Chinese New Year (Lunar New Year) has a strong influence on cryptocurrency prices, with Bitcoin prices decreasing in the months leading up to the New Year. This article examines the trend and the possible reasons why it happens. Chinese New Year is celebrated on a different day each year as it is based on the Lunar Calendar.
This year, Chinese New Year will begin on 10 February and end on 13 February. During this time many Chinese Over-the-Counter (OTC) services will be closed – leading to high crypto volatility.
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*Data based on Bitcoin Prices on CoinGecko. Pre-CNY Highs taken as average candle price up to 7 days before the New Year.
This period is a public holiday in China, as many employees make the annual trip back to their hometowns to celebrate with their families. With a population of 1.386 billion, this represents the largest short-term migration in the world. During this time, I also came across some fascinating information about the best Plinko gambling sites, which offer unique and engaging gaming experiences for enthusiasts. All factories in China close during this period, with operations frozen for up to 2 weeks as logistics companies and suppliers slowly open up. Chinese New Year is also celebrated in other Asian countries such as Hong Kong, Singapore, and Korea (Korean New Year). China will also be rolling out a feature allowing people to send red packets containing its digital currency eCNY/DCEP. However, itâs important to note that during this time cryptocurrency exchanges will still operate and facilitate trading around the clock.
Chinese New Year Dump in 2019, 2020, 2021, 2022 and 2023?
Bitcoin prices would almost always drop in the weeks leading up to Chinese New Year.
For example, in 2019, Bitcoin prices dropped steadily from $3,491 right before the Chinese New Year to lows of $3,397 during the holiday.
In 2020, prices fell below the USD$8.3k resistance before Chinese New Year. There was a recovery back to USD$8.5k on the first day of the holidays. However, history cannot help but repeat itself, and within the same day plummeted back below USD$8.3k. Prices then remained stagnant and only made a marked recovery on the last day of the holidays.
In 2021, the tides seemed to have turned with a gradual increase from $32k to $39k in the first week of February, and a huge 2-day rally up to $48k in the few days leading up to the festival. However, during Chinese New Year, prices still began retracing to $46.2k. Fortunately, this did not wipe out the pre-Chinese New Year rally.
2021 Chinese New Year Bitcoin prices (Source: CoinGecko)
In 2022, prices took a sharp nosedive to sub USD$37 levels just before the holidays. Bitcoin prices then rose sharply towards a peak of over USD$39k midway through the Chinese New Year holidays. However, this euphoria was short-lived, and prices took a steep tumble to USD$36.5k on the last day of the Chinese New Year holidays. Essentially undoing the initial price rally a few days prior.
2022 Chinese New Year Bitcoin prices (Source: CoinGecko)
In 2023, prices pumped 1 day before the new year, ringing in a high of US$23,282.40 on the 1st day of Chinese New Year. Prices fluctuated between the US$22,500 and US$23,000 range during the duration of the holidays. However, ultimately closing at US$22,437.68.
Why do Bitcoin prices dump during Chinese New Year?
Decrease in Trading Volume?
Data compiled by CoinDesk Research shows the trading volumes on Binance, Huobi, and OKEx âthe most popular cryptocurrency exchanges catering to Chinese customers â were down during the Chinese New Year period. A decrease in trading volume can also be seen during October each year when Golden Week (a 1-week celebration for National Day) in China takes place.
When large numbers of highly leveraged traders all bet on Bitcoin prices moving one way it creates an opportunity for other large investors (whales) to move prices in the other direction. Doing so triggers a cascade of liquidations, sending Bitcoinâs price into free fall and creating huge paper losses for leveraged long traders. The whales are then free to “buy the dip” at the expense of ârektâ traders.
Market Makers on Holiday
It is no secret that market makers and trading bots operate in the Cryptocurrency market – in fact, they are responsible for a portion of the market volume. Market makers located in China and other Asian countries will shut down operations for 3-5 days due to public holidays. Even though market making can be automated by trading bots and algorithms, it still requires humans to watch over the daily operation to make sure the is no malfunction.
During the Chinese New Year, market-making operations will be limited in capacity. This leads to more volatile and less liquid markets.
Cashing out for the New Year
Giving Red Packets filled with cash is a tradition
One of the possible reasons for the dip in Bitcoin prices is that people are “Cashing out” for the holidays. This is especially true in China because, during the festival, lucky packets packed with cash are traditionally given out to children and the elderly. These “red packets” are meant to symbolise luck and prosperity and is the only time when giving cash is not taboo in China.
Tradition dictates that married couples should give out red packets to young unmarried children, elderly and service personnel. Company Executives and managers should also give money to their subordinates – with some packets being filled to as much as the employee’s monthly wage.
Due to the huge amount of cash money required, some suspect that this tradition is responsible for the increase in Bitcoin Sell orders before Chinese New Year.
Chinese OTC Volume Drops
Bitcoin is traded in China via Over the Counter (OTC) desks. These OTC desks match orders from buyers and sellers and can offer escrow services. Top desks include Binance OTC and Huobi OTC.
Chinese New Year 2024 Bitcoin price predictions?
This year, Chinese analysts are already looking into the future and are optimistic for Bitcoin prices in the month after the Chinese New Year. They note that Bitcoin prices have generally gone up in the month after Chinese New Year. For example, in 2023, Bitcoin prices went up by 11.15% in the month after the new year, 13.9% increase in 2022, and 30.18%(!!) increase in 2021.
Prices have already been on the rise since 23rd January 2024 where prices were a at a low of US$38,678.18. Prices have been skyrocketing since 7th February 2024, and have crossed the US$46,000 on 9th February 2024! This was already predicted by some analysts on Weibo, saying that prices will not dip, and to welcome the bull market during Chinese New Year.
Crypto analysts have found that Bitcoin prices would almost always drop in the weeks leading up to the Chinese New Year. Hence in the weeks before and during the “Chinese New Year Dump”, traders expect huge volatility in crypto prices.
Why is there a Chinese New Year Bitcoin dump?
Chinese New Year marks the longest extended holiday in China. This period marks the world’s largest short-term migration as people return to their hometowns to visit family. People also cash out to send money back to their families and gift children “red packets”. Therefore, crypto prices dump during Chinese New Year as there is lower trading volume when everyone has “cashed out” their crypto or is busy celebrating.
When is Chinese New Year in 2024?
This year, Chinese New Year will begin on 10 February and end on 13 February.
The Hinman documents are a collection of internal SEC messages concerning a speech given by former SEC Director William Hinman in 2018. These documents have been at the center of attention in the ongoing SEC v. Ripple lawsuit. In this article, we will explore the Hinman documents, their expected unsealing date, and their potential impact on the crypto market and XRP holders. We will also discuss why these documents are important for both the SEC v. Ripple case and the crypto industry as a whole.
Table of Contents
What are the Hinman documents?
The Hinman documents relate to internal SEC messages concerning a speech given by former SEC Director William Hinman in 2018. In that speech, Hinman stated that cryptocurrencies like Bitcoin and Ethereum may initially be classified as securities. But, as they become more decentralized, can transition into something more similar to a commodity.
Ripple requested these documents in discovery during their lawsuit with the SEC and received them on 21st October 2022. The SEC attempted to keep the documents sealed by claiming that they were not relevant to the case. However, on 16th May 2023, Judge Torres denied the SECâs motion to seal and ruled that the documents were subject to public access.
When will the Hinman Speech Documents be unsealed?
The Hinman documents are expected to be unsealed on 13th June 2023.
What can we expect from the Hinman documents?
We can expect to see emails and comments made by Hinman, Valerie Szczepanik and SEC staff in relation to Hinman’s speech, as well as drafts of the speech itself. These documents will only have limited redactions.
Would the Hinman documents refer to the XRP token?
The Hinman documents may mention XRP because the SEC enforcement team was dealing with XRP in other matters around the same time Hinmanâs speech was being drafted and commented on. Additionally, XRP ranked 2 or 3 in market capitalization following Bitcoin and Ethereum at that time. (Phentermine) So, XRP was definitely in the forefront of the SEC’s minds at the material time.
Why are the Hinman documents important for crypto?
The Hinman documents are important for the crypto industry because they talk about how cryptocurrencies could transition from securities to commodities. This means that the legal status of cryptocurrencies could change over time as they become more decentralized. This will have a significant impact on the future of cryptocurrency regulations. The outcome of the SEC’s case against Ripple could also set a legal precedent. This would in turn affect the entire crypto industry.
Why are the Hinman documents important to the SEC v. Ripple case?
The Hinman documents are important to the SEC v. Ripple case. Including all current and potential enforcement actions by the SEC against other crypto projects, exchanges, companies, and tokens. This is because the documents may contain comments suggesting that XRP does not satisfy all elements of the Howie Test. This implies that it is not a security for purposes of the Federal Securities Laws.
Ripple CEO Brad Garlinghouse is anticipating the release of these documents, saying that they will be “well worth the wait”. This suggests Ripple expects the documents to contain information favouring Ripple and their contentions that XRP is not a security.
Predictions on the likely outcome of the SEC vs Ripple lawsuit?
There are predictions that there will be a 25% chance that Ripple will see an outright victory in the SEC vs Ripple lawsuit. Versus a 5% chance of an outright win by the SEC.
What is the potential impact of the Hinman documents on the crypto market and XRP holders?
The release of the Hinman documents could shed light on the SECâs views on crypto. Especially as the SEC pursues its case against Ripple. The entire crypto industry is closely watching the case over whether XRP is a security. This is because it could set a legal precedent which would affect the entire industry. This ruling could also affect Rippleâs fair notice defense and the court could issue a summary judgment ruling soon. Some suggest that the court may even announce it before 30th September 2023. Therefore, the release of the Hinman documents could have an impact on the crypto market and XRP holders.
Lawyer John Deaton is positive that the SEC vs Ripple lawsuit will be in Ripple’s favour. He also predicts that in such case, the prices of the XRP token may go up from US$2 to $10. As at 13th June 2023, the price of XRP is US$0.52.
In the past year, layer 1 (L1) blockchains have exploded, facilitating ecosystem pumps throughout the market. L1s have become a viable alternative blockchain to Ethereum, the OG. They offer better scalability, lower fees, native DApps, risky meme tokens, massive APYs and more.
As smart investors, we know that when an ecosystem is performing well, its underlying token is a great opportunity to make substantial profits. And with the Solana and Nomad hack happening recently, other L1s have become increasingly popular as investors are looking for a more secure and innovative blockchain.
Aptos and Sui are among the most discussed L1s recently, with many venture capitals (VC) expressing investment interest in them.
