself. Subsequently, Cronje tweeted that he had asked the yearn treasury to refund the USD$8mil returned by the hacker to affected users.
This is certainly a painful lesson for those affected. But it is yet another reminder that people should always do their own full research before putting any funds into a project. This is especially true considering we have been observing a marked rise in scams in the past few weeks.
KuCoin Hack pt 2: Still not out of the woods yet
The KuCoin hack occurred on 25th September 2020 and the tally so far seems to be that over USD$200 million in customer funds have been lost, though according to KuCoin, around 130 million has already been secured or in the process of being recovered.
Not all projects have their services fully restored (i.e. trading, deposits, and withdrawals). As at 2:30pm on 2nd October 2020 (UTC) the following projects HAVE had their services fully restored:
Full services restored for the following projects. Items in red are the latest additions to the list. (Image credit: KuCoin.com)
To mitigate the effects of the hack, projects have generally taken 1 of 4 approaches: (1) freeze their tokens; (2) replace their tokens; (3) if the tokens were recoverable, to return them to KuCoin; or (4) invalidate the tokens.
Meanwhile, Hacken have announced that as a way of supporting the cryptocurrency community, they will be looking into the KuCoin hack and publishing their findings. From their initial investigations, it seems that it was a social engineering attack on a KuCoin employee who had access to private keys worth USD$150mil.
KuCoin of course has also launched their own investigations and apparently identified those involved in the breach with “substantial proof at hand” against them. KuCoin has contacted law enforcement officials and police to take action against them.
A reminder again to put your cryptocurrencies in a hardware wallet if you haven’t done so already! Check out our Ledger Nano X review or buy it here.
BitMEX is in hot water
On 1st October 2020, civil and criminal proceedings have been respectively issued by the DOJ and CFTC against BitMEX, its CEO Arthur Hayes, together with other key personnel and affiliates. Meanwhile, BitMEX’s CTO who was at the time working in the US, was arrested. The DOJ accuses BitMEX of failing to implement proper KYC/AML procedures in breach of the Bank Secrecy Act, whilst the CTFC alleges the Exchange had failed to register as a derivatives exchange yet still offering services to US customers.
However, the speculation is that the current charges are only a precursor to more severe charges that would be issued against the individuals once they have been extradited to the US e.g. breaching international sanctions via BitMEX allowing those from Iran and North Korea to move out of their cryptocurrency positions.
As a result of this news, traders flocked to withdraw their funds from the Exchange fearing it would be shut down. A total of USD$23mil was withdrawn from BitMEX in a single hour and so far over 45,000 BTC has been withdrawn. According to data from Crystal Blockchain, other centralized exchanges benefited from this mass exodus from BitMEX, with around 20,000 BTC going to Gemini, Binance, OKEx and Huobi Exchanges.
It is unknown how the legal proceedings and events will unfold. Most importantly, no one knows whether BitMEX operations and accounts will be frozen. So users of the Exchange may want to consider withdrawing their cryptocurrencies just in case.
Bitcoin resilient against negative news hammer
Prices of Bitcoin were unmoved by the KuCoin hack, but took a dip upon the news of the legal proceedings against BitMEX. Even news that US President Donald Trump testing positive for COVID-19 did not significantly shake prices for long. During this week and despite the generally negative news, Bitcoin prices appear to be on the way to recovery. This has led to some analysts taking the view that professional and retail investors remain bullish on Bitcoin and the ongoing upwards trend to USD$12,000 could return sooner rather than later.
Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.
Around 50 notable names in the crypto Twitter space were caught red-handed for essentially orchestrating a pump and dump scheme.
This started when they apparently missed out on the $MEME airdrop and so decided to “redeem” themselves…at the expense of others. Their plan, known as “The Experiment” was to create a new flash mob project called $FEW. There was not much of a plan in terms of launching the project or what it was about. But, there was a clear intent to airdrop the token to their fellow members who would promote it on Twitter to pump up the price of $FEW. Afterward, the members would proceed to sell their airdropped tokens and walk away with a few extra bucks in their pockets.
However, SOMEONE leaked screenshots of the private Telegram discussion to the public. Needless to say, the public went into an angry frenzy, with Anthony Sassano (@sassal0x on Twitter) getting the brunt of the anger as the screenshots showed him saying their project needed “people to dump on”.
Members of the group quickly came to say that “The Experiment” was a joke. When the public wasn’t satisfied with that explanation they also claimed they were going to donate all their profits from the project. Sassano eventually admitted his initial explanation that it was “a joke” was weak and apologised. However, he maintains he did not think $FEW was a scam since he saw some notable influencers in the Telegram. He also burned his $FEW to assure the public he was not going to dump the tokens on them. Other members such as Alex Masmej also insisted that no harm was actually done since the token was never listed and that he had also burnt his $FEW.
