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  • Bella Protocol ($BEL): One-Click Crypto Banking

    Bella Protocol ($BEL): One-Click Crypto Banking

    Bella Protocol ($BEL) provides a suite of decentralized finance (DeFi) products, allowing users to access existing DeFi protocols. It is the first project to be hosted on Binance’s Launchpool platform. Launchpool is a brand-new initiative designed to bring the DeFi experience to Binance users. Users can stake their crypto holdings, including ARPA, BNB and BUSD, in return for rewards in newly-listed tokens, of which BEL is the first one offered.

    Background

    The team behind the protocol is led by Co-founders Felix Xu (CEO) and Yemu Xu (CGO). Felix has been active in the cryptocurrency scene since 2018 while Yemu bought his first Bitcoin (BTC) in 2016 and has never looked back. Before creating Bella, the CGO had held notable positions at Fidelity Investments, which has $3.3 trillion of assets under management, and Boro, a fintech startup.

    Furthermore, Yemu has links with ZhenFund, a reputable venture capital firm in China. Other team members include individuals with a rich background in blockchain engineering, cryptography, and finance.

    In 2019, the team got into DeFi by providing liquidity to various lending platforms and decentralized exchanges (DEXs). However, the team identified inefficiencies that it took upon itself to solve.

    Their motivation comes from the realization that the DeFi market:

    • Is worth trillions of dollars.
    • Has a low adoption rate.
    • Charges a ton in transaction fees.
    • Struggles with a system of earning rewards.
    • Has limited interaction between DeFi and centralized finance (CeFi).
    • Lacks mobile-friendly products.

    And to add, DeFi products use smart contracts, which is still a foreign subject to most people.

    What is Bella Protocol?

    Bella Protocol is a network of open financial tools that aim to boost the adoption and ease of use of DeFi systems while throwing in a banking aspect into it. The network’s main offerings include a customized robot-type advisor, a lending protocol, a yield farming tool, and a savings account. The system claims to take conventional mobile banking “into crypto with just 1-click.”

    The one-click is brought about by packaging complicated ideas into simple, actionable plans via automation.

    With Bella, DeFi users can comfortably conduct yield farming without having to jump between protocols. The network relies on complex arbitrage methods as the team behind believes they will see DeFi users grow tenfold.

    Bella and its co-founders have a deep connection with ARPA, a layer-two distributed system built on top of Ethereum. A part of its functions includes asset custody and inter-chain operability. Bella is meant to push ARPA’s vision forward by being at the core of the DeFi revolution.

    As such, Bella’s early supporters and users come from the ARPA community with a global presence. The community is spread across various social media platforms such as WeChat (over 40,000 people), Weibo (52K+ followers), Twitter (20K+ followers), Telegram (15K+ members), among others. ARPA is listed on Bithumb, Kucoin, Binance, Gate.io, Huobi Global, among other exchanges

    Bella Protocol key partners
    Bella Protocol key partners

    The project is backed by key partners such as Binance, Arrington XRP Capital, AlphaBit, and The Force Partners.

    Major Bella Tools

    Bella Lending

    Bella Lending supports tokens used in liquidity pools, carries a referral bonus, and powers yield farming and liquidity mining. Generally, it acts as a distributed and flexible money distribution point.

    Bella 1-click

    With a single click, the protocol brings DeFi features to a central point. Interestingly, it lowers gas fees to zero and acts as a smart portal.

    Bella Robot-like Advisor

    A robot is a program that takes large amounts of data and computes the most probable outcome. For Bella, a robot calculates the risks and provides a tailored exposure to stablecoins capable of bringing yields during farming, among other user-focused customizations.

    Bella Flex Savings

    Here, the system’s users are exposed to arbitrage strategies capable of earning the highest rewards in yield farming. Flex Savings accommodates multiple stablecoins and virtual currencies. However, these strategies are based on a user’s risk level. For instance, if a user stakes USDT, 40 percent can be used to farm yields on Compound (COMP), 40 percent on Curve Finance (CRV), and 20 percent distributed to newer protocols.

    Between Q4 2020 and Q3 2021, the network will see the launch of the 1-click protocol, Flex Savings, Lending tool, and conduct more user growth campaigns, as well as add other features.

    Bella Token ($BEL)

    The protocol uses a native currency, BEL, to tackle voting and governance issues. The token is designed using Ethereum’s ERC-20 standard.

    The token is used for fee collection, rewarding its holders, and staking. BEL has a hard cap of 100 million tokens. The tokens are distributed among the Binance Launchpool (5%), auction (2%), private sale (6%), ecosystem (18%), reserve (4%), user growth (40%), staking (10%), and the team (15%).

    Rewards for BEL stakers come from the management fee charged by the protocol for its products. Apart from staking, BEL tokens can be used to take interest instead of receiving rewards in the token invested. For instance, Flex Savings’ users who have deposited USDT and earned an interest of 1,000 USDT can opt to receive the interest in BEL for a bonus.