Both show a lot of promise to blockchain veterans as these web3 startups are formed by ex-Meta (formerly Facebook) blockchain developers as well as their infrastructure being based on Meta’s abandoned blockchain intiative, Diem.
However, both teams have vastly different approaches to tackling the issue of blockchain scalability. In this article, we will compare and contrast Aptos and Sui, and consider which L1 blockchain you should be more bullish on.
What is Aptos?
Aptos is co-founded by Mo Shaikh (CEO) and Avery Ching (CTO), both former Meta employees who have years of experience as a senior developer and engineer in the blockchain industry.
The team behind Aptos, also known as Aptos Labs, consists of an impressive group of PhDs, researchers, engineers, designers and strategists. Moreover, the team at Aptos has been aggresively expanding. They recently acquired several former Solana staff, most notably Austin Virts, former Head of Marketing at Solana.
Aptos utilizes key elements of the former Diem blockchain as well as Move, a Rust-based programming language independently developed by Meta. Aptos claims the network will be able to process over 130k transactions per second using its parallel execution engine (Block-STM), which will mean lower transaction costs for users.
Sui is co-founded by Evan Cheng (CEO), Sam Blackshear (CTO), Adeniyi Abiodun (CPO), and George Danezis (Chief Scientist). They were former senior leaders of Meta’s advanced blockchain research and development organization.
They were responsible for creating some of the most advanced open source components such as the programming language, execution engine and cryptography of the Diem blockchain.
Sui is a decentralized, permissionless L1 blockchain designed to allow creators and developers to build experiences for web3 users. Similar to Aptos, its proof-of-stake network will scale horizontally and organise data such that transactions are executed in parallel. This greatly reduces computational power and transaction costs.
Although both Aptos and Sui use Move as their programming language, their versions differ from each other, as such that their infrastructure operates distinctively on a fundamental level.
Both Aptos and Sui use Move, a Rust-based programming language, for parallel execution, but Sui uses has a different version of it.
In short, Move is an executable bytecode language used to create smart contracts as well as custom transactions on the blockchain. According to Diem’s whitepaper on Move, it focuses on two major digital assets: scarcity and access control. Scarcity imposes limitations on asset creations, preventing any double-spending, while access control manages ownership and privileges.
It differs from other programming language like Solidity because of its use of resources, which is drawn from the mathematical concept of linear logic. In linear logic, formulas are treated as fundamental resources that can only be used once. In the case of Move, “a resource can never be copied or implicitly discarded, only moved between program storage locations“, hence their name “Move”. This mechanism was designed to maximize security without adding complications to transactions, reducing gas fees.
Aptos generally follows the textbook design of Diem’s whitepaper. On the other hand, Sui has a slightly different object model from Aptos. Its storage system is object-centric, which means that you can see most things on the blockchain, including addresses and transactions. These are represented as “objects.”
Though both Aptos and Sui use proof-of-stake as their consensus mechanism, the consensus algorithm behind it is different.
Aptos employs parallelization by dynamically detecting dependencies and scheduling execution tasks using BlockSTM, which is a derivative of the HotStuff consensus protocol.
Sui implements Narwhal and Tusk as their consensus algorithm, which is a DAG-based (directed acyclic graph) mempool used for parallelization at the execution layer. The protocol is asynchronous which means it can withstand DoS (denial of service) attacks.
In terms of security, Sui has a slight edge over Aptos.
Scalability
Instead of home validator case or large-scale decentralization, both Aptos and Sui aim to optimize scalability by maximizing network capacity, similar to Solana. However, the bottleneck would most likely be state growth in the ecosystem.
To address the state growth bottleneck, Aptos prioritizes heterogeneous validators (constrained CPU and storage), whereas Sui plans to shard data storage efficiently, and scale its resources horizontally.
Tokenomics
There are five major components of the Sui economic model:
SUI token: SUI is the native coin of Sui. Gas fees: all network operations on the platform require gas fees. Gas fees are rewarded to participants in the proof-of-stake mechanism. It can also be used to prevent spam and denial-of-service attacks. Storage fund: In order to compensate future validators for the storage expenses of previously stored on-chain data, Sui’s storage fund is used to distribute stake rewards over time. Proof-of-stake mechanism: Used to select, incentivize and reward platform operators i.e. the validators and SUI delegators. On-chain voting: for voting and deciding on governance and protocol upgrades.
On the other hand, Aptos has no coin yet and its whitepaper has yet to be published. However, Aptos has launched their testnet in March and its developer community has been very active. For more information on their testnet development, you can read our previous article here.
Funding
Aptos Labs has raised $350 million in total from FTX Ventures, Jump Crypto, a16z, Tiger Global, Multicoin Capital, among many other capital ventures. Currently, Aptos Labs has 28 investors.
Sui is fast catching up after its latest Series B funding round in September 2022. Mysten Labs, the company behind Sui closed a US$300 million fundraise in this round. This brings Sui to a combined raise of US$36 million so far, after adding up the $36 million from Series A. Sui also states that they are currently valued at over US$2 billion.
Development Status
Aptos launched its Mainnet in October 2022 and developers can now build on Aptos. They are also currently working on improving the gas schedule in 3 parts. In the short term, to have dynamic NFT gas reduction. Then, in the medium term, to have gas-efficient data structures. Finally, the long-term plan is to adopt demand-driven gas costs.
Sui has recently finished their Sui Testnet Wave 2. Their Sui wallet is also up and running, albeit in the Devenet stage. Nevertheless, you can install the Sui wallet and request Devnet SUI tokens to try out the wallet. The Sui wallet currently has features such as sending, staking, and minting their Capy NFTs. Users can also register their domain name on Sui Name Service. (https://casadelninobilingual.com/)
Conclusion
It is still too early to say which one you should be more bullish on. Both projects have been developing rapidly and have done an excellent job of optimizing its current design. But whatever the case is, Move technology is most likely here to stay as it shows a lot of promise in blockchain scalability and security.
Frequently Asked Questions (FAQs)
Is Aptos blockchain the same or related to Sui blockchain?
No, Aptos and Sui and completely different and unrelated projects. The only connection between the two projects is that both teams have previously worked in blockchain development at Meta (formerly Facebook).
Is Aptos blockchain better than Sui blockchain?
It is still too early to say which one you should be more bullish on. Both projects have been developing rapidly and have done an excellent job of optimizing its current design. But whatever the case is, Move technology is most likely here to stay as it shows a lot of promise in blockchain scalability and security.
Is Sui blockchain better than Aptos blockchain?
It is still too early to say which one you should be more bullish on. Both projects have been developing rapidly and have done an excellent job of optimizing its current design. But whatever the case is, Move technology is most likely here to stay as it shows a lot of promise in blockchain scalability and security.
What are the similarities between Aptos and Sui blockchain?
Both Aptos and Sui use Move, a Rust-based programming language, for parallel execution on the blockchain, but Sui has a slightly version of it than Aptos.
What are the differences between Aptos and Sui blockchain?
Sui’s version of Move programming language makes it clear when an object is owned, shared, mutable or immutable, whereas Aptos does not. And although both blockchains use proof-of-stake as their consensus mechanism, the consensus algorithm behind it is different. Aptos uses BlockSTM for parallel executions, which is a derivative of HotStuff protocol, whereas Sui uses Narwhal and Tusk, a DAG-based mempool used for parallelization at the execution layer.
Aptos, a repurposed blockchain initiative of Meta’s abandoned web3 project (formerly Facebook). Its mainnet and token launch were hugely anticipated owing to its revolutionary infrastructure that might just surpass all other layer-one protocols. All you need to know about Aptos is in this article, made simple to understand and updated in real time.
Aptos also known as Aptos Labs is a web3 startup focused on building a scalable layer-1 blockchain. I know what you’re thinking, not another new smart-contract layer claiming to be more scalable than the others.
But Aptos is not a new entity of its own, in fact, the company was founded by developers who formerly worked on Diem, Meta’s blockchain initiative that was abandoned in January. This means that the project already has a solid foundation to build its products off of.
Key Features of Aptos Blockchain
Aptos utilizes key elements of the former Diem blockchain and Move, a Rust-based programming language independently developed by Meta. The company also claims the network will be able to process over 130k transactions per second using its parallel execution engine (Block-STM), which results in low transaction costs for users.
For context, most blockchains either execute smart contracts sequentially or require a massive parallel workload for improved performance, which requires a lot of power. Aptos differs from other blockchains because a single failed transaction will not hold up the entire chain. Instead, all transactions are processed simultaneously and validated afterwards. The ones that failed are aborted and re-executed, thanks to their STM (software transactional memory) libraries which detect and manage conflicts.
As a result, the combination of these technologies streamlines the entire network’s throughput capacity, which has been a major bottleneck for other layer-1 blockchains. This is a short summary of Aptos’ smart contract execution according to their white paperpublished in August 2022. Their model is based on cloud infrastructure as a scalable and cost-efficient platform for building widely-used applications.
Aptos enables DeFi projects to be built on its blockchain. So far, there are over 30 DeFi projects on the ecosystem. These projects include decentralized exchanges, lending protocols, and liquid staking. An example of this is Aries Markets– a margin trading protocol.
Who is the Team behind Aptos?
Aptos is co-founded by Mo Shaikh (CEO) and Avery Ching (CTO), both former Meta employees who have years of experience as a senior developer and engineer in the blockchain industry.
Aptos has been securing a sizeable amount of funding from numerous crypto heavyweights despite the bear market. In March 2022, the company received $200 million in funding from a16z, Tiger Global, and Multicoin Capital, among many other venture capitalists.
Not only Solana staff but a lot of hardcore Solana proponents have jumped ship for Aptos as well. With the narrative of Aptos being the next Solana, people are speculating whether investors actually believe in their tech long-term, or it is simply a pump and dump for venture capital firms (VC) and whales to make back their money due to the series of liquidation across the market. VC-heavy projects should be considered a red flag, but in the case of Aptos, there is more than meets the eye.
Aptos Testnet
Aptos has been focusing on driving the growth of their ecosystem. Since May, Aptos has launched their testnet campaign named “Aptos Incentivized Testnet” (AIT) and is divided into four stages according to their roadmap: AIT1, AIT2, AIT3 and AIT4. The goal is to invite and reward node operators, developers, ecosystem builders, and auditors alike to deploy applications and stress-test the decentralized network, ensuring the community is ready to launch a production-grade Aptos mainnet. Each stage focuses on executing different deliverables that contribute to the overall function of the blockchain.