However, this wasn’t a joke to some people as they actually ended up buying $FEW because of the influencers’ promotional posts on Twitter. Others, seeing that $FEW wasn’t listed on any exchange yet, tried to profit off the hype by listing fake $FEW trading pairs on Uniswap in an effort to get some members to trade.
The public may have moved on for now seeing as how quickly trends come and go in crypto, but the $FEW incident had just confirmed and exposed what many of us had been suspecting for a long time.
KuCoin gets hacked
KuCoin confirmed on 26th September 2020 in a Twitter post they had detected huge withdrawals of BTC and other tokens from their hot wallets out of the Exchange. It is estimated that the withdrawals are around USD$150million worth, a “small amount for KuCoin” according to a Livestream they did shortly after the hack was confirmed. The Exchange is still trying to investigate how the withdrawals came about, but they are reassuring the public that their funds are safe and they will cover any losses suffered by the public.
They also mentioned they are working with other exchanges to track down the flow of the stolen funds and stop them from being disposed of on the market. Kucoin will also be temporarily suspending all withdrawals from the Exchange “until next week”.
The moral of the story is, take your cryptocurrencies off exchanges and store them offline in a hardware wallet. If you don’t have one yet, please consider getting one. Check out our Ledger Nano X review or buy it here.
NFTs suddenly becomes hot
This week, Non-Fungible Token (NFT) hype seemingly appeared out of nowhere and now everyone is trying to make NFTs and selling them for profit. But is it sustainable? Or is it just something to keep everyone entertained since the DeFi craze is cooling down? I invited Yat Siu, Co-Founder/CEO of Animoca Brands ($REVV) and Sandbox ($SAND) to debate whether NFTs are the next big thing, and I did NOT hold back in playing the devil’s advocate:
Upcoming events
26 Sep 1:00pm: Flamingo.Finance ($FLM) will resume Mint Rush. 28 Sep 8:30am:RioDeFi (RFUEL) will list on Uniswap at an initial price of $0.20 per token. 29 Sep 1:00pm: CryptoLocally ($GIV) will auction off 30mil GIV tokens (3% of total supply) less the whitelisted allocation of approx 1.5mil GIV. The initial price will be 0.0065 USDC/GIV and the auction interface will be revealed on the CryptoLocally website at the start of the auction. For those who want a head start, CryptoLocally allows you to place your orders on Mesa before the auction. 3 October (tentative): KuCoin will resume withdrawals from their exchange. But do check the KuCoin Telegram for the most updated info.
*All times are listed in UTC unless otherwise stated.
Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.
As we head towards late September, we see a significant cooldown on the profitability of Yield Farming. The days of 3 digital farms are gone, with yields now nearing ~50% APY for low-risk farms. Whilst some high yields still remain, the number of scams in the yield farming space has drastically increased. Overall, this is a healthier direction for the entire space.
Week in review
YFValue is evolving-but is it for the best?
YFValue will be going through a lot of changes in the coming few weeks. Here’s a summary:
15th September 2020 at 2:00pm UTC: Governance Vault (beta) opened and is intended to replace Staking Pool v2. It is supposedly an upgrade because the YFV staked in Governance Vault will now also be farming for yield. Profits would be used to buy back VALUE and distributed to stakers.
16th September 2020: YFValue’s new token VALUE deployed. The total supply of VALUE is capped at 3mil. A swap portal will soon be opened for holders to swap their YFV to VALUE.
18th September 2020: Value Liquid exchange will be launched. All liquidity from YFV pools will be automatically migrated from Balancer to Value Liquid. Balancer Pools will stop issuing YFV.
21st September 2020: Value Vaults will be available. Currently, it is known that after its release, 6.8% of profits from Value Vault’s strategies will be used to buy VALUE and distributed to Governance Vault Stakers. However, full details of what Value Vaults do are not announced yet.
2nd October 2020: Stablecoin seed pool’s double inflation rate will end.
Yieldfarming.insure- DeFi drama on x4 speed
Yieldfarming.insure ($SAFE) was only launched on 14th September 2020 and was all the buzz in various telegram groups. Shortly after launch on 15th September 2020, prices for $SAFE shot up to over USD$4,200 at its peak. However, the next day its developer “Chefinsurance” (“Chef”) published a lengthy message about the drama happening behind the scenes.
