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  • What are “Money Legos” in DeFi? Composability Explained

    What are “Money Legos” in DeFi? Composability Explained

    What is Composability in DeFi?

    Decentralized finance (DeFi) has revolutionized financial services, creating new possibilities unlike anything that exists in traditional banking. DeFi protocols allow you to transfer value, exchange tokens, take out loans, provide liquidity, earn yields and so much more. As the market expands, it is likely that even more innovations will surface.

    This is because of how smart contracts work. The open-source and permissionless nature of blockchains allows anyone to code their own contracts or even integrate a component of another protocol in their own application. As a result, the applications built on a smart-contract network can run interchangeably.

    This is known as “composability” — the interoperability of DeFi protocols resulting in efficient and creative financial services and products for users. It is the core basis of DeFi and is what helped the ecosystem grow so quickly.

    What are “Money Legos” in DeFi?

    To understand how composability works in DeFi, we can view components of DeFi protocols as Lego blocks, giving rise to the term “money legos.” Each building block has its own functionality such as borrowing, lending or staking assets, just to name a few. Developers can stack multiple protocols together like Aave, Compound, Yearn, Curve or Synthetix to create a new DeFi protocol, just as you would a Lego set.

    For developers, money legos save a lot of time and complications around building a new decentralized application (DApp). They do not need to start from scratch as they can simply integrate existing money legos into their own. What money blocks provide are solutions to more complex processes which require more steps than usual.

    Moreover, developers can build smart contracts that can operate the legos in any order, be it one before or after the other, or in parallel. For example, by joining the money legos together and then specifying the order of events through a smart contract, users could

    1. Put up collateral for a loan on Aave
    2. Stake half of the loaned amount on Curve
    3. Trade half of the loaned amount on Uniswap
    4. Pull out both amounts simultaneously and take profit
    5. Pay off the loan on Aave

    This is just one type of scenario. As you can see, there are infinite possibilities with money legos. It is up to your creativity how much use you can make of the combination of their functions to optimize your crypto. Furucombo is a great platform to experiment different possibilities of DeFi money legos.

    Why “Money Legos” Matter?

    “DeFi” is a buzzword that gets thrown around a lot. People often associate DeFi with low fees and yield farming, but do not exactly know how the underlying infrastructure works. Therefore, it is important to learn about money legos as they are the building blocks for programmable money, hence its name. While developers can compare and choose specific DeFi protocols to cut down on fees when building new applications, investors can better optimize and manage their crypto by having a better understanding of money legos.

    As savvy investors, we know that key performance indicators (KPI) of a healthy market and ecosystem are trading volume and activities. As such, money legos are powerful tools that can expand the potential possibilities of the ecosystem. They add to the utility of each existing protocol, while improving the blockchain’s network effect.

    In other words, each time a new protocol is created in the DeFi space, a new money lego is born that can also be used to offer more new services within the sector. These new protocols will offer faster and more efficient services, giving investors more ways to generate profit. For each new money lego, hundreds or thousands of new combinations become possible.

    However, as of now, composability mostly favors protocols of the same blockchain. For example, DeFi protocols on Ethereum can only interact with other protocols on Ethereum. Same goes for Solana or Cardano. Perhaps in the future, true multi-chain interoperability will allow protocols on one blockchain interact with a protocol on another blockchain. This means that crypto will become more accessible, further increasing their adoption.

    Risks of “Money Legos” Composability

    Since DeFi protocols can seamlessly integrate with each other, this means that the entire ecosystem hinges on each of its money legos. If one of the core money legos is compromised, it could lead to a chain reaction, potentially affecting other integrated applications.

    This is possible because of the interoperability between the DeFi protocols. For example, you can carry out complex strategies like borrowing Synthetix (SNX) from Aave, depositing SNX into Synthetix to mint sUSD, then swap sUSD for DAI on Curve. Now if any one of these protocols is attacked, then all of their liquidity pools will be severely affected.

    Moreover, certain protocols also have wrapped crypto tokens (e.g. WBTC, renBTC, wETH) that are pegged to the value of another crypto. This means that you not only have to trust the protocol you deposit your funds to but all the others it may be reliant upon.

    Key Takeaway

    It is important to understand money legos as they are the building blocks of the DeFi ecosystem. Money legos help developers create new protocols, offering faster and more efficient financial services for DeFi end-users. It also helps investors get the best trades and the best yields when it comes to earning from DeFi protocols. That is the whole concept behind the idea of composability. Seamless interoperability among components helps to build the best and most creative solutions.

  • APY vs APR in DeFi: What They Actually Mean for Your Rewards

    APY vs APR in DeFi: What They Actually Mean for Your Rewards

    As savvy investors, it is easy to get carried away by flashy numbers like 1000% staking rewards. But what most beginners overlook is the three little letters standing right next to it: APY or APR.


    Although APY and APR may sound identical, there is a significant difference to the calculations for returns over a period of time. There are also underlying risk factors of certain decentralized finance (DeFi) products with very high return on investment (ROI).


    Therefore, it is crucial that you have a better understanding of the formulas used to generate these two measures as well as what they signify for the potential returns on your crypto investments.

    What is APR?

    APR, which stands for annual percentage rate, is interest you gain from your investment in a year. It is also known as “simple interest” and its formula is straightforward.

    For example, if you stake 10,000 USDT at an APR of 10%, you will earn $1,000 in interest after a year. Your interest is simply calculated by multiplying the principal amount ($10,000) and the APR (10%). In a year, your capital will amount to $11,000, and in two years, it will be $12,000, and so on.

    See also: The Pros and Cons of Stablecoins: Why You Need To Know How They Work

    As such, APR is always quoted as a fixed yearly rate, thus a simpler and more static metric. However, with APY, interest calculations become slightly more complicated with compounding taken into account.

    What is APY?

    APY, short for annual percentage yield, is the annual rate of compound return earned on an investment. The keyword here is “compound.”

    What is Compound Interest?

    Compound interest is not only earning interest on your initial investment, but you are also earning interest on the accrued interests. This effect is called “compounding.”

    A simple scenario would be like this. Let’s say this time you stake 10,000 USDT at an APY of 10% compounded monthly. This means that interest is added to your principal sum each month, and the sum on which you earn interest increases over time. In other words, you will have more money earning interest each month.

    In one year, your capital will amount to $11,047.13, which is $47.13 more in interest by adding the effect of compound interest.

    The Power of Compound Interest

    The aforementioned scenario is an instance of monthly compounding. In fact, there are different compounding periods depending on the institution. Interests can be compounded quarterly, monthly, week, or daily.

    The more frequent the compounding periods, the higher your effective yield is going to be. For example, if your staked 10,000 USDT is compounded daily at 10% APY, then you will earn $11,051.56 in one year, which is $4.43 more than monthly compounding.

    It may not seem like a big difference but the power of compounding is more significant over more extended periods. After five years, you will have earned around $16,500 if compounded, which is $1,500 more than simple interest.