AIT3 concluded on 9th September 2022, preparing for the final testnet which will lead to the mainnet launch if successful. Throughout the series of testnets, millions of transactions have been carried out, tens of thousands of nodes have been put up, and more than 1,500 have forked the Aptos-core repository. The codebase is open-source and the project has onboarded well over 100 projects. Teams such as Pontem Network, Protagonist, PayMagic, MartianDAO, Solrise Finance and more have already been building and testing on the network.
Furthermore, Aptos also has a grant program to offer project teams and individuals non-dilutive funding in order to further develop the ecosystem. One thing is certain that the earliest projects to develop on a blockchain are the ones that tend to moon if the blockchain is successful.
Aptos Mainnet Launch
Aptos Labs officially launched its mainnet “Aptos Autumn” on 12th October 2022, making it the first blockchain to debut Move technology. The mainnet is currently using the latest version of AptosBFT (version 4), which leverages a Byzantine Fault Tolerance (BFT) consensus protocol with responsive production optimization. To put it simply, this mechanism quickly minimizes the impact of failed validators on throughput and latency, significantly improving the blockchain’s performance. Aptos team has announced that they are developing AptosBFT (version 5) and will release it in a future upgrade.
The Aptos Bridge
The Aptos Bridge went live on 19th October 2022, powered by LayerZero, a trustless omnichain interoperability protocol. With this deployment, users will be able to move USDC, USDT, and ETH into Aptos from Ethereum, Arbitrum, Optimism, Avalanche, Polygon, and Binance Smart Chain. Users can also withdraw their funds out of the Aptos ecosystem, but as of now, there will be a 3-day transfer window to keep the network stable. According to LayerZero Labs, this will decrease as stability and time in production increase.
Another thing to note is that there is a rate limit to the bridge, starting at an outbound value cap of $1 million every 24 hours. As stability and time in production increase, this will also increase. Finally, since Aptos is an entirely new ecosystem, native assets outside of the APT token do not exist. This means that the only way to get other assets into the ecosystem is via “wrapped assets” from other chains.
Aptos Goes into Web3 Gaming
Aptos has recently announced its partnership with NPIXEL, a Korean Triple-A gaming studio. NIPXEL have been behind popular massively multiplayer online role-playing games such as Gran Saga, which boasts 4 million downloads since its launch in Korea and Japan.
Aptos and NPIXEL are joining forces to create METAPIXEL, a Web3 gaming ecosystem. This partnership sees NPIXEL creating games on the Aptos network. The goal of their partnership is to create a triple-A game that boasts true ownership of game assets.
Partnership with Google Cloud
Google Cloud and Aptos Labs have announced an expansion of their partnership, which now includes Google Cloud running a validator for Aptos. Additionally, Aptos has selected Google Cloud as the preferred infrastructure provider for its ecosystem, and the two companies will collaborate on an accelerator program through the Aptos Foundation that supports Web3 startups and developers working on Aptos.
Moreover, Aptos and Google Cloud will collaborate in hosting global hackathons and other events. The purpose of these hackathons is to bring decentralized developer communities together to collaborate and address common challenges. They will also invite both the Google developer community and the Aptos community to participate and work alongside engineers from both companies to deploy projects that can be quickly scaled globally. In line with their joint events at Bitcoin, Consensus, and Converge last year, they also plan to continue engaging their communities through happy hours and panels in 2023.
MoonPay Fiat On-Ramp Integration into Petra Wallet
Aptos Labs and MoonPay have teamed up to make it easier for billions of people to join the web3 space. This means that users can now purchase APT using Apple Pay. Aptos Labs’ wallet, Petra, now features an easy-to-use interface for exchanging value within the Aptos ecosystem. The partnership began in November 2022 when APT became available on MoonPay.
The integration of the MoonPay fiat on-ramp into Petra was a crucial step in enhancing the web3 user experience. The fiat on-ramp makes it easy for both new users and early adopters to get started on the Aptos network, as they can purchase APT using a variety of payment methods, including Visa, Mastercard, Apple Pay, and Google Pay.
Securing Move as the Underlying Programming Model
To ensure that Aptos is secure, their team has been developing bug-free code through a combination of disciplined software engineering practices and the right tools. This includes mandatory code review, continuous testing and integration, and best practices in the Rust ecosystem.
Moreover, Aptos has contracted auditing companies (Certik, Holburn), conducted community auditing, and worked closely with OtterSec. They also run a bug bounty program that offers rewards of up to $1,000,000 for critical bugs and $100,000 for crash bugs. Aptos has invested in fuzzing and added redundancy through a paranoid mode in the Move Virtual Machine.
Lowering Gas Fees with Community-Driven Feedback
Aptos is engaging with community builders to improve its ecosystem, with a focus on reducing gas fees. The team has analyzed on-chain data and interviewed builders to gather insights. Their three-stage plan includes reducing costs for dynamic NFTs, developing gas-efficient data structures, and creating a demand-driven gas model.
The current gas framework combines execution and storage fees, leading to an unbalanced gas price. The team will separate storage and execution fees and provide storage refunds to solve these issues. The team is committed to delivering these improvements in the coming months to better serve the network’s demand.
What is the APT token?
APT is the native token of the Aptos platform. The APT token is used to pay for transaction and network fees on Aptos.
Fees will be charged on all transactions on the network and are specified in Aptos tokens. Validators will have the opportunity to prioitise the highest-value transactions on the Aptos network, and to discard transactions of lower value. The result is that the blockchain would still be able to operate efficiently when the system is at capacity. Eventually, network fees will also be deployed so that the cost of using Aptos would be proportionate to the costs of deploying hardware, maintenance, and node operation.
In addition, APT can be used for governance voting on upgrades to the protocol and on/off-chain processes, and to secure the blockchain by way of a proof-of-stake model.
Validators holding a minimum number of staked APT tokens can participate in transaction validation on the Aptos blockchain. The benefit of being a validator is that they can decide on the division of rewards between themselves and their respective stakers. On the other hand, stakers can select any number of validators to stake their tokens with in order to receive a pre-agreed split of the rewards. Rewards will be distributed to validators and stakers at the end of every epoch.
At present, the maximum reward rate for stakers starts at 7% per annum and this amount is evaluated at every epoch. The maximum staking reward however will decrease by 1.5% per year until it reaches 3.25% per year. However, all reward amounts and mechanisms can be changed by governance voting.
Aptos Token Listing
Binance announced the listing of Aptos (APT) on their exchange and trading of the APT token commenced on 19th October 2022, 01:00 UTC. The spot trading pairs include APT/BTC, APT/BUSD, and APT/USDT, and withdrawals for APT will open on 20th October 2022, 01:00 UTC. Moreover, the listing fee for APT is at 0 BNB and users can now start depositing APT in preparation for trading.
In addition, Binance will add APT as a new borrowable asset on cross margin and isolated margin within 48 hours from 19th October 2022, 01:00 UTC. Both margin pairs include APT/BUSD and APT/USDT.
Where can I buy the Aptos ($APT) token?
Aptos and MoonPay have recently partnered up to allow Petra wallet fiat on-ramps. So users can now buy APT using Visa, Mastercard, Apple Pay and Google Pay.
The APT token can also be purchased and traded on the following exchanges: Binance, Coinbase Exchange, OKX, and Digifinex.
Start trading $APT on Binance and enjoy 20% off trading fees by signing up here.
Is Aptos Worth Investing?
Aptos offers unique and promising features that cannot be found in other layer-1 protocols (except for Sui which is also a Diem-based blockchain). As such, Aptos has the potential to compete with Ethereum and Solana in terms of scalability and overall network capacity.
However, Aptos is heavily backed by venture capitals (VC), and in light of the VC bankruptcy domino effect toppling across the industry, investors should be cautious when dealing with VC-heavy projects. In fact, according to Aptos Explorer, its total supply is over 1 billion and more than 800 million of the tokens are actively staked, suggesting that early investors, private buyers, and the Aptos team collectively control 80% of the token supply.
Nevertheless, at the end of the day, Move technology is most likely here to stay as it is a revolutionary programming foundation for blockchain scalability and security. And with decades of experience in the blockchain industry as well as Meta, Aptos Labs stakes its reputation on the long-term success of the blockchain.
Frequently Asked Questions (FAQs)
What is Aptos?
Aptos is a layer-1 blockchain that uses key elements of the former Diem blockchain and Move, a Rust-based programming language independently developed by Meta.
How to buy Aptos?
Binance announced the listing of Aptos (APT) on their exchange, and will be available for spot trading at 19th October 2022, 01:00 UTC.
Does Aptos have a coin?
Binance announced the listing of Aptos (APT) on their exchange, and will be available for spot trading at 19th October 2022, 01:00 UTC.
When is Aptos ICO?
Binance announced the listing of Aptos (APT) on their exchange, and will be available for spot trading at 19th October 2022, 01:00 UTC.
Who is the Aptos team?
The Aptos team consists of researchers, designers and engineers of Diem, Meta’s blockchain initiative that was abandoned in January 2022. Aptos currently has 60 employees on their team.
Who is the founder of Aptos?
Aptos Labs is co-founded by Mo Shaikh and Avery Ching, both former Meta employees who have years of experience in the blockchain industry.
Is Aptos funded?
Aptos Labs has raised $350 million in total from FTX Ventures, Jump Crypto, a16z, Tiger Global, Multicoin Capital, among many other capital ventures. Currently, Aptos Labs has 28 investors. Aptos Labs also received an undisclosed amount in strategic investment from Binance Labs, bringing its valuation to $4 billion.
What is the Aptos testnet?
Aptos has an incentivized testnet program where the Aptos team welcomes community members to help with testing. The first testnet was Aptos Incentivized Testnet 1 (AIT1) where the community and the Aptos team created and deployed a decentralized network for over a week. Those who met a 95% participation rate were rewarded. Eligible individuals who were unable to meet the original expectation, but still participated in at least 5% of the testing rounds were also offered 50% of the rewards.
Aptos Incentivized Testnet 2 (AIT2) was concluded in late July 2022.
The latest Aptos Incentivized Testnet 3 (AIT3) opened for registration on 19th August 2022 and will launch on 30th August 2022. Participants that meet the team’s success criteria will receive 800 Aptos tokens. For more details and signup, check out the Aptos blog.
Is Aptos Labs listed on any stock exchange?
Aptos Labs is a private company and is not listed on any stock exchange.
What is the price of Aptos Labs (APTOS) cryptocurrency?
Aptos Labs (APTOS) does not currently have a cryptocurrency token. Binance announced the listing of Aptos (APT) on their exchange, and will be available for spot trading at 19th October 2022, 01:00 UTC.
Is Aptos the same or related to Sui?
No, Aptos and Sui and completely different and unrelated projects. The only connection between the two projects is that both teams have previously worked in blockchain development at Meta (formerly Facebook).