Turns out there was some conflict between Chef and “AzeemFi” (“Azeem”), apparently in investor into Yieldfarming.insure. According to Chef, Azeem insisted to deploy Pool 4 earlier than planned and eventually forced Chef to do so. Minutes after deployment, Azeem apparently realising he may be exposed to the risk of impermanent loss suddenly withdrew all his liquidity from Pool 4, essentially locking that pool and rendering it unusable. Azeem apparently then messaged community members to backstab and shift the blame for the issues on Pool 4 onto Chef. He also allegedly plans to oust Chef and was dumping his $SAFE tokens on the market.
Soon after Azeem issues his own reply that Chef is not truthful and posted message histories between himself and Chef. According to Azeem, he had only later discovered that Chef had created a clone farm and there was no actual product at all. Further, he insists he did not tank Yieldfarming.insure and instaed was trying to save it. Furthermore, the $SAFE tokens were according to Azeem “fairly farmed” by him and he had sold them to “take fairly farmed profits”.
Only 24 hours later and apparently Chef and Azeem have reconnected and are prepared to put aside their differences and reconcile.
From the latest update, it appears that Azeem would be stepping away from the project entirely. Meanwhile, Chef will be taking a break from his university studies and was given a grant of USD$25,000 and 5ETH from Andre Cronje and BlurKirby.eth to focus on the project.
The new project, known as COVER will be fully built from the ground up and will allow users to buy and sell cover on anything on a decentralised and scalable platform. Their MVP is expected to be available for beta testing by 1st November 2020.
As for SAFE holders, they will be able to migrate to $COVER through a smart contract after the completion of the beta tests for COVER.
$UNI-versal free lunch
Uniswap dropped a (welcome) bomb on 17th September 2020 when it launched its community token $UNI. Anyone who used Uniswap (including failed transactions) will be able to claim 200 UNI tokens for FREE. For those who provided liquidity to the platform, Uniswap will award you with even bigger bonuses. Check out our video below on how you can claim your free lunch:
Claim Free Uniswap ($UNI)
Exchanges saw how hot these free lunches were going to be and immediately raced to list UNI. Currently, UNI is listed on FTX, Binance, KuCoin, OKEx, Poloniex etc. Prices for UNI were also on an upwards trajectory, with UNI going to USD$8.40 at its highest.
However UNI is still at its early stage and it needs to be seen the approximate range at which prices will be. Hence we hear a lot of people in the community saying that they will hold onto their UNI for now with a “wait and see” approach.
Ledger hardware wallet sale!
LAST FEW DAYS! Ledger is offering 20% off on their Nano X and Nano S cryptocurrency hardware wallets with promo code: backtoschool. Offer is only available from 7-21st Sept 2020. Click below to buy!
Upcoming events
21st September 2020: YFValue’s Value Vaults will be available. 23rd September 2020: Flamingo.finance’s yield farm, Flamincome will launch.
Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.
What is Crust Network?Crust Network implements the incentive layer protocol for decentralized storage. It is adaptable to multiple storage layer protocols such as IPFS, and provides support for the application layer. Crust’s architecture also has the capability of supporting a decentralized computing layer and building a decentralized cloud ecosystem. At present, public testnet Maxwell CC2 is live, and everyone is welcome to participate in the testnet. Crust Network successively joined Substrate Builders Program and Web3.0 Bootcamp, and also obtained a Web3 Foundation Grant.
Who is Leo Wang? Leo is the Co-Founder of Crust Network, leading products and technologies. Leo is experienced in distributed storage, cloud computing and blockchain areas. Leo worked in Microsoft and Cisco as their Development Lead. In Cisco Leo also led a blockchain-based project to store and exchange manufacturing data in different geo-locations.
This video is aimed at all levels of cryptocurrency enthusiasts so feel free to ask Leo your burning questions about Crust Network and this space in general.
I will personally be giving out prizes for the best 3 questions. To ask a question, leave a comment in this post below!
Event Time: 17th September 2020 at 3:00am (UTC)!
Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. (Clonazepam) Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.
This article is for information purposes only and is not intended to comment on the viability of FalconSwap (FSW). As with any cryptocurrency projects it involves a huge amount of risk. Anyone intending to participate should do full research and consider carefully the risks involved beforehand.
FalconSwap ($FSW) is a layer-2 scaling solution built on Uniswap and further extendable to aggregate other Decentralised Finance (DeFi) platforms like Mooniswap, Kyber, Balancer, Airswap, and Bancor. It aims to solve the ongoing issues in the Ethereum ecosystem like high transaction fees, slippage in trading, lack of privacy, slow transactions, and poor user experience.
Summary
The platform promises to offer features like Layer-2 Order Matching, DEX Aggregation, Lower trading fees, Low Slippage, Additional Privacy, and Faster Transactions.
The FalconSwap (FSW) tokens are designed to incentivize token holders and platform users by offering Fee discounts, Staking rewards, Token burns, and Liquidity mining features.