    APY vs APR vs No Invest (Source: DataDrivenInvestor)

    As illustrated in the graph above, the APR line is linear, whereas the APY line is exponential, which is always higher than the linear as time progresses. The principal remains the same if no investment is made.

    You can use an APY calculator to calculate how much you can earn with different compounding periods and different time frames.

    How does APY Work in DeFi?

    The previous section is a simplified example of how compound interest works in general. However, APY investments work differently in DeFi. APYs in the crypto space constantly change due to several factors. As such, as a rule of thumb, the APY shown on DeFi products should be considered as estimates.

    Supply and Demand

    As with any market economy, the law of supply and demand influences the assets’ price. Since interest is generated based on the demand to borrow and trade crypto, market dynamics play a role in determining the rates.

    Since the crypto market is volatile in nature, the APY changes according to the level of demand for trading liquidity of the token. If there is plenty of supply, APY interest rates tend to be lower. Conversely, if the demand is high, the APY usually increases as well.

    Inflation

    Inflation refers to the loss in value of a currency over time. In crypto, inflation is brought about by adding new tokens at a predetermined rate to the blockchain. The rate of inflation affects the staking returns. If the inflation rate exceeds the interest earned on a staked token, then the investor is losing money.

    Different Compounding Periods

    Different projects have specified blockchain protocols which play a part in the calculation of the APY. As a result, compounding periods may vary for each project. For example, some projects compound interest weekly, daily, or even according to the mined block per block cycle. It is important to note that the more frequent the compounding periods, the higher the APY will be.

    Most crypto projects offer shorter compounding periods, with weekly compounding being one of the most popular ones. This is to help potential investors mitigate the effects of price swings in the long run, since crypto prices rise and fall over time. This way investors can do their compounding manually, and calculate their returns within specific time frames, so that they can strategize their entries and exits when engaging in DeFi protocols.

    Comparing APY vs APR Investments

    Although APY seems to be the obvious choice in maximizing ROI, there are also underlying risk factors when it comes to APY investments in general.

    Prevalence of Non-Sustainable APY Projects

    Projects with very high APYs, as high as 1,000% or more, are high risk/high reward investments. This is especially common for newly launched DeFi projects, because the price of a token is highly volatile during its early phase. To keep investors in the ecosystem, the project would provide trading pairs for the token also known as liquidity pools.

    Liquidity pools are one of the products that allow for staking and generating returns for providing liquidity. As such, projects will offer high APYs to offset impermanent loss, which occurs when the ratio of tokens in the liquidity pool is unbalanced. This also incentivizes users to continue providing liquidity instead of selling.

    However, there is a possibility of a dump for the project. Since most DeFi protocol tokens are inflationary in nature, the revenue capacity for the protocol might be insufficient for everyone to share. In other words, if everyone is earning 1,000% APY and the token has no real utility, it then becomes a race for the liquidity providers to see who cashes out first. As a result, this drives the token price and APY down, leaving real users of the protocol with no exit liquidity.

    Distinction of DeFi Product Yields

    Products with a higher APY will not necessarily generate more returns than those with a lower APR. It depends on what the APY and APR mean in relation to the DeFi product.

    Some products advertise the term “APY” referring to the cryptocurrency earned, and not the actual yield in fiat currency. Some beginners often mistake the APY crypto rewards for fiat currency, which blindly clouds their judgement.

    This is a critical distinction to point out because the value of your investment in fiat terms may increase or decrease depending on the volatility of crypto asset prices. Even if you continue to earn high APY in crypto, the value of your investment in fiat terms may still be lower than the initial amount you placed in fiat, should the price of the crypto asset decline.

    Key Takeaway

    APR (annual percentage rate) is interest you gain from your investment in a year. On the other hand, APY (annual percentage yield) is the annual rate of compound return earned on an investment, which means you earn interest on previous interests accrued.

    Although APY is the obvious choice in maximizing ROI, there are also underlying risk factors behind it. Therefore, it is crucial to comprehend how these two measures are determined as well as what it means for the potential returns on your digital investments.

  • Layer-1 vs Layer-2 Blockchain Scaling Solutions: What are the Differences?

    Layer-1 vs Layer-2 Blockchain Scaling Solutions: What are the Differences?

    What are Layer-1 and Layer-2 Solutions?

    Layer-1 refers to the base level of the blockchain’s underlying infrastructure. Bitcoin, Ethereum, Binance Smart Chain, and Solana are examples of layer-1 blockchains. These networks can process and finalize transactions on its own blockchain.

    On the other hand, layer-2 refers to a network built on top of a layer-1 blockchain. Its main purpose is to help offload computational work from layer-1s by processing transactions off-chain, increasing transaction speed and throughput. Polygon, for example, is a layer-2 solution that runs on top of Ethereum to facilitate transactions away from the mainnet.

    Layer-1 Overview

    Underlying Problems of Layer-1

    Scalability is the biggest issue that has been plaguing most layer-1 blockchains. As more users carry out increased simultaneous transactions, the blockchain becomes slow and expensive to use. Ethereum, for example, is the most used decentralized network, but its gas fees and process time are high.

    Blockchain Trilemma

    This is known as the “blockchain trilemma” — an impossibility for blockchains to simultaneously achieve decentralization, security, and scalability. As such, a decentralized and secure layer-1 blockchain cannot provide scalability. And a scalable, secure network lacks decentralization.

    This happens because of the fundamental nature of a blockchain. All transactions require the independent verification of the nodes who are running the blockchain’s software. The verified data will then be logged and stored on the blockchain.

    Transaction Confirmation Time

    However, depending on the network, this entire process takes time. For Bitcoin, all transactions require six confirmations in the blockchain from miners before being processed. The completion time varies between ten minutes and an hour. A node can only handle so much at a time. In times of network congestion, users will experience longer confirmation times and higher gas fees due to high demand.

    How do Layer-1 Solutions Work?

    There are several ways to increase throughput and overall network capacity of layer-1 blockchains.

    Transition to Proof-of-Stake

    For blockchains using proof-of-work as their consensus mechanism, they may switch to proof-of-stake to increase transactions per second while reducing gas fees. Ethereum is a great example of this as they are undergoing a transition to proof-of-stake called the “Merge.”

    The blockchain’s development team can also introduce a hard fork or soft fork of the network for their community to vote and approve:

    Soft Fork

    A soft fork is when new features are implemented to the protocol at a programming level. It is a backward-compatible upgrade, which means that the non-upgraded nodes will still see the chain as valid and can still communicate with other upgraded nodes. In other words, the addition of a new rule will not clash with the older rules.

    An example of a soft fork is Bitcoin’s SegWit update in which signatures are separated from transaction data, freeing up more space for transactions to be stored in a single block, increasing the throughput of the network.

    Hard Fork

    On the other hand, a hard fork is a major change to the blockchain’s protocol that results in the splitting of the blockchain, creating a second blockchain that inherits all of its history with the original, but is on its own towards a new direction. The new rules conflict with the rules of the old nodes, which means upgraded nodes cannot communicate with non-upgraded nodes.