    Binance Launchpool

    Bella Protocol (BEL) is first project to be hosted on Binance Launchpool. Users will be able to stake their ARPA, Binance Coin (BNB), or Binance USD (BUSD) tokens into three separate pools to farm BEL tokens, starting from 20/09/09 0:00 AM (UTC) to 2020/10/09 0:00 AM (UTC). On 2020/09/16 6:00 AM (UTC), Binance will then list BEL and open trading for BEL/BTC, BEL/BNB, BEL/BUSD and BEL/USDT trading pairs.

    Bella Protocol will be on Binance Launchpool
    Bella Protocol will be on Binance Launchpool

    BEL Launchpool Details:

    Token Name: Bella Protocol (BEL)

    Private Sale Token Price: 1 BEL = 0.75 USD

    Launchpool token rewards: 5,000,000 BEL (5% of Total Token Supply)

    Total Token Supply: 100,000,000 BEL

    BEL staking period
    BEL staking period

    Supported Pools:

    Stake BNB: 4,500,000 BEL in rewards (90%)

    Stake BUSD: 450,000 BEL in rewards (9%)

    Stake ARPA: 50,000 BEL in rewards (1%)

    Users can go to Binance Savings page to stake their tokens. Just click on the BNB, BUSD or ARPA flexible savings products with a “Launchpool” label. (Diazepam) For more information, please refer here.

    Binance Savings Page
    Binance Savings Page

    How to calculate the amount of BEL tokens you will get?

    Staked BNB, BUSD and ARPA balances will be recorded each hour for 30 days after the staking period begins to get an average daily staking balance for each day. Rewards allocated to each pool will be split evenly every day over the 30 day period.

    Calculation for BNB pool stakers:

     5,000,000 x 90% / 30 = 150,000 BEL tokens per day

    Each participant’s rewards will then be calculated every day based on their ratio of BNB staked compared to all BNB staked in each pool.

    Example:

    User A: Stakes 5,000 BNB for 12 hours on thefirst day

    Average amount of BNB for all users (across 24 hours): 100,000BNB

    Calculation: ((5,000 x 12 / 24 ) / 100,000) x 150,000 = 3,750 BEL tokens

    Conclusion

    The DeFi scene continues to witness increased activity from users and developers alike even if the adoption rate is quite slow.

    For traditional investors to join the space, there needs to be a clear and robust connection between DeFi and CeFi. One way to bring this connection is through products like Bella that bring a familiar offering to those rooted in conventional financial methods.

    Bella’s mobile-friendly products, such as tools for yield farming, lending, savings, and a customized risk assessment Robo-advisor, are the key to driving the mass adoption of DeFi. Furthermore, a smooth user experience, as well as the utility and incentivization of BEL tokens also adds value to the protocol, which in turn, helps speed up adoption.

    Decentralised Finance (DeFi) series: tutorials, guides and more

    With content for both beginners and more advanced users, check out our YouTube DeFi series containing tutorials on the ESSENTIAL TOOLS you need for trading in the DeFi space e.g. MetaMask and Uniswap. As well as a deep dive into popular DeFi topics such as decentralized exchanges, borrowing-lending platforms and NFT marketplaces

    The DeFi series on this website also covers topics not explored on YouTube. For an introduction on what is DeFi, check out Decentralized Finance (DeFi) Overview: A guide to the HOTTEST trend in cryptocurrency

    Tutorials and guides for the ESSENTIAL DEFI TOOLS:

    More videos and articles are coming soon as part of our DeFi series, so be sure to SUBSCRIBE to our Youtube channel so you can be notified as soon as they come out!

    Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.

  • OIN Finance ($OIN): DeFi’s first foray into Ontology

    OIN Finance ($OIN): DeFi’s first foray into Ontology

    OIN Finance ($OIN) devised a way to build a Decentralised Finance (DeFi) project that seeks to deliver what most Ethereum products can too, but on a different blockchain — the Ontology network. This can potentially solve issues of blockchain congestion and rising gas fees which recently is a cause for concern and a real obstacle to mass adoption.

    As the first DeFi project running on Ontology, it is interesting to know what they have done and what they have in store in the space in the months to come.

    Check out our explainer video on OIN Finance:

    Background

    Renard Zhang, CEO of OIN Finance and his team began the project with a three-pronged mission of promoting DeFi, becoming a gateway for DeFi, and helping it grow into a more mature market. The team helped recreate the developments of the decentralized technology from the Ethereum ecosystem into the Ontology blockchain.

    What is OIN Finance?

    OIN Finance is a DeFi ecosystem focused on providing a liquidity pool lending platform on top of the Ontology network. Its purpose is to create a cross-chain interoperable platform for services like lending, borrowing, swapping, and minting of stablecoins.

    With OIN, users can add liquidity on their own decentralized exchanges (DEX) and build their own market makers through OINSwap. Another project inside the OIN ecosystem is OINLend, where users can make loans or borrow cryptocurrency assets.

    Other services available in the ecosystem are OINWallet, OINDAO, and the USDO stablecoin. Through OIN’s bridge technology, these services built on the platform can be accessible to the Ethereum community, as well.