Potential Red flags include lack of a Whitepaper and roadmap, no public Github profile, an anonymous Team, and Investor uncertainty.
Can the team overcome these hurdles to capture market share from the existing players and establish themselves as the go-to solution for Ethereum scaling?
What is FalconSwap trying to solve?
DeFi platforms have gained immense traction in the 3rd quarter of 2020. As per data from DeFi pulse, the total value locked in DeFi protocols has surged from close to USD$1 billion in June to $9 billion in September. Uniswap has emerged as the most sought-after platform to trade and swap digital assets on the Ethereum blockchain. On August 30, 2020, Uniswap became the first decentralised exchange (DEX) to overtake the biggest US-based crypto exchange, Coinbase.
However, as the DeFi community continues to push their activity beyond network limits, congestion on the network has led to an increasing number of unconfirmed transactions, longer wait times, and higher fees as users compete to get their transactions confirmed faster, making it an extremely crucial roadblock for the future of Ethereum as a smart contract platform. Ethereum Gas fees have skyrocketed in recent months with over 5,869 ETH (US$2.17 million) spent as per the latest data from Glassnode, with fees as high as 15,374 ETH (US$ 3.5million) recorded on June 11, 2020.
There is therefore an immediate need to solve the Ethereum scaling issue to enable users and projects make the most of the growing DeFi ecosystem. This is where FalconSwap aims to provide a solution.
FalconSwap overview
Calling itself the “The Powerhouse for DeFi”, FalconSwap operates as a second layer solution on Uniswap and other DeFi platforms. It aims to solves the ongoing issues of high transaction fees, slippage in trading, lack of privacy, slow transactions and poor user experience in the Ethereum ecosystem. This it plans to do by offering the following features:
Layer-2 Order Matching: Orders are matched in Layer-2 and aggregated before accessing the liquidity from Uniswap pools.
DEX Aggregation: Orders are aggregated across multiple liquidity pools like Uniswap, Mooniswap, Balancer, Kyber, and so on.
Lower trading fees: Aggregating orders distribute the transaction fees across multiple users thereby lowering fees per user.
Low Slippage: Aggregating platforms provide a larger liquidity pool to execute orders thereby lowering slippage in trading.
Privacy: Layer-2 orders matching occurs without on-chain knowledge of the trade.
Faster Transactions: Faster transactions powered by the aggregating and executing of several trades in Layer-2.
To understand this better, let us assume there are 3 buyers buying 2 ETH, 3 ETH and 5 ETH worth of tokens respectively, and 3 sellers selling 6 ETH, 6 ETH and 8 ETH worth of orders respectively.
Using the current trading approach on Uniswap, every user would pay for their own gas fees and the total fees spent would be 6x the gas fees per order. User might also experience transaction slippage and even higher fees if their orders are distributed among multiple liquidity pools.
However, when the above-mentioned trades are placed and executed on the FalconSwap platform, the protocol would aggregate 6 orders matching the 10 ETH worth of buy orders with 10 ETH worth of sell orders. The remaining 10 ETH worth of sell orders will then be sent to Uniswap or distributed among different liquidity pools. This would help optimize gas fees per user and minimise slippage.
FalconSwap token ($FSW)
FalconSwap tokenomics are designed to incentivize users and token holders in the following manner:
Fee discounts: FSW token holders get additional fees discount of up to 50% to use FalconSwap over and above the fee savings from Layer-2 trade execution.
Staking: A part of the fees collected from the FalconSwap protocol will be used to buy FSW tokens from the market and distributed to the FSW token staking holders.
Token burn: FSW is a deflationary token. 10% of the fees collected will be used to buy FSW tokens from the market and burned.
Liquidity mining: Users mine FSW tokens when they trade on FalconSwap.
As at September 4, 2020, FSW token ranks 381 out of 5890 coins listed on CoinGecko. The current token circulating supply is 33 million with a max supply of 100 million. The FSW Token are currently available for purchase on Uniswap V2 (ETH/FSW) and Hotbit exchanges.
FalconSwap testnet results
On August 27, 2020 the team reported successfully completing their first milestone, which was to build a decentralized protocol to aggregate orders on Uniswap and publicly shared the test net results with the community. As per the results, trading on FalconSwap offered Gas savings of approximately 64% per transaction when compared to Uniswap.
Potential red flags: Is FalconSwap legit?
FalconSwap has several aspects to it which makes us question the legitimacy of the project, for example, the lack of whitepaper and Github. We also have concerns about the fact that the team is anonymous and queries whether they are indeed backed by the investors as claimed. Concerning these questions, we contacted the FalconSwap team and they were kind enough to promptly respond. Below are details of our concerns on FalconSwap and the response from the team.