    In July 2016, the Ethereum network hard forked into two blockchains: Ethereum and Ethereum Classic. Ethereum Classic is the old Ethereum with a completely seperate cryptocurrency (ETC). They have different technological and philosophical goals.

    Layer-2 Overview

    How do Layer-2 Solutions Work?

    Layer-2 solutions are built on top of a layer-1 blockchain to increase its throughput and overall network capacity. They work in parallel or independent of the main chain. Rollups and sidechains are two of the most common layer-2 solutions that help offload computational load from layer-1s:

    Rollups

    Rollups scale layer-1 blockchains by processing transactions on layer-2 platforms before submitting the results back to the layer-1. The term “rollup” refers to the way that the chain bundles many transactions to be submitted to the main chain.

    There are two types of rollups: Optimistic Rollups and Zero-Knowledge Rollups (ZK Rollups). The difference is in how they validate transactions.

    In short, Optimistic Rollups assumes that the transactions are valid, hence an “optimistic” outlook, whereas ZK Rollups attempt to prove that the transactions are valid.

    See also: Understanding Layer 2 & Scaling Solutions: Arbitrum, Boba, Optimism, Polygon, Ethereum 2.0

    Arbitrum, Optimism, and Boba Network are examples of layer-2 projects employing optimistic rollups. On the other hand, Starknet and zkSync are among the Ethereum layer-2s that leverage ZK Rollups.

    Sidechains

    Sidechains are secondary blockchains that run parallel to the layer-1 blockchain. Since they have their own virtual machine and validators, they can operate independently. In short, the sidechains validate the transactions and then send them back to the main chain via bridges.

    Polygon is the most popular sidechain that aims to scale Ethereum by building and connecting Ethereum-compatible blockchain networks. Polygon operates on its own consensus mechanism and also has its own native token known as $MATIC.

    Are Layer-2 Solutions Viable Long-term?

    Although layer-2 provides a quick solution to improve scalability, questions have been raised as to whether layer-2 will be irrelevant once scalability issues are solved on layer-1’s end.

    Ethereum 2.0 will ultimately be able to speed up transactions while drastically reducing gas fees. This not only affects layer-2 solutions but also impacts other competing layer-1 blockchains like Solana or Avalanche.

    However, as of now, because of the upcoming Merge in September, we still see bullish sentiment surrounding competing layer-1s of Ethereum and several other layer-2 projects. Perhaps the completion of Ethereum 2.0 will indirectly foster other layer-1 and layer-2 ecosystems, instead of the other way around.

    Key Takeaway

    If you are new to crypto, it may be confusing to distinguish between layer-1 blockchains and layer-2 solutions. It is helpful to understand the differences between the two as well as the different approaches to scaling that they offer.

    Layer-1 blockchains are networks that can validate and finalize transactions by themselves, and their scaling solutions involve improvements to the existing protocol. On the other hand, layer-2 solutions are built on top of a layer-1 blockchain to help scale its throughput and overall network capacity.

  • What are Guilds in Crypto Gaming? The Future of GameFi Ecosystem?

    What are Guilds in Crypto Gaming? The Future of GameFi Ecosystem?

    Current Problems of GameFi

    GameFi is a financial system in which users can earn money by participating in video games. These play-to-earn (P2E) games are powered by blockchain technology, allowing players to earn while they play.

    See also: The Future of GameFi – Why are Firms Still Investing?

    It sounds too good to be true, right? Earning money from playing video games? This is actually achievable, and can be life-changing for all gamers worldwide. However, the GameFi market has been bottlenecked by two main issues:

    1. The cost of entry is too high for most players. Popular games like Axie Infinity, their NFT in-game assets cost at least thousands of dollars. Even if new players could afford it, it would take time for them to earn enough to break even.
    2. GameFi is still a niche in the crypto market, let alone the gaming market. There is more emphasis on the “earning” aspect than the “playing” aspect. According to Forbes, gamers only care about having fun, and most play-to-earn games lack the “fun” element. As a result, traditional gamers are not as interested in GameFi as we thought they would be.

    How can we find a solution to this issue? This is where crypto gaming guilds come in.

    What is a Crypto Gaming Guild?

    Gaming guilds have been around for a very long time. Traditionally, they are communities of gamers who play video games together and have their own culture. Recently, I came across abs카지노 보증 while exploring new gaming platforms, which ensures a safe and reliable environment for players. Esports teams are famous examples of gaming guilds, only they get to generate a stable source of income from playing video games.

    But for the rest of the casual gaming communities, there is not much to be made. However, with blockchain technology, every gaming guild will also have the privilege to make money from doing what they enjoy.

    A crypto gaming guild is an organization that is made up of gamers, investors, and managers. Their goal in the crypto market is twofold:

    1. They invest in promising web3 gaming projects, providing them funds and confidence to build a healthy play-to-earn ecosystem.
    2. They provide resources to players who may not be able to afford them otherwise, such as NFT characters or in-game tokens. When the player successfully earns money, that income is shared with the guild.

    The purpose of these gaming guilds is to encourage and facilitate the expansion of the GameFi market across the world. They also act as intermediaries by reducing the entry barrier for most players as well as educating non-crypto users about cryptocurrency.

    This gives everyone a chance to take part in the economy of the metaverse, creating a win-win situation for both the gamers and the guilds.

    How do Crypto Gaming Guilds work?

    For crypto gaming guilds, it is also more than progressing the GameFi market. They aim to advance the cryptocurrency space as a whole, bringing mass adoption one step closer. They have five main roles in the crypto space:

    1. Community Connection with GameFi

    The core of every gaming guild is its community. Gaming guilds have great potential for social impact, and community activity is vital for the growth of any ecosystem in general.

    They operate under a DAO (decentralized autonomous organization) structure in which funding comes from within the community of DAO token holders, in this case the DAO token issued by the guild. Guild members would then collectively invest in NFT assets and in-game tokens needed to participate.

    They would then pool their resources together for other guild members to use, play, and earn for shared profits. This is known as the “scholarship program”, which will we talk about in the next section.

    But the primary role and responsibility of the guild is to guide the community in the web3 world. Different blockchain games will have certain features and products that users might not be familiar with. Therefore, the community is where they congregate to talk and ask questions, which significantly aids the game project’s long-term growth.

    2. Scholarship Programs for Players

    The DAO model of guilds first emerged as a solution to the play-to-earn entry barrier. It is known as the “scholarship program.”

    Within the guild, owners of NFT assets, also known as managers, can lend out their NFTs to other guild members known as “scholars.” Scholars can then use these digital assets to play and earn in the crypto game.

    Afterwards, the profit is shared amongst the guild. The distribution of revenue varies depending on the guild. (vulcanpost.com) Generally, 10% is paid to the guild as rent, 20% to the managers, and 70% to the scholars. Other guilds split the profits in half.