Is Aptos worth investing?
Aptos shows a lot of promise but investors should be cautious as the project is heavily funded by venture capitals. But at its core, Aptos’ programming language, Move, is most likely here to stay as it offers better scalability and security compared to other layer-1 blockchains.
Early Aptos network participants were given an airdrop of APT tokens. A total of 20,067,150 APT tokens were airdropped to 110,235 participants.
How do I participate or be eligible for an Aptos APT airdrop?
Previous Aptos users who had completed an application to join the Aptos Incentivized Testnet or minted an APTOS:ZERO testnet NFT were eligible to claim APT tokens. Those who were eligible to receive APT tokens were notified by the Aptos team via email. There are no plans for further airdrops for the time being.
Which wallet support Aptos?
Petra Wallet and Pontem Wallet are native non-custodial wallets for the Aptos ecosystem, and can integrate with many Aptos DApps.
Why is Aptos dumping?
Aptos’ price usually comes under pressure whenever there is a token unlock event. This is because early investors will typically sell those unlocked tokens to take profit. The next one will unlock on February 12, 2023.
What is the price prediction for Aptos in 2023?
Aptos will most likely increase in value, as the narrative for layer-1 blockchain scaling solution is trending in 2023.
China’s national digital currency DCEP (Digital Currency Electronic Payment, DC/EP) will be built with Blockchain and Cryptographic technology. This revolutionary cryptocurrency could become the world’s first Central Bank Digital Currency (CBDC) as it is issued by the state bank People’s Bank of China (PBoC). The goal and objectives of the currency are to increase the circulation of the RMB and its international reach – with eventual hopes that the RMB will a global currency like the US Dollar. China has recently established an initiative to push forward Blockchain adoption, with the goal of beating competitors like Facebook Libra – a currency that Facebook CEO Mark Zuckerberg claims will become the next big FinTech innovation. China has made explicit that Facebook Libra poses a threat to the sovereignty of China, insisting that digital currencies should only be issued by governments and central banks. DCEP is not listed on cryptocurrency exchanges and will not be for speculation of value.
The significance of DCEP is that it’s designed as a replacement for the Reserve Money (M0) system, cutting back the cost and friction of bank transfers. It is suggested that DCEP will alleviate the risks of offline paper money transactions such as anonymous counterfeiting, money laundering and illegal financing. This is because regulators can better monitor digital currency transactions, which some consider will greatly improve financial and monetary supervision. DCEP can also reduce the costs involved in maintaining and recycling banknotes and coins.
Basically, DCEP is poised to become a digital version of the RMB.
Furthermore, the issuance of DCEP is conducive to promoting the internationalization of the RMB and reshaping the current cross-border payment system. This is because prior to the RMB Cross-Border Inter-Bank Payments System (CIPS) going live in early October 2015, RMB cross-border clearing and settlement was mainly done through CHIPS (Clearing House Interbank Payments System) or SWIFT (Society for Worldwide Interbank Financial Telecommunication). However, some consider that both the CHIPS and SWIFT systems have fatal flaws. Firstly, CHIPS is a US company. Whilst SWIFT, in particular, is seen as a cause for concern to the Chinese because due to its foothold in the international banking system, it is almost essential to use SWIFT for inter-bank transfers across countries. Thus whoever controls SWIFT’s data center will have access to information on almost every cross-border remittance, which some in China posit is the US. This is because whilst SWIFT claims to be a neutral international organization, 12 of the 25 directors are either from the US and her allies. Also, its transactional data were found to have been supplied to the US. Hence it is thought that China is being held back by the US via the SWIFT system, and so, in internationalizing the RMB- China requires its own worldwide banking system- i.e. DCEP.
Hence the Chinese consider that it is a requirement to form a new currency clearing network.
According to Chinese media, DCEP is seen as the “3rd Wave” aimed at the US.
A mandate to adopt Blockchain
China has established a countrywide initiative to push forward Blockchain Adoption. President Xi Jinping has mandated that the ‘countryâs development of blockchain technology should be sped up ‘ on Oct 24th in front of the Political Bureau. This speech has also been echoed by Li Wei, head of the People’s Bank of China. In April of 2020, China launched the Blockchain Service Network to unify all the Blockchain related projects in the Nation.
China has adopted the “Blockchain, not Cryptocurrency”, whereby the benefits of Blockchain is highlighted. On the other hand, cryptocurrencies that are native to Blockchain are suppressed as Cryptocurrency Exchanges and ICOs are banned in the country.
History and development of DCEP
Development of DCEP started in 2014 with the establishment of a research institute dedicated to digital currencies and looking at how to improve the Chinese Yuan system with blockchain technology. However during 2014 to 2018, the development process slowed down, probably because the decentralised nature of Bitcoin or blockchain is incompatible with the nature of the Renminbi as a legal national currency. Things rapidly picked up towards the end of 2019 however and this was directly attributable to Facebook preparing to launch Libra, particularly as partner members of the Libra Association and the currencies which Libra was to be backed by had consciously rejected China. Hence, feeling the heat of the competition, Chinaâs central bank felt immense pressure to urgently speed up in the global competition towards a digital currency.
Former Vice-chair of the PBoC’s National Council for Social Security Fund announced on 22nd June 2020 that China had already completed the backend infrastructure of DCEP.
Uses for DCEP
DCEP will be the only legal digital currency in China
DCEP is a currency created and sanctioned by the Chinese Government. It is not a 3rd party stable coin such as Tether’s cryptocurrency token “CNHT” which is also pegged to the RMB in a 1:1 ratio. DCEP is the only legal digital currency in China (cryptocurrencies such as Bitcoin are not legal tender in China).
Huang Qifan (Chairman of the China International Economic Exchange Center) said they have been working on DCEP for five to six years now and is fully confident it can be introduced as the country’s financial system. It’s currently being rolled out, with the People’s Bank of China issuing the currency. According to a speech by Huang at the China Finance 40 Forum, “DCEP can achieve real-time collection of data related to money creation, bookkeeping, etc, providing useful reference for the provision of money and the implementation of monetary policies.”
DCEP is not for speculation
China has made it explicitly clear that its National Digital Currency is not for speculation. Mu Changchun, Head of the People’s Bank of China digital currency institute made it as “a digital form of the yuan” and that “The currency is not for speculation. It is different to Bitcoin or stable tokens”. This is to the disappointment of the online community in China, where some netizens commented “So there will be no fun in it” on Sina.com.
It is also not possible to mine DCEP or stake on the DCEP network.
Cross-border payments with m-CBDC Bridge
China has joined forces to explore cross-border payments for digital currencies alongside Hong Kong, Thailand, the United Arab Emirates (UAE), and the Bank of International Settlements (BIS).
According to a joint statement in February 2021, the Peopleâs Bank of China and the UAEâs central bank are taking part in the Multiple Central Bank Digital Currency (m-CBDC) Bridge project initiated by the Hong Kong Monetary Authority and Bank of Thailand in 2019.
The m-CBDC Bridge project will explore the capabilities of distributed ledger technology, through the development of a proof-of-concept prototype. The project ultimately aims to facilitate cross-border, multi-currency, real-time transactions around the clock.
This move aligns with Chinaâs long-term ambition to use DCEP to boost the use of RMB in international payments. While the project is currently an alliance between just Beijing, Hong Kong, Bangkok, and Abu Dhabi, it is strongly supported by the BIS, an organisation owned by 63 central banks.
The announcement also comes mere weeks after Chinaâs joint venture with SWIFT, the dominant network facilitating international payments between banks. The new entity, Finance Gateway Information Service, was registered in Beijing on January 16 with âŹ10 million (US$12 million) as incorporation capital, according to the National Enterprise Credit Information Publicity System, the Chinese governmentâs enterprise credit information agency.
Special features of DCEP
DCEP is a Centralized Currency
DCEP is a digital currency that is run on a centralized private network – the Central Bank of China has complete access and control of the currency. This is a huge contrast to Bitcoin, which has an open decentralized network where there is no centralized leader. In the case with DCEP, the Central bank of China has the ability to create or destroy DCEP.
NFC Contact based payment
According to Official Sina Blockchain, DCEP will have NFC based payment options that don’t require devices to be online during the transfer. This will be poised as a direct replacement of paper money, as DCEP will be usable in areas without internet coverage. In addition, DCEP doesn’t require the mobile device to be bound to a bank account – meaning the unbanked population will also have access to the digital currency.
With DCEP’s tap payment feature people can transfer money simply by tapping two phones together, without the use of the Internet. So DCEP is not exactly like blockchain either, rather it is their own variant.
China Construction Bank launches DCEP wallet
On 29th August 2020, China Construction Bank (CCB) had a soft launch of the DCEP wallet. Users of one of China’s big four state-owned commercial banks found a DCEP wallet feature was available inside their mobile app. Users were even able to navigate to the digital yuan wallet and activate it through registering their mobile phone numbers.
Finally, users can send/receive digital currency to others by inputting their unique wallet ID or the phone number associated with the bank account.
CCB DCEP wallet
However, CCB has disabled the DCEP wallet feature from public access, but not before it gained huge attention. Users searching for this wallet now will only get an error message saying that the function is not yet officially available to the public.
Tencent to be a major partner of DCEP
Tencent’s Meituan Dianping has been in talks with the research wing of the PBoC on real-world uses for DCEP. Meituan Dianping boasts billions of dollars in daily transactions on their mobile app platform offering services such as food delivery (similar to UberEats), B&B bookings (similar to AirBnb), ride hailing services, bike sharing, grocery shopping and more. Basically for those in China, all your daily necessities can be met on the Meituan ecosystem.
The PBoC’s research wing is also in talks with another Tencent-backed company, Bilibili Inc. which provides video streaming services. So whilst the specifics of the partnership are yet to be finalised, it is likely that such cooperation is going to be huge for the mass use of DCEP in China.
According to Caijing magazine, the pilot institutions for DCEP will be the 4 major state-owned banks i.e. China Construction Bank, the Agricultural Bank of China, Bank of China and the Industrial and Commercial Bank of China. This initial deployment will serve as an official production test for the currency system, where the network and security will be validated. In the second phase, DCEP will be distributed to large fintech companies such as Tencent and Alibaba to be used in WeChat Pay and AliPay respectively.
DCEP will operate on a two-tiered system
The issuance and distribution of DCEP will be based on a two-tiered system.
The first tier would be transactions between the PBoC and intermediaries. These intermediaries would be financial institutions (e.g. the 4 major state-owned banks i.e. China Construction Bank, the Agricultural Bank of China, Bank of China and the Industrial and Commercial Bank of China) and non-financial institutions such as Alibaba, Tencent and UnionPay. Here, the PBoC would issue DCEP to the intermediaries.