No whitepaper
Undoubtedly the most important document for any upcoming project is a detailed and structured whitepaper with a clear road map for potential investors. It is the first litmus test a project needs to clear to be considered trustworthy. FalconSwap has not yet published its whitepaper to the community.
According to the team, there is no white paper because the team is already aiming to launch the final product by the end of September 2020 and have partnered with companies like DEX Tools for initial liquidity mining, trading, and integrations. The roadmap is set to be presented along with the product launch.
No Github
Most projects today have an active Github profile where they regularly provide updates to the progress on their code for peer review and fault identification by the community. FalconSwap doesn’t have any such public Github profile. As to this issue, the FalconSwap team says that their GitHub has not been made public so they can have an edge on competitors and avoid their code being copied. However, it will also be made public post product launch.
Anonymous team
Another potential red flag is that the team is anonymous. To be fair, there are some projects where teams opt to stay anonymous due to the threat of a potential government crackdown or operational risk. (Xanax) However, these projects overcompensate by being transparent on all the other aspects of their projects to magnify trust, which FalconSwap currently lacks. When we asked the team on this, they responded that they decided to stay anonymous to avoid any adverse effect on operations.
We note that whether investors or partners mention FalconSwap on their website or not is beyond the control of the FalconSwap team. From our further research, we note that TRG Capital Director Etienne VantKruys tweeted about FalconSwap. We also note that some of the FalconSwap community members did their own research and emailed investors to confirm the veracity of their partnerships with FalconSwap. It was confirmed by those Community members that they got positive responses.
Closing thoughts
FalconSwap clearly has identified an important issue plaguing the Ethereum ecosystem. Their Layer-2 transaction aggregation solution might be one of the best answers to scale Ethereum and lower fees. The team therefore has a very small window to bring the product into the market since the Uniswap team are also working on their Layer-2 solution expected to be launched later this year.
Moreover, healthy competition is expected from the newly launched Polkadot protocol which already enables cross-blockchain transfers of any type of data, asset, or tokens along with transactional scalability by spreading transactions across multiple parallel blockchains. Ethereum itself could scale very soon, unclogging the network, lowering fees and boosting transaction speed, leaving very little incentive to use the FalconSwap platform in the future.
However, if the team delivers by launching the platform within the promised timeline and make the code publicly available to the community, it can surely capture significant market share from the existing players, gain community trust and establish themselves as THE go-to solution for Ethereum scaling.
Decentralised Finance (DeFi) series: tutorials, guides and more
With content for both beginners and more advanced users, check out our YouTube DeFi series containing tutorials on the ESSENTIAL TOOLS you need for trading in the DeFi space e.g. MetaMask and Uniswap. As well as a deep dive into popular DeFi topics such as decentralized exchanges, borrowing-lending platforms and NFT marketplaces
More videos and articles are coming soon as part of our DeFi series, so be sure to SUBSCRIBE to our Youtube channel so you can be notified as soon as they come out!
Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.
Ethereum is one of the easiest cryptocurrencies to mine, using idle computer resources to earn daily revenue in Ethereum (ETH). This is especially true if you have a high end computer, as they usually have the necessary hardware to mine Ethereum. This guide will cover the basics of Ethereum mining and will get you started in less than 5 minutes. In order to get mining, you’ll need a Graphics Processing Unit(GPU). GPUs are usually in gaming computers and high-end computers (eg MacBook Pro or Dell XPS). Miners frequently sell mined Ethereum on top cryptocurrency exchanges or Over-the-Counter to generate passive income.
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Ethereum (ETH) is the cryptocurrency used on the Ethereum network – decentralized smart platform for running decentralized applications (dApps) and decentralized finance (DeFi). To learn more about Ethereum check out our Ethereum Guide.
Note: If you don’t have a GPU, check the bottom section of this guide and we’ll teach you how to buy and install one.
Note 2: In 2021, Ethereum will deploy a new consensus mechanism called Proof of Stake that no longer requires mining. This will eventually phase out mining on Ethereum all together. Read more about Proof of Stake.
How Profitable is Ethereum Mining?
Daily Revenue from mining rewards differ everyday – this is because mining difficulty changes and hence the daily reward. Revenue is dependent on the power of the Graphics Processor Unit (GPU) involved, with higher Hashrates being faster and more profitable. There are two major manufacturers of GPUs: Nvidia and AMD. Generally speaking, the more powerful (and expensive) the GPU higher the Hashrate for mining Ethereum. For example, the expensive Nvidia RTX 2080 mines at 36.90 MH/s whilst the less expensive Nvidia GTX 1660 mines at 20.50 MH/s. Check out the latest up-to-date daily revenue for different hardware on https://whattomine.com.