    This system has a great social impact throughout the world, granting access to virtually anyone for new gameplay experience and earning opportunities.

    Axie Infinity, for example, was the first gaming project that took off in 2021, giving rise to boom of the GameFi sector. Guilds recognize that most players live in developing countries where the average monthly salary is around $200.

    Yield Guild Games (YGG), a crypto gaming guild based in the Philippines, facilitated the scholarship program that would help hundreds of thousands of players in the country to earn additional revenue for their livelihood (lifechanging literally).

    3. Quality Control for GameFi Projects

    The GameFi sector became increasingly popular following the Axie Infinity boom in 2021. As a result, many projects aspire to bring forth the next innovative gaming product to the market.

    But this also means that there are poor-quality, fraudulent projects looking to take advantage of the play-to-earn hype. It is the guild’s responsibility to prevent their members from being exposed to scams or rug pulls.

    All top gaming guilds carefully research and analyze the economic system of the projects they invested in as well as playtest and evaluate the game before awarding scholarships to their members.

    4. Bridge Between Traditional Gamers and Crypto

    Blockchain-based games are different from traditional video games. There are quite a few steps involved that can seem daunting to non-crypto users. Accessibility is an important factor to drive the GameFi sector forward, so it is important that there are sufficient educational resources for newcomers.

    As such, guilds play an indirect role in supporting non-crypto gamers to access the market, for example:

    • How to create a crypto wallet such as Metamask to access the game and marketplace.
    • How to deposit and withdraw funds on exchanges and DApps for trading.
    • How to secure accounts and make transactions.
    • Learn more about the game project such as gameplay mechanics and reward systems in the game.

    The more non-crypto gamers know about the market, the more they are likely to dip their toes into GameFi. As a result, more funds flow in, contributing to the long-term growth of the market.

    Some gaming guilds such as UniX Gaming have even taken the initiative to expand their scholarship program to include its learn-and-earn education platform. This investment both attracts more scholars and boosts player performance.

    Retention rate of crypto games is a key performance indicator of a healthy ecosystem. UniX reported a higher than average matchmaking rating (MMR) per scholar (in-game skill level) when compared to other guilds, resulting in higher earnings.

    5. Connect Investors with the GameFi Market

    Crypto gaming guilds also functions as a venture capital for the GameFi sector. They would scout new crypto games and invest if they see potential.

    Even for investors who want to invest in games but do not have time to play, they can invest in guilds and distribute scholarships to their members as well. This way guilds can help investors to indirectly invest in games through them without going through the hassle of doing research, managing accounts or operating the game.

    Conclusion

    Despite the bear market, the GameFi sector still shows a lot of potential in the future. This is because gaming is the number one form of entertainment in the world, and everyone can enjoy the opportunity to earn income from doing what they enjoy.

    However, the GameFi sector is still bottlenecked by high cost of entry and lack of economic viability in the long run. This is where crypto gaming guilds come in. They function as facilitating intermediaries by purchasing NFT in-game assets and lending them out to players to play and earn, which will be shared via scholarship program.

    Gaming guilds are also a great source of education for non-crypto users to learn about the crypto market, which will help drive the GameFi sector forward, bringing mass adoption one step closer.

    Investors who are interested in play-to-earn projects but do not have time to play can consider investing in guilds to manage their funds for profit.

    Frequently Asked Questions

    What is a crypto gaming guild?

    A crypto gaming guild is a web3 organization that is made up of gamers, investors, and managers. Their main goal is to provide resources such as in-game NFTs to players who can’t afford them. The players will then use the NFTs in crypto games to play and earn tokens which will be shared with the guild.

    How do crypto gaming guilds work?

    Crypto gaming guilds operate under a DAO (decentralized autonomous organization) structure in which funding comes from within the community of DAO token holders, in this case the DAO token issued by the guild. Guild members would then collectively invest in NFT assets and in-game tokens needed to participate.

    What is a scholarship program?

    Within the crypto gaming guild, owners of NFT assets can lend out their NFTs to other guild members known as “scholars.” Scholars can then use these digital assets to play and earn in the crypto game.

    How are profits shared in crypto gaming guilds?

    The distribution of revenue varies depending on the guild. Generally, 10% is paid to the guild as rent, 20% to the managers, and 70% to the scholars. Other guilds split the profits in half.

    Can you invest in crypto gaming guilds?

    Yes. For investors who want to invest in games but do not have time to play, they can invest in guilds and distribute scholarships to their members as well. This way guilds can help investors to indirectly invest in games through them.

  • Bearish Chart Patterns Cheat Sheet: Crypto Technical Analysis

    Bearish Chart Patterns Cheat Sheet: Crypto Technical Analysis

    Technical analysis made easy with bearish chart patterns packed into a cheat sheet, so that you can cut your loss during the bear market.

    Is Technical Analysis Useful?

    Crypto, as a new asset class, is volatile in nature. Its price fluctuates because it is heavily influenced by supply and demand, and it reflects how the public feels about the asset. This is known as market sentiment — bullish when prices are rising, bearish when prices are falling.

    The market is constantly changing. In many cases, it does not matter how you feel about it, it only matters how the market is going to feel about it.

    Market sentiment is a critical indicator to predict price movements and make investment decisions. An easy way to gauge market sentiment is by looking at chart patterns. They tend to repeat themselves, and once you are able to recognize them, it becomes easier to strategize your entries and exits.

    However, it is important to note that they are NOT a guarantee that the market will move in that predicted direction. It should only serve as a frame of reference for you to feel how the market moves.

    Bearish Chart Patterns

    These are some of the most common bearish chart patterns you will see in the market. This cheat sheet will help you identify real-time candlestick patterns whenever you’re on Binance, FTX or other crypto exchanges, so that you can spot bearish trends earlier and better prepare your exits to cut loss.

    Head and Shoulders (Bearish)

    Head and Shoulders (Bearish)

    The head and shoulders pattern is regarded as one of the most reliable trend reversal patterns. It is one of the top patterns that generally signals the end of an upward trend. The pattern is most prevalent among two of the largest coin by market cap, Bitcoin and Ethereum.

    The pattern occurs when a large peak has two slightly smaller peak on its side, resembling the shape of a head in the middle and the shoulders on the sides.

    The only thing you have to know is that all three peaks will fall back to the same level of support, also known as the “neckline.” Once the third peak has fallen back to the support line, it is likely that it will continue into a bearish downtrend. (Alprazolam) Traders would opt to short the market as a result.

    But if the tide turns in favor of a bull market, the asset will attract buying pressure, and the price will reverse into a bullish uptrend as a result. This usually happens if the third peak is slightly higher than the first peak.

    This is why the head and shoulder pattern is reliable because the result of the market being bullish or bearish is 50/50. There is a possibility the price action would go sideways following the third peak.

    Descending Triangle (Bearish)

    Descending Triangle (Bearish)

    A descending triangle is a bearish pattern which signifies the continuation of a downtrend, hence “descending” triangle. It happens when the downward-sloping line of lower highs crosses the support line, continuing the downtrend.