The second tier would be between the above-mentioned intermediaries and participants in the retail market such as companies (e.g. retail stores) and individuals. In this tier, the intermediaries that have received DCEP will distribute it to retail participants so that it would circulate through the market e.g. through people purchasing items at stores etc.
The main difference in the issuance and distribution of DCEP compared to traditional cash however is the fact that DCEP would be transferred through electronic wallets, rather than bank accounts.
The central government has mandated that all merchants who accepted digital payments (such as Apple Pay, AliPay and WeChat) pay must accept DCEP. This will give DCEP a large nationwide acceptance in China, with every merchant obligated to participate or face a potential loss of their business license. This will make DCEP the most accepted digital currency in the world.
DCEP red packets to be launched for Chinese New Year
China’s DCEP app has launched a red packet gifting feature in time for the Chinese New Year on 22nd January 2023. The app will allow users to send the red packets i.e. “hongbao” containing DCEP to others. This is based on the Chinese New Year tradition of gifting lucky money during the annual festival. In fact, WeChat Pay and Alipay already have this feature for gifting CNY. However, it is the first time that e-CNY will be gifted in such a way, with hopes that this will further pave the way for the mass adoption of DCEP.
DCEP can be used to pay expressway tolls
On 28th December 2022, Chongqing Expressway Group announced it has completed the installation of equipment to accept DCEP for expressway tolls. From 30th December 2022, DCEP can be accepted as payment for tolls on the Chongqing Expressway. Users will need to download the e-CNY app and then simply present the payment QR code at the toll booth.
PBoC’s financial statistics reports now include DCEP/e-CNY
On 10th January 2023, the PBoC released its annual Financial Statistics Report for 2022. What is worth noting is that for the first time, the PBoC included statistics on DCEP/e-CNY. The Report states that as of the end of December 2022, the amount of digital currency in circulation was 13.61 billion yuan. This equates to around 0.13% of the total balance of yuan (13.61 trillion yuan) in circulation at the end of 2022.
Are people in China using DCEP?
According to a report on 28th December 2022, there has been over US$14 billion worth of DCEP transactions since its launch in 2020. Meanwhile, 261 million users have already set up an e-CNY wallet. However, this is considered low adoption since around 903.6 million people use mobile payments in China, according to a 2021 UnionPay report.
DCEP scams
Mere hours after DCEP has been announced, various (potentially scam) Chinese exchanges have listed IOUs or knock-offs clones of DCEP. It’s important to know that DCEP is currently only distributed to banks working with the PBoC and will not be available for the public. If you want to find out what are reputable exchanges, check out our top cryptocurrency exchanges guide. It is strongly recommended NOT to trade DCEP until it is officially released as there is no guarantee exchanges have access to the digital currency.
Knock-off clones of DCEP are already trading in (potentially) scam exchanges.
How to buy DCEP?
Currently, DCEP is only available to other banks working with the People’s Bank of China. This will eventually open up to the general public in 2020. There are currently no cryptocurrency exchanges that trade DCEP.
Implications of DCEP?
Is DCEP a challenge to the US monetary system?
The overwhelming view appears to be yes, both from the Chinese and the US perspective. According to statistics from the World Bank, 1.7 billion adults around the world use cash because they don’t have bank accounts. However, two-thirds of this population own a mobile phone, which can be used to make monetary transactions. This is what’s been happening in China, where mobile payments such as Alipay or WeChat Pay have more than 1.7 billion customers across China. Currently, the two online payment companies handle more payments monthly than Paypal did in the whole of 2017 (i.e. USD $451 billion). It’s very common in China to see street vendors accepting Alipay or WeChat pay.
Alipay and WeChat being accepted at an ATV rental shop
With the mobile wallet payment infrastructure in place, their cooperation with the PBoC could be the answer to distributing DCEP overseas. This would fit China’s “Belt and Road Initiative”, the aim of which is to build a new trade route connecting Asia with Europe and Africa. The idea is that with DCEP being used by mobile wallets, populations along the Belt and Road can be connected, bypassing existing financial infrastructures completely and giving an opportunity for the unbanked to pay for online purchases and build their savings.
In the US, the government does not see a demand for digital currencies. In a letter from the Chairman of the Federal Reserve, Jerome Powell, he took the view that many of the challenges a digital currency intends to solve do not apply to the US. In his view, the US payments landscape is already highly competitive and innovative, with plenty of digital payments options for consumers. Powell also commented, echoing the sentiments of those US lawmakers opposing Libra, that a digital payment where you would know and be able to track each and every payment would be unattractive for the US.
Whilst the House Committee on Financial Services also sees Libra as potentially raising national security concerns, observers consider the challenge from China is not being taken seriously. Because on the other hand, China is worried that Libra will reinforce the dominance of the US Dollar and is therefore working on fast-tracking the launch of DCEP. And it is likely that China will outrun the threat from Libra.
From a wider perspective, some take the view that DCEP can be used as a weapon against the US in an economic war. This is because as DCEP becomes accepted across the Belt and Road, China will have the power of total surveillance and control over the economic activity of potentially half the world’s population. DCEP will allow China to track everyone’s spending and transactions, and can seize or lock customers’ digital assets in their mobile wallets. We’ve already seen this in China, where together with its “social credit system”, millions of individuals have already been barred from purchasing airline tickets using their mobile wallets.
Appearance on Chinese television debate show “Tiger Talk”
On 29th August 2020, I appeared on China’s Phoenix Television show “Tiger Talk” (ä¸čä¸ĺ¸čŤ). Tiger Talk is one of Phoenix TV’s longest-running shows, each week they feature a debate on a major societal issue or event, and would invite experts, academics and guests to participate in the discussion. I was invited by Phoenix Television as an overseas analyst to discuss the topic of the week, namely, “DC/EP: China’s release of digital currency, will it shake the US Dollar’s hegemony?”. You can watch the episode here.
Guest appearance on Tiger Talk
Implications of DCEP on Bitcoin and cryptocurrencies
In the first instance, it should always be borne in mind that DCEP and Bitcoin/cryptocurrencies are vastly different. Key differences are that DCEP does not necessarily use blockchain technology and that it is a centralised currency under the control of a centralised authority. Learn more about the differences between DCEP, Libra, Bitcoin and Cash.
However, the large scale promotion of DCEP on national television in August 2020 is certainly bracing and preparing Chinese citizens for a digital version of the RMB. The gradual rollout of DCEP will also get the average citizen accustomed to the actual usage of digital currencies.
As a result, many people are excitedly speculating on the possibility of a bridge between DCEP and various existing blockchain projects- with some projects proclaiming they will be the first project to launch on DCEP. However it must be borne in mind that we do not know the full technical details of DCEP, so we do not know how this bridge between blockchain and DCEP will work, if at all. Also, the fact is that China is currently very hostile towards cryptocurrencies, this is mostly due to a number of cryptocurrency scams- such as Plus Token. As a result, the Chinese government have closed several bank accounts found to be involved in cryptocurrency transfers and banned all ICOs, several major cryptocurrency exchanges such as Binance and OKEx and some Over the Counter desks. Hence a lot of cryptocurrency circles and discussions occur underground, such as in private WeChat groups.
In a confusing twist, however, the CCP’s official media outlets ĺčćśćŻ, Xinhua and CCTV have been pushing out headlines that crypto assets are the best-performing asset year to date. Dovey Wan, Founding Partner of Primitive Ventures has observed that the real intent behind this media push is difficult to interpret, but so far the Chinese cryptocurrency community see this as a signal that crypto has reached its top. Meanwhile, on the Western front on Twitter, people have been seeing this as a bull signal. Currently, without any further moves or news in China about DCEP or on the cryptocurrency front, we can only wait and see what China’s next move will be.
Hmm this is an interesting propaganda vibe from CCPâs official media outlets as âĺčćśćŻâ, Xinhua and CCTV2
the headline âcryptoasset is the best performing asset YTDâ was featured on all avenues, news paper, online media and TV
Will DeFi push governments to finally adopt CBDCs?
Decentralised Finance (DeFi) can be considered the cryptocurrency and blockchain star of 2020, having revived the cryptocurrency market and bringing some much-needed revival and positivity. But what is DeFi? In short, DeFi attempts to bring traditional banking to developing industries, but with a twist: it would be open-source, decentralised, cheap and will cut out the middlemen. (Xanax)
So what can central banks and government do to maintain their dominant status quo whilst benefitting from the technology that DeFi can bring? An answer could be to create a CBDC. In a Forbes article, the author suggests that CBDC would be a positive move for governments since it tokenises money whilst allowing users to enjoy the advantages of cheaper, faster transactions.
The article also touches upon our coverage of DCEP and discusses China’s progress in testing DCEP contrasted with the progress of introducing a CBDC in the US. It suggests that governments and institutions, however, will need to be quick to catch up as new DeFi solutions in payments, mortgage, insurance etc. are being created weekly, and this legion of fintech innovators are growing. These innovators challenge the status quo, and with the mounting advantages of DeFi, there may soon be a real contender vying for the attention of citizen-consumers.
FAQs
Is DCEP backed by Gold?
The simple answer is u0022Nou0022. On a recent episode of Kitco News, journalist Max Kaiser claimed that China will launch a gold-backed cryptocurrency, with the intention of destroying the USD as a reserve currency. He added that China has already amassed as much as 20,000 tons of gold. However this is mere speculation – China has no plans to return to the Gold Standard nor issue gold-backed cryptocurrencies.
Will DCEP be interoperable with other Cryptocurrencies
There are many plans to build gateways that allow the swapping of DCEP to other cryptocurrencies. Projects such as Algorand have stated they want to support DCEP and build possible bridges to swap these currencies. However, as the technical details of DCEP have not been fully revealed, such bridges have not been built yet.
Who can issue e-CNY?
There are 7 Chinese commercial banks that can provide e-CNY. They are: ICBC, Agricultural Bank of China, Postal Savings Bank of China China Construction Bank, Bank of China, Bank of Communications, and China Merchant’s Bank. There are also 2 online banks that can provide e-CNY i.e. WeBank (WeChat Pay) and MyBank (Alipay).
Which Chinese Cities can sign up and use the e-CNY app?
Currently, there are 12 cities and areas in China which can sign up and use the e-CNY app. They are Shenzhen, Suzhou, Beijing Xiong’an, Chengdu, Shanghai, Hainan, Xi’an, Changsha, Dalian, Qingdao, and Zhangjiakou.
Can tourists or non- Chinese locals use DCEP?
No, DCEP is not fully rolled out yet and is only available in select cities in China.
Is China using DCEP?