Daily Revenue
Yearly Revenue
Nvidia RTX 2080
$0.50
$182
Nvidia GTX 1060
$0.30
$109
AMD Vega64
$0.54
$197
AMD RX480
$0.40
$146
Potential Revenue mining Ethereum (Calculated on Oct 29 2019)
We calculated the costs and profits for mining Ethereum, and how does it compare to Ethereum staking? Which one is better?
Ethereum mining vs staking: Which one is more profitable
Easiest way to mine Ethereum (Honeyminer)
Honeyminer is an all-in-one mining solution that automatically mines on your computer without any technical knowledge. Honeyminer automatically joins a mining pool, so you can get daily payouts of the revenue you generate from mining.
Once installed, the software will automatically mine the best cryptocurrency (including ethereum) using all available hardware – both CPU and GPUs available on the machine. To see the daily revenue, open up the “see full activity panel” to get a breakdown of the hardware being used.
When Honeyminer is running, the computer’s hardware will get 100% utilized. It’s still run simple tasks on the computer, like web-browsing or composing emails. However, running video games or editing photos/videos will become slower. It is advised to turn-off honeyminer when doing resource intensive tasks.
It is important to note that Honeymoney will mine the most profitable cryptocurrency at the time (including ethereum) and convert the revenue into Bitcoin (displayed in Sats, satoshi). If you want to specifically mine ethereum and earn ethereum, check the advanced guide below.
One disadavantage of Honeyminer is the platform fees. Currently, Honeyminer takes 8% fee for the 1st GPU and 2.5% for additional GPUs. This means a portion of the revenue will go to Honeyminer. If you don’t want to pay platform fees, you can try the advanced Ethereum Mining option
To mine Ethereum, you can easily use any modern operating system: Windows 10, MacOS and Linux. For beginners, it’s suggested to try out HoneyMiner on either Windows 10 or MacOS to get the feel of mining. This is because it’s the easiest to setup up and can work alongside regular tasks on the computer. For higher mining performance, a dedicated linux based operating system is recommended – this allows for optimisation of the caching properties and remote management. Currently popular custom mining OS include: HiveOS, NicehashOS and ethOS.
How to Mine Ethereum (Advanced)
Claymore’s Dual GPU Miner
There are 3 main software miners for mining Ethereum. For each of the Ethereum mining software, there are advanced settings possible such as customization for the memory usage, caching and efficiency. For example, Claymore’s Dual Ethereum miner have advanced options such as optimized memory timings (increase performance by ~10-20%) and support for mining pools. Top 3 Ethereum miners are:
To setup Ethereum, you need to have an Ethereum address. In order to get an address, you can look at our Enjin Wallet for a free software wallet or Ledger Nano X – a secure hardware wallet.
Ethereum Pool Mining
There are two main ways to mine ethereum – solo mining or pool mining.
Pool Mining (working together)
Work with others to mine and share rewards
Get paid per share, on a hourly or daily basis
Less random / dependent on luck
Pools take some fees (0.5-3% depending on pool)
Solo Mining
You mine the entire block reward (3 ETH per block) – no pool fees
Random Chance and probability – you can go days or months without rewards
Not viable if Hashrate is low – single GPU will take years to mine a block
Top Ethereum Mining Pools
There are 2 factors to consider when picking a Ethereum mining pool – the location of the pool and it’s market share. The top priority would be location – the closer the pool is to you geographically the better. This is because sometimes due to network latency, shares that are mined could be “stale” – as new blocks are created rendering older blocks obsolete. It’s also important to know that Chinese servers are behind the Great Firewall of China, meaning that connections could periodically break. This means that choosing a server with low latency and close geographical location would give the highest yield.
The second factor is the market share of the pool. The larger the market share, the more consistent the rewards. This is because blocks are continuously mined by the pool, and hence they can pay out at a consistent rate. This reduces the impact of the randomness of block creation.
We recommend finding a pool close to your location with a high market share.
Is it possible to solo mine Ethereum in 2020
Currently it’s not feasible to solo mine Ethereum in 2020. It would take 67 years to solo mine a block (assuming 30 MHash/s and current total hashrate of 181 THash/s). This would mean it would likely take an entire lifetime before the solo miner finds a block with a single GPU.
How long will Ethereum be able to be mined
With the upcoming changes coming to Ethereum 2.0, Ethereum mining will eventually be phased out. Mining will be deprecated in phase 3 of the ETH2 roadmap, expected to come sometime in 2022 at the earliest. At this point, there will no longer be any rewards for mining Ethereum as the network will full be proof of stake.