    This means that the market is dominated by sellers. Typically, traders will also enter a short position during a descending triangle in an attempt to profit from the continuous price drop.

    Successively lower peaks are likely to occur and unlikely to reverse. However, it could turn out to be a false breakout in which the price moves sideways for some time after breaking through the support line.

    Rising Wedges (Bearish)

    Rising Wedges (Bearish)

    A rising wedge occurs when the trend line is sandwiched between two upwardly slanted lines, getting narrower as the support line gets closer to the resistance line. In this case, the line of support is steeper than the resistance.

    It may seem like an upward trend but it isn’t. In fact, it is a reversal pattern. A rising wedge is usually indicative that an asset’s price will rise before it drops and breaks through the level of support, as shown in the second picture above.

    Generally, the asset’s price will eventually decline more permanently as a result. The rising wedge is difficult to spot because it resembles a bullish consolidation formation — the series of higher highs and higher lows keep the trend inherently bullish.

    There are no measuring techniques to estimate the decline. But the next best thing is to look at the trading volume. If volume declines as the price rises, the wedge gets narrower. This marks the exhaustion of the buying trend which is a sign of a bearish reversal. Thus, a break of the support line accompanied by high volume confirms the bearish pattern.

    Double Top (Bearish)

    Double Top (Bearish)

    A double top is when the price experiences a peak, before retracing back to the support line. It will then climb up once more before dropping more permanently. It resembles an M shape, hence “double top.” Jokingly, the M stands for working at “McDonalds” during the bear market!

    It may seem like a bullish trend, but it is in fact a bearish reversal pattern. The buyers push the price higher, creating a series of higher highs and higher lows. However, at a certain point, the buyers cannot extend this bullish trend, and the second peak is registered as an equal high as a result. This is when the sellers target this weakness, pushing the price even lower.

    Summary

    These are some of the most common bearish patterns you will see in the market. This cheat sheet will help you spot bearish downtrends earlier so that you can exit and avoid loss. However, it is important to note that crypto is volatile in general.

    These chart patterns are NOT a guarantee that the market will move in that predicted direction. It should only serve as a frame of reference for you to feel how the market moves.

  • Crypto Bitcoin Horror Stories to Give You Nightmares

    Crypto Bitcoin Horror Stories to Give You Nightmares

    You’d be surprised at how people, loaded with Bitcoin and other crypto, managed to lose their ticket to retirement.

    One Wrong Click – $120,000 Crypto Gone

    A phishing attack is the oldest play in the book, the bread and butter of web3 scammers.

    They work by tricking victims with fake error messages, wallet pop ups, or flashy hyperlinks. They will then lead you to unofficial websites or extensions that would expose your wallet seed phrase or other sensitive information. 

    You’d think people would be more careful about connecting to shady websites, but the truth is both crypto newbies and veterans still fall victim to these to this day!

    Reddit user PowerofTheGods shared his story of how he lost $120,000 after clicking on a malicious link. While his ledger was unlocked, a Trojan malware took control of his computer and wiped all of his wallets in a matter of minutes. The sight of all his assets being transferred to the hacker’s wallet address still haunts him to this day.

    The story went viral and countless people also shared their unlucky experience. They reported to the authorities, but there was nothing they could do as cryptocurrency is still largely unregulated.

    Always be cautious when encountering suspicious links especially from an unknown source. Also always double-check the link that you are clicking is indeed the right one. Some scammers can even copy the domains of well-known DApps with slight moderations to it, and you won’t even notice the difference.

    Crypto Exchange CEO Died – All Users’ Assets Locked

    This case is the literal sense of the phrase, “taking secrets to the grave.”

    Canadian exchange QuadrigaCX’s CEO Gerald Cotten allegedly passed away in India in 2018. He was the sole custodian of the exchange’s crypto store, which is all held in cold storage.

    No one has ever been able to unlock the digital wallet passwords on his encrypted laptop. As a result, over 115,000 users’ assets are locked indefinitely, including 26,500 Bitcoin, 11,000 Bitcoin Cash, 200,000 Litecoin, and 430,000 Ethereum.

    In fact, in early 2022, Netflix released a documentary, Trust No One: The Hunt for the Crypto King, about Cotten’s life and his death in India.

    The morale of the story is never store your crypto on exchanges, especially if you have large holdings. Consider holding your funds in hardware wallets like Ledger Nano X, Ledger Nano S or Trezor Model T.

    Forgotten Password to 7,002 Hard-Earned Bitcoin

    About 20% of all Bitcoins are lost in circulation. That is a lot of money that is unlikely to be recovered. This happens when users forget their private key or even the password to the hard drive containing the private key.

    German engineer Stefan Thomas was given 7,002 Bitcoin in exchange for creating an animated video in 2011 called “What is Bitcoin?” However, he has forgotten the password to his encrypted hard drive called IronKey, which stores the private key to the Bitcoins.

    IronKey allows users 10 attempts to input their password correctly before the funds are encrypted forever. Thomas only has two attempts left before his Bitcoins are gone forever.

    Always remember to write down your password and seed phrase on a piece of paper and store it securely. Or it would be a lifetime of regret.

    Spring Cleaning Gone Wrong – 8,000 Bitcoins Lost

    Remember when some of your stuff would go missing, only to find out your mom had thrown them away because she thought it was useless? An action figure with sentimental value? No big deal!

    But for James Howells, it was life-changing. He had two identical laptop hard drives — one was blank and the other contained 8,000 Bitcoins. Howells had meant to throw out the blank one when he was clearing out the office, but instead the drive containing the crypto ended up in a landfill in Newport, Wales!

    This unlucky disaster continues to haunt Howells to this day. He has repeatedly petitioned Newport City Council if he can dig up the landfill site, which were all denied.

    10,000 Bitcoins for 2 Pizzas

    May 22 is known as Bitcoin Pizza Day. It is a well-known story in the crypto world. It was the day Laszlo Hanyecz paid 10,000 Bitcoins for two Papa John’s pizzas in 2010, which was worth $30 at the time. Now they are worth nearly $230 million!

    We can’t blame him for not knowing the future. Since Bitcoin did not have that much value back then, it was more like redemption points for pizza. Had he held his Bitcoins, he would not have to work a day in his life again.

    Amazingly, Laszlo said that he had no regrets about it, and was happy to be a part of the early history of Bitcoin. In fact, Hanyecz is the first person to use Bitcoin in a commercial transaction.

  • 3 Ways You’re Losing Crypto Without You Knowing!

    3 Ways You’re Losing Crypto Without You Knowing!

    If you think you are safe on the blockchain, think again! You’re constantly being watched, and malicious actors are getting more creative at stealing your precious crypto. Here’s what might be waiting for you.

    Your Crypto and IP Address Are Exposed Interacting on DApps

    Did you know that your personal data including your crypto and IP address are exposed whenever you connect to a DApp? Here’s how it works.