According to a report on 28th December 2022, there have been over US$14 billion in transactions since the launch of DCEP in 2020 and October 2022. Meanwhile, 261 million users have already set up an e-CNY wallet. However, this is considered low adoption since, according to a 2021 UnionPay report, around 903.6 million people use mobile payments in China.
When will China officially launch DCEP e-CNY?
Whilst there is ongoing DCEP/e-CNY testing on in increasing scale, there is no official announcement as to when and how China will fully roll out DCEP/e-CNY.
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 Ethereum is steadily approaching the transition to a Proof-of-Stake mechanism, one notable thing that has changed, aside from further protocol development, has been the change in terminology.
We have already covered Ethereum 2.0 extensively in one of our ongoing blogs where we go in-depth on everything you need to know about Ethereum’s transition to PoS:
Let’s take a closer look at the rebranding from Ethereum 2.0 to the Ethereum Merge, as well as go over the most recent developments in Ethereum’s roadmap as of May 2022.
Check out our latest video- Ethereum Merge: ALL you need to know (including ETHPOW)
Ethereum Merge: ALL you need to know (including ETHPOW)
The move away from using the former term âEth2.0â that signified the final transition from PoW to PoS was a result of several different developments and considerations, both technical and cultural.
On the technical side, the use of Eth2.0 started to become an inaccurate representation of the PoS transition. Originally, the Ethereum 2.0 roadmap envisioned that both the Phase 0 (Beacon Chain) and Phase 1 (Sharding) would be completed before the final transition. (Clonazepam) But the Beacon Chain was developed faster than expected, making researchers realize that the final migration to a PoS mechanism would be delayed by years due to the focus on sharding. In addition, the ever-growing pressure from the masses about the environmental impact of PoW chains made the migration to PoS that much more pressing.
As the Beacon Chain was deployed, Ethereum L2 rollups started gaining popularity, demonstrating significant scalability potential even for a non-sharded Ethereum blockchain. This released some pressure on solving the scalability challenges that Ethereum’s L1 has faced for years, allowing the R&D team to focus on the remaining Ethereum’s upgrade plans both for the PoW chain, as well the Beacon Chain.
From a cultural perspective, the use of the old terminology would’ve further perpetuated confusion about the nature of Eth1.0 and Eth2.0, making it seem like once Eth2.0 is launched, Eth1.0 will be gone, which is not the case. In addition, scam prevention was another consideration that favoured the rebrand, as the distinction between Eth1.0 and Eth2.0 would’ve likely resulted in scammers trying to convince users to swap their ETH tokens for fictitious ETH2 tokens.
The result of all of this was a decision to move away from the confusing Eth1.0 and Eth2.0 terminology, and rather call the transition to the PoS mechanism on the mainnet The Merge. By choosing to name the process instead of the final outcome (which in reality remains, in essence, the same), a lot of headache and confusion has been avoided.
Progress Towards The Ethereum Merge: Current status
Public testnets being battle-tested
Deployed in late December 2021, the Kintsugi testnet was a public testnet meant to allow execution and consensus client developers and application developers to become familiar with the post-Merge environment. The testnet was bombarded with transactions, bad blocks, and chaotic inputs to battle test it and find bugs.
A new specification for the proceeding public testnet, called Kiln, was published after edge cases from Kintsugi had been discovered. It’s expected to be the last new public testnet to be created before the existing ones are upgraded. Continued extensive testing of the Kiln has been taking place since The Merge took place on it on March 15th 2022. The Ethereum community practised running their nodes, deployed contracts, tested infrastructure, and threw everything they had at it to see if it breaks.
Mainnet shadow forks
Although a lot had been learned since deploying and testing Kintsugi and Kiln testnets, they were still very young testnets with little activity, which prevented proper stress testing of assumptions regarding syncing and state growth. And this is where shadow forking came in. Shadow forking makes it possible to fork an existing testnet, such as Goerli, and the mainnet (with a lot more activity), and add merge related properties to its config, thus allowing the fork to inherit the state of the original testnet.
These shadow forks are short-lived, allowing for testing on them only for a few weeks until a new beacon chain has to be spun up.
Three Goerli testnet shadow forks took place in January and March, and the first mainnet shadow fork happened on April 11th 2022, with the second one following on 23rd April.
The results of the latest mainnet shadow fork have been described by Adrian Sutton from ConsenSys in his twitter thread. The team will continue stress testing main forks, and collaborate with client developers to make them even more robust against edge cases. From now on the main theme as we approach The Merge has been and will be – testing, testing, and even more testing.
Wen Merge? The Triple Halvening, And Price Predictions
As to when The Merge will happen is still somewhat up in the air. No one has, understandably, given any specific dates, but the general consensus is that late Q3 is the time when we are likely to see it finally happen. The dev team’s sole focus is on The Merge, with very little else discussed, as can be seen in the latest AllCoreDevs session update by Tim Beiko.
Price predictions are also under hot debate, as, once The Merge is complete, two factors will influence ETH’s price, one emotional, the other baked into the protocol. Realistic estimates of the fair price of ETH fluctuate around $5000.
The emotional aspect, as experienced by the market, will result from The Merge successfully completing, which will mark the end of the most significant change in the protocol in Ethereum’s history, and solidify the incredible technical competence of Ethereum core devs and researchers, further giving the market confidence in ETH as an asset and the ecosystem as a whole, driving up the price further.
The technical reason for why price is likely to pump is due to the Triple Halvening, which will reduce Ethereum’s annual inflation rate from 4.3% to 0.43%. Following last year’s EIP-1559 upgrade, Ethereum now burns about 70-80% of the fees, with the rest going to PoW miners. Post Merge, these fees will go to the PoS validators. This means that ETH stakers will see their rewards rise to about 8-10%. Staking will lock in significant amounts of ETH, as staked ETH cannot be moved or used in the markets, making enormous amounts of ETH illiquid, further driving up the price. EIP-1559 and The Merge combined are predicted to cause the equivalent of 3 bitcoin halvenings, reducing ETH sell pressure by up to 90%.
In addition, the move to an environmentally friendly PoS mechanism, which will reduce energy consumption by up to 99.95%, will make the asset much more appealing to institutional investors who might’ve been kept away from investing due to public’s pushback on Ethereum’s current energy consumption.
Great progress is being made by the Ethereum team, and the continued successful merges of mainnet forks clearly demonstrate the culmination of 6 years of back-breaking work, and give hope that The Merge truly is just around the corner. For those interested in the nitty-gritty of The Merge preparations, it’s worth checking out The Merge Mainnet Readiness Checklist which lists in detail all of the various tasks that need to be worked through to make The Merge ready for Mainnet release.
Why is the Ethereum Merge so important to crypto traders?
Many cryptocurrency and particularly Ethereum ($ETH) traders are eagerly anticipating the Ethereum Merge because afterward, the issuance of ETH is expected to be reduced by about 90%. This means there will be less ETH in circulation, and in turn, the lower the supply, the higher the demand- potentially resulting in Ethereum prices going up.
ETH Merge is a huge success!
On 15th September 2022 at 06:42:42 UTC at block 15537393, the Merge was completed.
And we finalized!
Happy merge all. This is a big moment for the Ethereum ecosystem. Everyone who helped make the merge happen should feel very proud today.
Missed our historical LIVE Merge party? Check it out here!
Ethereum Merge Party – Watch the Merge live!
How have Ethereum ($ETH) prices reacted to the Merge?
Ethereum ($ETH) prices showed a slight pump in the hours following the Merge. Prices hit a peak of over US$1,640 before coming back down to just under US$1,600. The next crucial point in terms of where ETH prices would go would depend on whether there is any hard fork.
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.
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.
NFTs have become one of the most exciting trends in the blockchain and cryptocurrency space. With many existing projects and more in the works, crypto enthusiasts now consider NFTs as potentially rewarding and an attractive asset. These specialized assets have generated a lot of media hype, speculation, and commendable value for the greater crypto and blockchain ecosystem.
However, many people are still unaware of the specifics which make NFTs work such as minting, applications, and their general significance towards the crypto and traditional sectors. People also donât know what to make of the trend, and whether or not they should participate in the hype. As popular as they are, NFTs suffer from the effects of many widespread myths and misconceptions, making these assets some of the most misunderstood in the finance and blockchain sector.
What are NFTs?
NFTs (non-fungible tokens) are digital assets with uniquely verifiable qualities contained in their metadata. These tokens function as a popular and effective way to represent traditional or blockchain assets because they are non-fungible, meaning they cannot be freely interchanged in a one-to-one manner, duplicated, or forged. Once created, NFTs are permanently etched on the blockchainâs public ledger and are visible by all nodes on the blockchain. The unique nature of NFTs affords them significant utility across various sectors.
While the principle behind NFTs has real-world applications, these assets are still in their infancy. Many people, including crypto enthusiasts, are still only aware of the myths and misconceptions created by mainstream media and do not fully understand these assets which can have huge potential. Here are some of the most widespread myths about NFTs and the truths behind them.
Click here for our in-depth explainer on what are NFTs.
Myth #1 – NFTs Are a Kind of Cryptocurrency
The biggest misconception is that NFTs are a kind of cryptocurrency. Although they are both developed on blockchains, the critical difference is their fungibility. Cryptocurrencies are fungible assets traded only by an asset with the same value. For example, Ethereumâs Ether (ETH) token is only tradable if exchanged for other ETH or another cryptocurrency with the same exact value. On the other hand, each NFT has a unique value and cannot be replaced with another. One Ether is always worth the same as any other Ether, but the same cannot be said about NFTs, making them a digital asset, not a currency.
Myth #2 – NFTs Are Harmful to the Environment
Since creators mint NFTs on energy-intensive blockchains, many people think they are harmful to the environment. However, this is not the case. People are now using the more energy-efficient Proof-of-Stake (PoS) blockchain protocol instead of the Proof-of-Work (PoW) protocol, which is more energy-intensive.
Click here to learn more about Proof of Work vs Proof of Stake.
Myth #3 – NFTs Donât Have Value
Another common misconception about NFTs is that they do not have any value. On the contrary, am NFT derives true and inherent value from the underlying blockchain technology that enables the ownership, transparency, and security of digital assets.
The utility of NFTs transcends digital artwork, avatars, and collectibles. For example, certain NFTs offer holders various uses and benefits ranging from VIP concert passes to private dinner reservations. Additionally, NFTs are applicable in the real estate sector to transfer land deeds or verify ownership.
Myth #4 – NFTs Are Easily Copied and Forged
A common issue with digital collectibles is validating their authenticity and rarity, mainly to prevent the sale of counterfeit or pirated items. This is a problem that blockchain technology quickly solves.