Ethereum Cloud Mining
In 2020, Ethereum Cloud mining contracts are not profitable. This is because mining has become more competitive with lower margins – forcing miners to reduce costs. Cloud mining is hit the hardest because of they have large overheads like advertising spends and legal costs. In our latest research, we found that cloud mining providers were charging 184% for the same hashrate than home-made solutions.
What is Ethereum ProgPoW and how does it impact mining
ProgPow is a proposed extension to the mining algorithm of Ethereum, designed to resist centralization of miners via ASICs (specialized mining equipment). The ProgPoW upgrade is meant to help Graphics Cards become more competitive by using more RAM and features unique to the GPU. Overall this will help Ethereum mining be more accessible and viable with commercial off-the-shelf hardware. Currently ProgPoW is in an ‘audit’ phase, and if passed will be included in Ethereum’s next hard fork.
Ethereum Mining Difficulty Bomb
Ethereum network has a built in mechanic to decrease the effectiveness of mining over time called the “Ethereum Difficulty Bomb“. This is designed as a hard mechanic to ensure that Ethereum eventually moves to proof of stake, an eco-friendly consensus mechanism that doesn’t require mining. Proof of stake will be part of Ethereum 2.0 which is stated to release in 2020, at which point mining on Ethereum will slowly be phased out. However, the Ethereum team is known to delay the deployment of proof of stake and consequently the difficulty bomb. On the 6th of January 2020, the difficulty bomb was delayed once again via the “Muir Glacier” update, which effectively delayed the difficulty bomb for another ~600 days.
Update 9th Jan: Fixed typos and included extra information about Ethereum Hashrate
Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.
RAMP DeFi seeks to open more yield farming opportunities for users who have already staked their tokens on non-ERC20 platforms and thus enabling them to maximise their leveraged positions. Staking is the practice of locking-up funds in either smart contracts or by purchasing tokens from decentralised finance (DeFi) platforms for the purpose of earning profits at a later date. However, this also implies that the staked assets could not be used for whatever purposes users want unless they are willing to let go of their positions. RAMP DeFi aims to change this and let users continue to flexibly use their liquidity even when their capital is locked into staking arrangments.
Background
The explosive success of DeFi ecosystem, surpassing $13 billion market in value, has allowed multiple projects to flourish in response to its growing demands. However, the problem still exists in terms of convenience, accessibility, and flexibility.
Lawrence Lim, Co-founder of RAMP DeFi led the creation of an ecosystem that seeks to solve these problems. With the concerns of the DeFi space in mind, RAMP was conceptualized to provide users the opportunity to maximize the value of their staked assets with optimized flexibility.
As of now, RAMP has the potential to unlock $22 billion in assets staked in the DeFi space. However, its humble target by the end of 2021 is to reach at least $1 billion in Total Value Unlocked (TVU). TVU refers to the staked assets that RAMP seeks to open for potentially greater leverage.
Check out our interview with Lawrence Lim below:
Unlocking value on every blockchain-interview with Lawrence Lim
What is RAMP DeFi?
RAMP is a cross-chain liquidity on/off ramp platform focused on providing stakers of non-ERC20 tokens the opportunity to utilize these assets on top of the Ethereum blockchain. This is done through RAMP’s stablecoin, the rUSD, acting as a gateway bridge between non-ERC20 platforms and the Ethereum chain. Furthermore, users can also deposit their ERC20 tokens in RAMP’s liquidity pools to mint eUSD.
Both holders of rUSD and eUSD can access RAMP’s financial services such as lending, borrowing, and exchange between rUSD and eUSD. This on/off ramp allows users to make the most out of their staked assets even if they are locked in non-ERC20 platforms.
So far, its first private sale has been able to raise over $1 million. Some of its private sale investors include Alameda Research, Blockwater Capital, IOST, ParaFi Capital, Ruby Capital, Signum Capital, and Arrington XRP Capital.
RAMP Ecosystem
rMint and rStake
This is the platform where non-ERC20 tokens can be collateralized to mint rUSD. Collaterals designated to rStake are aggregated by different nodes on partner non-ERC20 blockchains. They also earn staking rewards for it.
eMind and eFarm
eMint allows the deposit of ERC20 stablecoins to create eUSD, a token that represents the value of the amount deposited by users. The deposited amount is transferred to eFarm in order to create yield farming opportunities for users.
rFinance
The platform’s lending and borrowing service is provided by rFinance. rUSD and eUSD holders can freely lend and borrow from each other. Moreover, oracles help keep the interest-rate setting at a fair level through formulas that revolve around demand-and-supply and market-relativity indicators.
rPool
RAMP has its own liquidity pool that allows users to build value for their assets, collateralization insurance, liquidation execution, and cross-chain swaps. rPool gains value from staking rewards, yield farming rewards, and revenues from fees, which are then later distributed to the holders of RAMP tokens.