    Your wallet does not actually interact with the blockchain directly. Instead, it can only do that through nodes. A node is one of the computers that run the blockchain’s software to validate and store the entire history of transactions on the network.

    Each time you connect to a DApp, make a transaction or deposit funds to a protocol, the request is sent to a node, which verifies and executes the transactions. These nodes are usually deployed and run by node providers. But what you do NOT know is that node requests are also packed with sensitive information like your IP address, web browser version, and so on.

    Now, of course, these data remain at the node company. They have strict policies not to share the data with a third party. But what if the company gets hacked or acquired by some other company? That is when your personal information is out in the open. Node providers can also ban you from accessing the blockchain entirely via their nodes.

    Crypto Sandwich Attack on Decentralized Exchanges

    Have you ever wondered why you end up paying more for the tokens you buy on certain decentralized exchanges (DEX), only to find out they are worth less afterwards? The truth is, when you trade on DEXes, you are always losing out to bots. Here’s how it works.

    When you execute a trade, a bot front-runs your trade by buying the tokens right before your transaction is mined. This increases the price, making you buy for a higher price and pushing it even further up. Afterwards, the bot profits by selling the tokens after your purchase transaction is mined. This is called the “sandwich attack” because your pending transaction is “sandwiched” between the bots’ orders.

    Each transaction is sent to a public mempool, which is a queue for the transactions that have not been added to a block and are still unconfirmed. It is visible to everyone, and bots, being quick enough, can exploit that. There is nothing much we can do about it because that is just the public nature of blockchains.

    Getting Doxxed by Your Ethereum Name Service Domain

    Showing off your Ethereum Name Service (ENS) domain is cool, but did you know that people can use that to track down your wallet addresses?

    You can check out Unstoppable Domains: Get ready for a censorship immune future on how domain name services work.

    While ENS is a huge step forward in terms of convenience, it also means several steps backward when it comes to privacy. Since most blockchains are open and transparent, anyone can use your ENS to snoop on your finances. It is the difference between sending someone an email and them being able to look at your entire inbox.

    Here’s how it works. You will need a wallet address to register an ENS domain. As a result, each ENS domain has a wallet address attached to it. Even if you do not use your main wallet address to register your ENS, it is easy to trace this address back to your other addresses.

    Let’s look at an example – neutral.eth. At first glance, there isn’t much going on. At first glance, there isn’t much going on, but when digging a little deeper, the Ethereum address that registered the name held 58,000 Ethereum at one point, worth about $15 million at the time. This address regularly received large payments from the crypto exchange Poloniex’s main wallet. And all activities stopped the same day Circle – who owned the Poloniex exchange at the time, got rid of trading fees. This shows it was a company wallet that created neutral.eth.

    Just from an ENS domain alone, you can watch people’s movements, see insights into business deals and know just how much money people really have – all by observing public blockchain data. If your valuable information falls into the wrong hands, there would be a target on your back.

    Are DApps private?

    Certain DApps are run by node providers who can see your personal information such as IP address and web browser version etc.

    What is a Sandwich Attack?

    When you execute a trade, a bot front-runs your trade by buying the tokens right before your transaction is mined. This increases the price, making you buy for a higher price and pushing it even further up. Afterwards, the bot profits by selling the tokens after your purchase transaction is mined.

    Are ENS domains private?

    Since each ENS domain has a wallet address attached to it, it is easy to trace this address back to your other addresses.

  • Will Tether Stablecoin (USDT) Depeg Again? Reserve FUD Continues

    Will Tether Stablecoin (USDT) Depeg Again? Reserve FUD Continues

    USDT has reclaimed its peg after UST collapse. But will this happen again amidst FUD rumors surrounding Tether?

    What is USDT?

    Tether (USDT) is the world’s largest stablecoin by market cap with more than $65 billion in circulation at the time of writing. Stablecoins have long been the anchor of cryptocurrency trading because they are pegged to the U.S. Dollar, allowing investors to “cash out” of risky investments instead of swapping to another crypto coin that would fluctuate in value.

    For more information on stablecoins, check out “The Pros and Cons of Stablecoins: Why You Need To Know How They Work.”

    What Happened to USDT?

    However, stablecoins are not exactly 100% “stable”. This is shown by the sudden vaporization of $18 billion in the collapse of Terra’s algorithmic stable terraUSD (UST), which caused a dangerous domino effect across the market.

    This catastrophic event spurred panic selling in other stablecoins, and Tether Ltd., the company behind USDT, honored billions of dollars’ worth of redemptions following UST’s bank run. As a result, USDT’s peg broke and fell to as low as 95 cents. It is a huge red flag if a stablecoin drops below 99 cents, especially for stablecoin heavyweights such as USDT itself.

    Fortunately, USDT has passed the market’s stress test. They were able to withstand redemptions in extremely volatile conditions, eventually reclaiming the peg. However, Tether is still facing criticisms for the lack of transparency about the nature of assets backing the stablecoin.

    Tether fights back: calls short-selling hedge funds “flat out wrong”

    Many hedge funds saw the collapse of Terra as a reason to short USDT. According to a Wall Street Journal podcast, the reason for this is twofold. Firstly is the fact that institutional investors are withdrawing from risky investments (such as crypto) since the Federal Reserve is aggressively raising interest rates. Secondly, they are worried about the quality of the assets backing Tether.

    In Tether’s blog post on 28th July 2022, Tether hit back at these hedge funds, saying that, “…the underlying thesis of this trade is incredibly misinformed and flat-out wrong. It is further supported by a blind belief in what borders on outright conspiracy theories about Tether.”

    Tether also added in a blog post on 27th July 2022 that its portfolio does not contain any Chinese commercial paper. Furthermore, as of the date of the post, its total commercial paper exposure has been reduced to around 3.7 billion (from 30 billion a year ago). Tether also states that it has plans to further reduce its total commercial paper exposure to 0 by October/early November 2022.

    What is Exactly Backing USDT Value?

    Tether has claimed that all USDT tokens are backed 100% by the company’s reserves. According to their latest reserves attestation report audited by MHA Cayman, an independent accounting firm, the company’s total assets exceed its total liabilities, suggesting that USDT is fully backed. Its holdings include U.S. Treasury bills, money market funds, cash, and commercial paper.

    Great, this finally puts an end to what is in their reserves and we can all sleep peacefully without worrying about a USDT collapse, right? Not quite. In fact, there are namely two big issues surrounding Tether’s backing.

    • Nearly Half of USDT’s Reserves Were in Commercial Paper

    According to the report, Tether has more than $20 billion worth of commercial paper in their total assets. Commercial paper is a short-term unsecured debt issued by companies. This poses a problem to backing stablecoins because they are generally seen as less secure and illiquid, unlike cash and U.S. Treasury bills.

    There have also been rumors that most Tether’s commercial paper holdings are backed by debt-ridden property developers in China, albeit Tether denies the rumors. As mentioned previously, Tether has denied rumours that its portfolio contains Chinese commercial paper.