A blockchain maintains a series of public transactions across different computers or nodes. Each node âwitnessesâ all transactions to ensure that they are all 100% authentic. With NFTs, the blockchain creates a clear chain of ownership making collectors confident that their NFT is the one-and-only âoriginal,â also ensuring that buyers can verify authenticity before exchanging money.
Myth #5 – NFTs Encourage Scams and Money Laundering
Many still commonly believe that blockchain assets are for criminals and tax defaulters. However, cash is still much more utilized for nefarious purposes and crime-driven than cryptocurrencies and NFTs. All transactions on the blockchain are completely transparent and easily trackable if there is a need to detect fraudulent activity. Furthermore, in some cases, it is also possible to recover stolen funds from scams or money laundering.
Myth #6 – Buying an NFT Means Owning the Intellectual Property
This myth is more of a technical misconception. Owning an NFT does not automatically give ownership of the underlying asset or its intellectual property rights. Unless otherwise stated, ownership of the intellectual property stays with the creator of the NFT. Even after the purchase, buyers or collectors do not have the right to use the NFT outside the scope outlined by the creator. Think of it as a collectable book or movie; just because you purchase it doesn’t mean you have the right to reproduce or monetize the intellectual property.
Myth #7 – NFTs Are Just a Fad
Like the internet, many people thought NFTs would not catch on or only find applications for illicit activity. Some also believe that these tokens are just hype and will suddenly disappear, leaving many people holding worthless assets. However, given the many possible use cases, NFTs are unlikely to disappear. Â
We can see that NFTs are not dead or just a fad from the launch of video game retailer GameStop’s NFT marketplace. GameStop launched its NFT marketplace on 12th July 2022, ahead of its initial anticipated release after hinting at this for over a year. GameStop has in May 2022 already released its digital asset wallet for users to store, send and receive cryptocurrencies and NFTs in anticipation for this marketplace launch.
The launch of GameStop’s NFT marketplace also appears to be a success, with trade volumes exceeding US$1mil (over 1,028 ETH) in 24 hours. Commentators on Twitter also suggest that GameStop’s launch was even more successful than that of the Coinbase NFT marketplace, since GameStop’s trade volume in 24 hours was equivalent to 60% of Coinbase NFT marketplace’s entire lifetime sales.
Conclusion: NFT Myths?
NFTs are here to stay and are slowly gaining massive traction across the crypto space. Although popularity is on the rise as creators are continuously minting new ones every day, crypto enthusiasts worldwide still need to stay informed about utility to better understand the technology, how it works, and how creators can sustain the NFT market well into the future.
Doing your taxes on your cryptocurrency trades has become a necessary burden for many as major nations continue to implement regulations on the industry, and this is actually a positive thing for global adoption. Huge nations such as the United States are currently looking to introduce stricter regulations for crypto and have already been taxing crypto profits. Therefore, to avoid unwanted meetings with the IRS, American investors are having to play by the old rules.
But if thatâs not something youâre into (long live financial freedom!) or youâre a crypto maximalist, the good news is there are several places in the world that might present better options for you.
This article highlights seven countries around the world that are pro-crypto and some that will even allow you to trade and earn crypto income tax-free. Hereâs our video comparing the top best countries for crypto investors.
Portugal
No capital gains tax on crypto
No personal income tax on crypto received
Portugal is one of the most crypto-friendly countries in the world after establishing a Digital Transitional Action Plan in April 2020 to promote decentralization. The country experienced hyperinflation in the early 1990s which almost drove companies to bankruptcy, so it is no surprise the Portuguese people have shown trust towards crypto.
If you’re making any capital gains from purchasing or selling cryptocurrencies you do not have to pay any taxes, nor is there any income tax on payments received in crypto. If you donât hold an EU passport then you can invest 350,000 euros in funds in the country for five years to become eligible for citizenship via the Golden Visa Scheme. The best part is you’ll only need to spend seven days in Portugal per year, meaning you don’t have to permanently relocate.
2. Bermuda
No income tax at all
No capital gains tax on crypto
As an example of Bermuda’s crypto-friendly nature, we only need to look at the Bitcoin ETF that was approved in late 2020 after years of unsuccessful attempts to launch in the United States. The Bermuda Stock Exchange approved Hashtag’s Nasdaq crypto ETF making it one of the first of its kind and proving that the country is likely to continue to be forward-thinking regarding crypto.
It’s fairly easy to obtain residency in Bermuda as long as you have sufficient income. At least $2.5 million must be invested into real estate, businesses, or bonds in the country in return for a passport.
3. Malta
No income or capital gains tax on long-term crypto investments
35% income tax on crypto trading
Malta is a southern European island in the Mediterranean Sea that has been using crypto for the longest time. Crypto traders receive 35 per cent in income tax as it is viewed as the same as stock trading by legal definition, but on the plus side, there is no income or capital gains tax on long-term investments in digital currencies. So if you’re a long-term hodler you would love Malta, but not so much if you’re a day trader.
If you’re not an EU citizen and want to become one you can buy Maltese citizenship and receive a passport in about one-and-a-half years at a cost of around $1 million dollars. This is more for long-term players who really want to cash out their crypto tax-free.
4. Singapore
No capital gains tax on crypto
No existing crypto funds subject to taxation
Singapore already enjoys the reputation of being one of the most business-friendly places on the globe and is slowly emerging as a safe haven for crypto investors as well. The countryâs central bank believes the crypto ecosystem should be monitored to prevent money laundering and other illegal activities, however, also insists innovation should not be stifled. Singapore is known as the fintech hub of Asia as residents and companies do not have to pay any capital gains tax nor are there any existing funds subject to taxation.
Residency in Singapore is easy for students, who just need to study there for two years and pass a government exam, but the requirement is much higher for their investor program â at least 2.5 million Singaporean dollars (roughly US$1.8 million) must be invested into new businesses or funds.
5. Switzerland
No capital gains tax on crypto
Bitcoin is legal tender in some regions
Swiss banks were the first in the world to offer crypto companies business accounts in 2018 after recognizing that banking channels would help to eliminate fraud and encourage legitimate businesses in Switzerland. Crypto is classified as an asset and Bitcoin is recognized as legal tender in some regions so the narrative for crypto is generally positive. The Swiss don’t see crypto as a threat to their fiat currency.
If you trade or hold any crypto as an investment in your own account and qualify as an individual trader you will not be liable for any capital gains taxes. Residency in the country is a bit tricky in comparison to other countries â you must be under the age of 55 and need to invest at least one million Swiss Francs in a way that stimulates new technology developments in the region.
6. El Salvador
No income or capital gains tax on Bitcoin
Bitcoin recognized as legal tender
Building worldâs first âBitcoin Cityâ
El Salvador made mainstream media headlines and is the undisputed king when it comes to crypto-friendly regulation after Bitcoin was recognized as legal tender in 2021. Consequently, the country has no income tax or capital gains tax on Bitcoin and plans to maintain its status as a crypto hub by building the world’s first âBitcoin Cityâ.
In the future it might also be possible to buy an extra passport and a new nationality with crypto. The law hasn’t been confirmed yet but ever since Bitcoin became legal tender in the country El Salvador has continued to accumulate and now holds more than 1,800 Bitcoin as they want to continue to build up their Bitcoin reserves. Do not be surprised to one day see El Salvador offering citizenship in exchange for crypto investments.
7. St. Kitts & Nevis
No capital gains tax at all
Buy a passport for $150k or BTC equivalent
Move freely between Caribbean Union countries
St. Kitts & Nevis is an island in the West Indies that has welcomed digital assets with open arms and implemented legislation to make crypto transactions easier under its Virtual Asset Bill of 2020. You can use crypto to buy a passport to this tax haven and the best part is you don’t even have to land in the country to get the passport. A passport costs about $150,000 or the equivalent in Bitcoin and you can get it in about four months.
There is no capital gains tax in the country at all and local banks work happily with crypto investors. The island nation has Bitcoin ATMs placed throughout the country and you can live in any other Caribbean countries that are also part of the Caribbean Union.
Conclusion
At the end of the day there are still many countries that consider crypto to be a threat to their sovereignty yet each day more and more nations are realizing the benefits and possibilities of welcoming the innovation of blockchain and crypto. The treatment of digital assets varies depending on each countryâs financial regulations and procedures, which is why it’s essential to do your own research and consult a tax advisor before deciding to immigrate.
The NFT industry has become one of the most exciting spaces amongst emerging blockchain and crypto trends. With many related projects and startups launching, the sector is becoming more popular and has provided creators with significant earning opportunities.
NFT creators constantly seek more accessible ways to publish and market their assets to varied audiences while also maximizing potential returns on their art. Buyers who like to collect NFTs also look for the best marketplace that curates these assets and facilitates easy access to purchases and rewards. The Starly platform provides all these and more to both categories of stakeholders.
Starly is an NFT-focused launchpad and marketplace where users can create, buy, and sell gamified NFT collectables. The platform aims to make creating, selling and collecting NFTs as seamless as possible. Starly offers complete creative control to NFT minters, allowing them to set prices, rarity ratings, and decide preferred launch dates.
Each Starly NFT collection consists of 21 unique NFTs (or NFT cards) divided into three packs for ease of valuation. The packs are composed of 11 common cards, 6 rare cards, and 4 legendary cards. Members of the Starly community can purchase and sell NFT cards on the secondary market, or buy all the cards in a collection to receive special rewards reserved for buyers who acquire complete collections.
NFT Staking on Starly
Collectors can stake their NFT cards for Starly token rewards based on the value and rarity of the NFT. Each NFT card in a collection has a Card Score determined by its pack (common, rare, or legendary) and price. Stakers can earn rewards in $STARLY- the projectâs native token. The total $STARLY staking reward for each NFT card is equal to its Card Score and gets distributed daily for over a year. This means that it would take 365 days to accrue the total $STARLY staking reward.
Although users can claim a limited number of token rewards, these rewards depend on the userâs Starly token tier. Starly uses the following formula for reward distribution:
Card Score/365 = Token Amount Distributed for 24h.
For instance, if a user stakes an NFT with a Card Score of 15,000, the available token staking reward for that card is 15,000 $STARLY. The user can claim up to 41 $STARLY (15,000/365) daily depending on the membership tier until the user exhausts 15,000 $STARLY.