In the event that rUSD suffers from a crash, rPool is first utilized to support its value. If the value of a user’s collateralized position drops below the allowed collateralization ratio set within the specific parameters, their positions are liquidated to the rPool.
rSwap
Users can swap ERC20 stablecoins with any other non-ERC20 token provided that these tokens are part of RAMP’s blockchain partners. They do this by facilitating the exchange of ERC20 stablecoins with the cryptocurrencies stored within the rPool. The conversion rate is set by price oracles.
RAMP Token
RAMP is the native utility token used to power the whole ecosystem value, as well as align the well-being of all network participants. On RAMP DeFi’s public sale, 10 million RAMP tokens will be sold to participants. The date of this public sale is not yet announced. After the sale, RAMP is slated to be listed on Uniswap.
RAMP is powered by an ecosystem composed of different DeFi projects that also enables its cross-chain value accretion. Parts of its ecosystem are designed to respond to every transaction interaction between the users and the blockchain.
RAMP Token public sale
The RAMP token public sale date has not been announced yet. Check their official telegram for the latest news.
rUSD Stablecoin: What is it?
rUSD is RAMP’s stablecoin backed by non-ERC20 tokens designed to interact with ERC20 stablecoins like USDC, USDT, and TUSD. Minting rUSD follows a collateralization ratio similar to MakerDAO in order to ensure that they are fully-backed.
The minimum collateralization ratio is at 200%. For example, a $200 worth of non-ERC20 token can be used to mint $100 worth of rUSD.
The liquidation ratio starts at 120%. If liquidation is triggered, the collateralized tokens are then sold to the rPool. Then, these tokens will be used to buy back the rUSD minted by the user whose position is being liquidated.
Benefits of holding rUSD and eUSD on RAMP
For rUSD holders:
Leverage value from non-ERC20 tokens staked in other blockchains without giving up their existing positions.
Access ERC20 opportunities, such as yield farming or trading, without having to put in more of their assets.
Receive staking rewards even when they have minted rUSD.
Maintain potential revenue from existing positions and collateralized portfolios.
Farm RAMP tokens after collateralizing their cryptocurrencies to mint rUSDs.
eUSD holders can enjoy:
Interest fees from lending their assets.
Participate in multiple yield pools to farm.
Opportunity to farm yields from other DeFi projects partnered with RAMP.
Farm RAMP tokens by providing assets to RAMP’s liquidity pool.
Advantages of RAMP DeFi
RAMP offers some unique advantages over other cross-chain DeFi platforms.
rUSD Has a Clear Purpose
The RAMP team has recognized that initiating adoption for a stablecoin is no easy task. For instance, it took a substantially long time for Makerdao to drive DAI’s broad market acceptance.
For that reason, they have issued the stablecoin rUSD with a core utility as a value stability bridge.
rUSD Requires No Stability Fee
Paying stability fees is common among DeFi protocols as it helps in cushioning from massive market plunges. And we’ve witnessed the fees to go ultra-high, especially during a bear market.
Fortunately, the RAMP DeFI platform does not incur a stability fee when minting rUSD. This enables users to access RAMP with less friction and save more.
Has Contingencies in Place in the Event of a Flash Crash
A flash crash is an unlikely occurrence where the value of assets drops significantly in a very short period of time, resulting in the under-collateralization of rUSD. In such an event, RAMP will utilize the universal liquidity pool as collateralization insurance for the stablecoin.
Rapid Scaling Integration Layer
Being a bridge to isolated blockchains, the value of the RAMP network increases with every new chain added to it. For this reason, the RAMP ecosystem has been made accessible to various developers from different blockchain foundations to encourage its adoption.
This enables the foundations to easily integrate their native stablecoins onto the RAMP ecosystem, which would result in RAMP’s fast growth.
Conclusion
The purpose of DeFi is to unlock the potential of the blockchain and the power of money to the benefit of the community and its users. RAMP is a promising development in that particular aspect.
Its feature opens up possibilities for ERC20 and non-ERC20 tokens to interact with each other to provide a new opportunity for users to earn from the assets that they are putting into DeFi protocols. Not only does it attract existing stakers into the platform, but also expands the channels where crypto users can do yield farming.
Decentralised Finance (DeFi) series: tutorials, guides and more
With content for both beginners and more advanced users, check out our YouTube DeFi series containing tutorials on the ESSENTIAL TOOLS you need for trading in the DeFi space e.g. MetaMask and Uniswap. As well as a deep dive into popular DeFi topics such as decentralized exchanges, borrowing-lending platforms and NFT marketplaces
More videos and articles are coming soon as part of our DeFi series, so be sure to SUBSCRIBE to our Youtube channel so you can be notified as soon as they come out!
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