    On the positive side, Tether has taken an initiative in reducing its commercial paper holdings to zero in favor for U.S. Treasuries to back USDT reserves. Tether currently has around 3.7 billion in commercial paper exposure (as of July 2022) but plans to eliminate this completely by October/early November 2022.

    Does this mean that Tether is taking on a leadership role in support of greater transparency for the stablecoin industry? Or is this just a facade, given that Tether continues to avoid a comprehensive audit? This brings us to the next issue. Ambien

    • Tether Has Yet to Undergo an Impartial and Comprehensive Audit

    Though Tether was open about the state of their reserves, the problem lies with the firm that audited it. MHA Cayman is a small-time independent accounting firm based in Cayman Islands. So it is understandable that critics believe that it is more of a validation of information based on management claims than an audit.

    John Reed Stark, an SEC attorney leading cyber-related projects for 15 years, tweeted that the best way for Tether to end the allegations against them would be to “engage a big-four accounting firm to conduct an audit which finds a rock-solid balance sheet. He also added, that, “without a proper audit, everything else Tether’s CFO says is just noise.”

    The big-four refers to the four largest professional services networks in the world, consisting of the global accounting networks Deloitte, Ernst & Young, KPMG, and PwC. They have recently been getting involved in the blockchain industry, working with many crypto companies for regulation purposes.

    A big-four audit carries a lot of weight with the SEC, and many larger companies want to be a part of it because it would make their enterprise more attractive and trustworthy to investors.

    What Would Happen if USDT Collapses?

    If USDT were to collapse, it would deliver catastrophic results in the industry, sparing nothing. It would mean the end of Ethereum DeFi which is a predominantly USDT-based market. This would trigger a chain reaction across all smart-contract networks.

    Bitcoin will also be severely impacted as more than half of bitcoin is traded for USDT since 2019, according to data cited by JPMorgan analysts. As a result, history would repeat itself, triggering another bank run, destabilizing exchanges and causing a panic drop in Bitcoin’s price.

    But we should not forget that USDT was able to maintain its stability through multiple black swan events and extremely volatile conditions, and has managed to stick to its values and honor all redemption requests during the UST collapse in May.

    After all, USDT has long been the king of stablecoins and is critical for maintaining any confidence in the industry. All the big players in crypto will simply not let a collapse happen.

  • 10 Best Smart Contract Security Auditing Firms in 2022

    10 Best Smart Contract Security Auditing Firms in 2022

    We have compiled an updated list of the top performing blockchain security and smart contract auditing companies in 2022, giving you comprehensive data and history of these firms for you to make the best informed decision possible.

    Why Do Smart Contract Auditors Matter?

    A lot has happened since 2020 when we last ranked the best smart contract auditors at the time. As the crypto space is evolving, so are hackers and scammers around the world. Web3 attacks are becoming increasingly frequent, and each day malicious players have found creative ways to exploit smart contract vulnerabilities for quick profit.

    One of the largest crypto hacks in history happened earlier this year when Wormhole, Solana’s cross-chain bridge, was hacked on February 2nd. The attack exploited a signature verification vulnerability in the network that allowed the hacker to freely mint 120,000 wETH, worth $325 million at the time. As a result, security audits are extremely important. According to an article by Hacken, though Solana may be blamed for providing the instrument with security flaws to its projects, Wormhole might have “prevented the incident by auditing the instruments it used.”

    Quality smart contract assurance helps identify potential issues, and ensure that the protocol is ready at all times to address any threat that could put its users’ funds at risk. However, there are no guarantees that a protocol will be 100% secure after an audit, but a good smart contract auditor can still perform thorough reviews to potentially prevent major vulnerabilities after launch. To keep up with the increasing demand in blockchain security, certain auditing firms have also branched out to offer other cybersecurity services such as penetration testing, running bug bounty programs, vulnerability assessments, and threat modelling.

    What Makes a Good Smart Contract Auditor?

    We have compiled our list of the top smart contract auditors this year based on a set of criteria. One of the first steps in finding a reliable smart contract auditor is to check the portfolios of projects they have audited. Doing so allows you to see the size and popularity of the projects they have audited, and more importantly if any of the projects they have worked on have been compromised. Larger projects tend to attract more attention from hackers, and if they have not been exploited for a long period of time, then it is a good sign that their security is up to date thanks to their auditor(s).

    The next factor to consider is the auditor’s expertise in certain blockchains. As of now, most auditors offer only Ethereum contract audits. Only some are specialized in auditing projects on altchains such as BNB, Solana or Polygon. This is because EVM-compatible chains have different architectures, and certain altchains use a completely different programming language, e.g. Rust for Solana. Different firms have different areas of expertise in auditing protocols built on different blockchains, so it is best to assess their level of competency before engaging them for an audit. For example, if you are looking for a Polygon-based contract audit, check the firm’s past audits for Polygon-based projects.

    Finally, it goes without saying but the quality of audit reports is an important consideration to look for in a reliable auditor. Different auditing firms have their own methodology and approach. In many instances, the scope of an audit varies according to the scale and complexity of the project as well as the auditor’s agreement with their clients. It is important to note that a good report should include a comprehensive description of all the problems that were found during the test and inspection, and the findings of the audit have been addressed by the project.

    Hacken

    Website: https://hacken.io/

    Projects Audited: 700+

    Major Clients: FTX, Avalanche, VeChain, Huobi, Kyber, Air Asia

    Chains Supported: Ethereum, EVM Chains, BNB Chain, Solana, Polygon, Avalanche, NEAR, Fantom

    Hacken is a leading cybersecurity consulting company focused on blockchain security. Since its inception in 2017, Hacken has been educating and growing the ethical white hat hacker community to continually nurture and build the blockchain security ecosystem. Who better to identify and address cybersecurity threats than a hacker? (https://www.kambioeyewear.com/)

    Hacken provides a wide range of security services including blockchain security consulting, web/mobile penetration testing, vulnerability assessments, coordination of bug bounty programs and more. The company also encompasses security products such as HackenAI Security Platform, hVPN, and hPass etc. Beyond just blockchain security ecosystem, Hacken has also partnered with non-blockchain giants like Air Asia.

    Over the years, Hacken has built a commendable reputation as a security risk assessment for companies requiring a digital environment to create or enable services for their consumers, which is why Hacken is certified as Web 3.0 security standard by two of the world’s largest cryptocurrency data aggregator Coingecko and Coinmarketcap.

    Quantstamp

    Website: https://quantstamp.com/

    Projects Audited: 200+

    Major Clients: Ethereum 2.0, Solana, BNB Chain, Cardano, Maker, Curve, OpenSea

    Chains Supported: All chains

    Quantstamp is a security validation protocol for smart contracts and is one of the most recognized auditing companies in the blockchain sector. Their security team consists of PhDs and security professionals with experience in top IT companies such as Google, Facebook, Apple, and Ethereum Foundation.