Starly Token Staking Tiers
Token holders staking $STARLY are categorized into reward tiers curated according to the number of staked tokens. The tiers include the Silver, Gold, and Platinum memberships, with the following required token amounts:
Silver Tier: a minimum of 1000 $STARLY staked
Gold Tier: a minimum of 10,000 $STARLY staked
Platinum Tier: a minimum of 50,000 $STARLY staked
These tiers come with varying benefits, including the ability to claim more daily NFT staking rewards. Members of the Starly community who stake their NFTs but have no staked Starly tokens are not placed in any of the three tiers and can claim only 2 of the available daily token rewards. Silver, Gold, and Platinum tier members can claim 10, 100, and 500, respectively.
Furthermore, if an NFT card is unstaked, all unclaimed rewards of the staked card remain locked on the card till the user stakes it again. Additionally, if the unstaked NFT card gets sold, the new owner gets all unclaimed staking rewards locked in the card and can stake the card again for token rewards.
$STARLY Token
$STARLY is the platformâs native token, helping creators earn from their NFT assets. On the Starly marketplace, creators can monetize their NFT collectibles and receive rewards for their effort via $STARLY tokens. The platform has a total supply of 100 million tokens allocated for different uses. For instance, the largest allocation is for the Product and Ecosystem Development Fund at 31.25% or 31,250,000 tokens. Others include 22% for the Team and Advisors, 20% for the private sale, and 0.75% for the public sale. Furthermore, Starly allocated 5% each for token liquidity and staking payouts, while reserving 16% for the community.
Benefits Of Starly NFT Staking
All NFTs have inherent value that provides some aspect of collectibility or utility to collectors. However, collectors can derive additional value by staking these NFTs on Starly. The primary benefit of staking owned NFTs is that users can accrue more $STARLY and then re-stake for added rewards. As users collect more tokens, their designated membership tier moves from Silver to Gold or Gold to Platinum. New tiers furnish users with additional Starly benefits, such as voting rights and exclusive NFT drops from selected artists.
Staking has become a significant way of contributing to projects across the blockchain and crypto space, with billions of tokens and coins locked on many platforms. NFT staking is no different and is an excellent way for users to earn passive income from idle NFT collections. Although the concept is still relatively in its infancy, Starly opens users to more NFT staking opportunities with the possibility of progressive rewards.
The gaming market has seen impressive growth over the last few years and is still set for more expansion. According to a 2021 report, the gaming marketâs valuation for the year hit $198.4 billion. The same report states that the market will register a compound annual growth rate (CAGR) of 8.94% from 2022 to 2027. By 2027, the valuation could jump 71.3% to $339.95 billion.
Several factors contribute to the gaming marketâs popularity, attracting more people to the sector. Game developers are continually improving options and general gameplay, a factor that keeps existing gamers interested enough to stay. In addition to improved features, there is also increased advancement in technology.
The introduction of blockchain technology to the gaming sector is easily the marketâs most significant advancement. Apart from the immutability and security of the gaming infrastructure and assets stored, blockchain also provides players with an opportunity to earn while enjoying their gameplay. Platforms like Colizeum are taking this further by stretching blockchain gameplay features past earning rewards.
Colizeum is an ecosystem bridging the gap between the blockchain and traditional gaming worlds. It is a play-to-earn platform that connects several games and related applications from multiple developers, providing a shared marketplace for developers and gamers alike.
Colizeum continuously closes the traditional and blockchain gaming gap through its Colizeum Software Development Kit (SDK). Conventional game developers can use the Colizeum SDK to effortlessly build blockchain games without the expected technicalities from decentralized applications. The kit also provides a cost-effective way for creators to design and publish games since there is no need for blockchain developer teams.
Why Colizeum?
There are several features the Colizeum ecosystem offers the gaming public. In addition to the ease of creating exciting play-to-earn games, here are a few points to note:
Earnings for All: The Colizeum ecosystem maintains an equal focus on gamer and developer earnings. As players accumulate rewards by participating in their favorite play-to-earn games, developers also earn from gamers and the entire Colizeum community.
In-Game NFTs: Colizeum supports low-cost NFT minting while checking other related boxes, including demand programming and multilayering.
Tournaments-as-a-Service: The Colizeum SDK allows developers to create multiplayer games in different modes and designs. Depending on game specifics, players can enjoy tournaments and earn by winning or simply participating.
Colizeum is a fully-decentralized, anonymous, on-chain, and community-focused ecosystem. The platform also features an Attention Marketplace – a tokenized product that allows the direct monetization of gamersâ attention. Instead of going through Ad Exchanges that charge excessive fees and still keep a large portion of generated revenues, the Attention Marketplace enables transparent user acquisition and monetization via $ZEUM staking. Colizeum already has an exciting list of partners, including the Israeli Blockchain Association, IHODL, and Cex.io.
Benefits to Game Developers
The SDK provides quick and inexpensive game development that can shorten developer timelines by up to 1 year
Creators can introduce a play-to-earn feature to any mobile game, attracting more players and allowing gamers to earn during gameplay
Colizeum is a cross-chain and cross-platform ecosystem that enables gamers and developers to enjoy the best of multiple games regardless of their host platform
In-game assets can be easily converted to NFTs
Since there are no middlemen on the platform, all processes are cheaper and faster
Benefits to Gamers
Colizeum allows players to use one token across all games hosted in the ecosystem
In-game assets are tradeable as NFTs. This will enable players to earn more in addition to direct gameplay. Trading NFTs also serves as passive income for gamers
Enjoy earnings from any of the games hosted by Colizeum
Tokenomics
The Colizeum ecosystem has a total supply of 1 billion $ZEUM tokens available for different purposes. The seed round featured 6% or 60 million tokens, while 13% or 130 million tokens were available at the private round – both with 18-month vesting periods. There also is another 19% allocated to the Colizeum team, 5% to the DAO fund, 15% for strategic partnerships, and 8.650% for its in-game reward program. As a community-focused platform, Colizeum also allotted 10% (100 million tokens) to community incentives.
Colizeum is set to be one of the largest play-to-earn platforms in the blockchain sector as it leverages flexibility and interoperability. Creators will be able to develop games that easily interact with each other, thereby adding to Colizeumâs credibility as the go-to play-to-earn host platform. Furthermore, the earning opportunities available to players across all games will attract more users and also appeal to game developers.
Play-to-Earn experienced a massive wave of adoption during 2021, as crypto-friendly gamers jumped on the opportunity to earn money while playing games. P2E games such as Axie Infinity, Star Atlas, and others saw a dramatic increase in user and revenue growth. However, after the initial hype wave over P2E games settled, what was left was a realization that many of these games lacked truly engaging gameplay, social features, and sustainable tokenomics.
Fast forward to late 2021/early 2022, we witnessed a significant pivot in the blockchain gaming space: Move-to-Earn. M2E has taken the world by storm, with numerous projects popping up and their valuations skyrocketing. Among the younger generations, there is a trend towards self-care and maintaining a more healthy lifestyle as we continuously get reminded of just how much time we end up spending indoors. Covid lockdowns took this lifestyle to the extreme and forced everyone to spend time at home longer than many felt comfortable. Now there is a thirst for a more active, healthier life.
P2E games have had (and continue to have) a good run, but M2E has managed to capture the interest of not only gamers, but also those blockchain enthusiasts who might not be fully on board with just spending time tapping away at their phone screen to earn their P2E tokens. However, every project comes with its own shortcomings. Letâs take a look at these shortcomings and how an emerging project â FitEvo has transformed its platform amidst this trend with a new edge.
With popular M2E games such as STEPN, Genopets, and STEP, you’ll find that they share a common gameplay model in which the user acquires an in-game asset, be it a sneaker or a pet animal, and upgrades it further as they keep on exercising.
But these features on their own are not enough to make an M2E game successful. The focus should be just as much on the social aspects and community engagement opportunities around a user’s physical activities, as it is on the earning and NFT upgrading experiences. And many of the games in this space seem to have forgotten what the most popular traditional social fitness apps such as Strava, FitBit, and MyFitnessPal have already done in order to expand their user base, and keep it engaged.
Strava, one of the pioneers in the social fitness app space, has achieved an enormous global user adoption, boasting nearly 100 million users. Much of this growth can be attributed to the app offering not only a feed of activities of their friends, but also other social features that are geography-centric and community engagement focused.
This precedent for a successful M2E game is exactly the reason why FitEvo is so appealing in terms of fundamentals. FitEvo, an M2E dragon breeding NFT game, has the makings of an incredibly successful blockchain-based game, as they have incorporated many of the social features that people know and love.
FitEvo: Focusing on the Interaction Between Individuals
FitEvo aims to engage the masses through a powerful combination of NFT dragon breeding (evolving together with a dragon companion), and social features that gamify physical activity and human competitiveness, and bring friends and communities closer together.
An engaging and fun dragon breeding game, FitEvo has been inspired by the greats, like Tamagotchi and Pokemon, taking it to the next level by syncing the user’s movements with the development of their very own dragon. In FitEvo, the dragon co-evolves with the user, creating a bond between the two. The hatching of eggs, breeding and evolving of dragons, will be intimately linked to the physical movements of their masters.
And here is where FitEvo will really shine – the social and gamification features. For those familiar with the M2E STEP game, FitEvo will be like a new and improved Step 2.0, incorporating all the crucial engagement mechanisms that have made traditional social fitness apps so popular. If you’re one of those who didn’t manage to get in on STEP early on, it might be worth your while to pay close attention to FitEvo.
The multiplayer feature alone will offer an enormous amount of value to the users, FitEvo allows FITamins(as the FitEvo community calls itself) to meet other like-minded and even geographically adjacent individuals by organizing group runs or other group exercises. Anyone who has ever tried getting back in shape with their friends cheering them up or even being right next to them, sweating off their own dietary sins, knows how much it helps to have someone give you motivation and some peer pressure at your lowest moments. This type of community support will be possible, with FITamins helping each other become their better selves.
Of course, what would a fitness app be without some healthy competition? FitEvo will offer many opportunities to challenge others and stimulate their competitive neurons through classical challenges, as well as user-created routes with leaderboards.
In addition to earning $FIVO tokens through movement, FitEvo has made sure that attention is paid to incentivizing more extensive user engagement beyond exercising and dragon breeding. Users will be able to collect Active Points through interactions, referral count, daily sign-ins, missions completed, community contributions, and more. The Points will significantly influence users’ earnings to the upside, so it will be in everyone’s best interest if they try to make the best of their experiences on the FitEvo app – and why shouldn’t they?
Another interesting feature that we are yet to hear more about is the training programme, which will offer inexperienced users the opportunity to learn from the community and follow pre-planned exercise curricula without having to design them themselves.
Incorporating all of these features will be no small feat for FitEvo, and it will be interesting to see how the project progresses forward. With such a clear edge over their competitors defined, it’s now up to the FitEvo team to deliver on these ambitions and rise through the ranks of the M2E space.