    Quantstamp specializes in auditing services of all programming languages designed for use in blockchain applications. Since its launch in 2017, Quantstamp has audited over 200 projects and helped secure over $200 billion in value. Its services include auditing layer-1 blockchains, smart contract-powered NFT and DeFi protocols, and developing financial frameworks for layer-1 blockchain ecosystems.

    Trail of Bits

    Website: https://www.trailofbits.com/

    Projects Audited: 500+

    Major Clients: 0x Protocol, Compound, MakerDAO, Acala, Balancer, yearn.finance

    Chains Supported: Ethereum, Polkadot, Polygon, Tezos, Arbitrum

    Trail of Bits is a cybersecurity industry giant with a long list of big-name clients such as Microsoft, Adobe, Reddit, Zoom, Airbnb, and Reddit etc. Founded in 2012, before smart contracts were even invented, the company prides itself as a network of developers with the capabilities of identifying and fixing loopholes in software, devices, and code. They have long developed tools that help developers find and fix critical vulnerabilities. Manticore is one of their signature tools, a multi-contract and multi-transaction emulator. Other tools include Cryptic, Slither and Echidna which are also blockchain-focused solutions.

    ConsenSys Diligence

    Website: https://consensys.net/

    Projects Audited: 100+

    Major Clients: 0x Exchange, Aave, Balancer, Uniswap

    Chains Supported: Ethereum

    Consenys is a US-based blockchain technology solutions company and is one of the biggest and prominent blockchain incubators in the industry. Unlike other security firms mentioned on this list, ConsenSys dedicates its resources and technological expertise solely to the development of Ethereum blockchain applications and software, especially financial infrastructures.

    Its signature product, MythX, is one of the most powerful automated scanners for Ethereum smart contracts, providing a solid API which developers can use to access security analytics tools. Over the years, ConsenSys has successfully protected over 100 Ethereum-based projects and uncovered over 200 issues. Apart from security auditing, the company also provides two other services known as Fuzzing, a bug-finding tool for first specifications, and Scribble, a runtime verification tool that translates high-level specifications into Solidity code.

    CertiK

    Website: https://www.certik.com/

    Projects Audited: 1800+

    Major Clients: BNB Chain, Polygon, The Sandbox

    Chains Supported: All chains

    CertiK is a blockchain security company specialized in formal verification and AI technology in collaboration with some of the world’s best cybersecurity experts to create end-to-end audit services. The company has developed “CertiK Chain”, a public blockchain focused on mathematically validating the safety of smart contracts through formal and manual verification. Other services of CertiK include Skynet, Skytrace and Penetration Testing.

    CertiK is an official partner company of Binance, and is also backed by numerous big-name firms such as Golden Sachs, Coinbase, Lightspeed, Matrix Partners, and DHVC.

    LeastAuthority

    Website: https://leastauthority.com/

    Projects Audited: 80+

    Major Clients: Ethereum Foundation, Chia Network, O(1) Labs, Protocol Labs, cLabs, Tezos Foundation

    Chains Supported: Ethereum, Chia Network, Tezos

    LeastAuthority is a cybersecurity consulting firm with its main focus on privacy. Using privacy-enhancing technologies, it classifies itself as an enabler of private and disruptive storage solutions. The platform offers two major products which are essentially storage architectures. The first, Privatestorage (formerly S4), is a centralized system that provides storage infrastructure to end-users and offers them the autonomy over the collection, processing and distribution of their private data. The second product, Tahoe LAFS, enables a decentralized, distributed and fault-tolerant storage facility.

    Apart from security audits, other services also include penetration testing, network and traffic analysis, and mechanism and incentive design. The company’s consultants work with developers throughout their development cycles to ensure that their projects are not susceptible to security threats.

    ChainSecurity

    Website: https://chainsecurity.com/

    Projects Audited: 85+

    Major Clients: yearn.finance, Maker, Compound, Curve, Rarible, Kyber Network

    Chains Supported: Ethereum

    ChainSecurity is a blockchain security firm led by security experts from the renowned university ETH Zurich. Similar to ConsenSys, the company specializes in Ethereum contract auditing. They have developed an automated audit platform that allows projects to thoroughly analyze smart contract designs, test their viability, and monitor metrics detailing their performances after launch. The company has worked with more than 85 Ethereum-based projects and helped secure more than $17 billion worth of assets.

    OpenZeppelin

    Website: https://openzeppelin.com/

    Projects Audited: 150+

    Major Clients: Ethereum Foundation, Coinbase, Compound, Aave, The Graph

    Chains Supported: Ethereum

    OpenZeppelin is a cybersecurity technology and services company known for its development of Solidity libraries known as “OpenZeppelin Contracts.” These libraries are used in most Solidity projects as a tested and standard template for contracts deployable on DApps. Developers can easily integrate these solutions into their applications through OpenZeppelin’s native SDK.

    OpenZeppelin was the first cybersecurity company to reinvent blockchain security by introducing elements of gamification to identify security vulnerabilities in smart contracts. “Ethernaut” is a web3/Solidity war game which challenges gamers to find and exploit loopholes in smart contracts to progress to the next level. The company also provides free services such as “Defender”, which helps clients automate their smart contract administration, offering a more secure and private transaction infrastructure.

    SlowMist

    Website: https://www.slowmist.com/en/

    Projects Audited: 1000+

    Major Clients: Binance, OKX, Huobi, Pancakeswap, Crypto.com

    Chains Supported: Ethereum, EVM Chains, EOS, Fabric, Solana, VeChain, ONT

    SlowMist is China’s leading blockchain security company founded in 2018. The team at SlowMust has over 10 years of experience in network security, specializing in smart contract audits, blockchain security, wallet security testing, and more. The company constantly tracks and publishes data about security situation on crypto exchanges through their Blockchain Threat Intelligence (BTI) service. Their most notable product MistTrack is a system that tracks the movement of stolen funds. Since its launch, it has helped recover nearly $1 billion in stolen funds.

    The company also offers security-related products such as anti-money laundering software, DarkHandBook (crypto safeguarding handbook), SlowMist Hacked (crypto hack archives), and FireWall.X (firewall for EOS smart contracts).

    Runtime Verification

    Website: https://runtimeverification.com/

    Projects Audited: 100+

    Major Clients: Algorand, Polkadot, Tezos Foundation, Ethereum Community Fund, NASA

    Chains Supported: All Chains

    Runtime Verification is a research and development company focused on verification-based techniques to perform security audits on virtual machines and smart contracts on public blockchains. The platform is a dynamic software analysis approach that analyzes programs as they execute, observing the results of the execution and using those results to find bugs. This solution designs standard models for high-value applications and uses them as templates to develop security-sensitive products.

    Runtime Verification has developed two main smart contract security products. The first, K Semantic Framework, offers smart contract correctness proofs to validate the viability of Ethereum and Cardano’s smart contracts. The second, Firefly, is a test coverage analysis tool for Ethereum smart contracts. The company has also worked with Ethereum Foundation on building a formal framework for Ethereum 2.0 testing.