    For now, OIN is focusing on building the Ontology network to provide low-cost services while avoiding the congestion problems that users experience in the Ethereum blockchain, more so recently. Once the project has a strong enough user base on the ONT DeFi platform, they can move to scale the project further.

    The road ahead for OIN is to first build a community of early adopters and give them an opportunity to be a part of the initial pool of stakers. Then, it can be made available to the larger public.

    Cross-chain interoperability

    OIN’s architecture enables the growth of not only its own platform but also the whole DeFi space, by linking several blockchains together. Its cross-chain design opens up the platform to other existing networks to expand offerings to a vast number of users.

    Decentralization

    By adopting Tendermint’s consensus algorithm, nodes can function without any problem whilst trying to achieve consensus. And through its own stablecoin, there are enough incentives for nodes to continue securing and maintaining the health of the network.

    Data Security

    OIN uses Merkle proof to secure the data of its users. In such a set-up, any information on actions initiated on top of the Ethereum blockchain will be kept in a secure line of codes so they cannot be written back to.

    OIN Finance’s Services

    OINSwap V1 Pool

    OIN will launch the first DEX on Ontology, enabling Ontology users to conveniently trade their ONT tokens with the tokens supported by OIN. The swap pool powers the whole DEX while its prices are determined by prevailing market conditions. V1 and V2 pools are currently in the works and there is no official launch date yet.

    OIN swap v1 pool
    OIN swap v1 pool

    OINSwap V2 Pool

    As soon as the cross-chain bridge is successful, and ERC-20 assets can run to and from the Ontology network, they can begin the operation of OIN Swap’s V2 pool. In here, OIN tokens are used to reflect the value of some tokens into OIN Swap.

    OIN Swap v2 pool

    OIN Wallet

    OIN Wallet can be used to store tokens supported by the Ontology and Ethereum network. As soon as the second phase of the project is completed, which is to successfully run the Ontology-Ethereum bridge, OIN wallet can be able to access other Ethereum-based DeFi projects. These are protocols such as Curve, Balancer, or Compound.

    OIN wallet
    OIN wallet

    USDO

    USDO is the stablecoin of the network, pegged to the US Dollar. It is the first decentralized stable token built on top of Ontology. USDO is backed by Ontology’s native token, ONT.

    The stablecoin can be used to deposit into OIN Swap or OIN Lend pool to gain profits from staking and liquidity mining.

    $OIN Token

    OIN token is the native asset of OIN Finance. It will be utilized as the governance token, as well as for collateral rewards and clearing compensation.

    Through OIN token, the platform implements a community governance model to manage operations. Elaborately, the token can be used to pay for transaction fees, staking, or community voting.

    OIN token is hugely popular. The public sale of the token was around 50 times oversubscribed and was launched on Uniswap and Bitmax and BiBox on 3rd September 2020. Those lucky few that were able to get into the public sale, purchased their OIN tokens at USD$0.08, and considering prices of OIN at the time of writing is almost USD$1, these holders have every reason to be ecstatic.

    OIN DAO

    OIN DAO also has the ability to issue USDO. Since USDO is collateralized by ONT, it has its own pool in the Ontology platform. Those who have ONT can mint USDO at an initial collateralization rate of 300%.

    The clearing mechanism (similar to how liquidations work in MakerDAO) kicks in if the collateralization of the USDO drops below 180%. But if users do not wish to borrow or lend USDO, they can send them over to OIN Swap or OIN Lend to do liquidity mining.

    OIN Lend

    Lending is decentralized on the OIN platform. Through smart contracts, both lenders and borrowers can safely deposit tokens to become underlying assets on the platform. Then, OIN chooses between different tokens supported by the Ethereum and Ontology network to mint OIN tokens at a specific exchange rate.

    A minimum over-collateralization of 150% is required for loans, similar to other DeFi lending protocols. The interest fees are determined automatically by smart contracts based on different market factors such as supply and demand.

    Interests are accumulated per block and a portion of it is kept in the reserves. This is to allow lenders the option of withdrawing their token deposits should they wish to do so.

    OIN Chain

    OIN Chain is a layer built on top of the OIN platform designed to support the cross-chain interoperability feature of the protocol. This will help integrate Ethereum’s DeFi projects to also supply more assets in the Ontology network. (nelsongreerpainting)

    It will be a multi-functional adaptor that will bridge both Ethereum and Ontology, as well as more public chains in other developments ahead.

    Liquidity Mining and Staking

    Half of all the OIN token supply is generated from liquidity mining and staking. The supply created via stakers will be derived from USDO collateral pools collected in the OIN DAO and OIN Lend platforms.

    OIN tokens that are created by way of liquidity mining will be injected in the OIN Swap pools. Once the OIN Lend pool is made available with its cross-chain architecture in place, ERC-20 compliant tokens can be staked too.

    Exactly 40% of all minted tokens are distributed every day via staking rewards, while the remaining 60% will be distributed as liquidity mining rewards. Through OIN DAO, the community can decide how to shift the ratio of the daily reward allocation for the network.

    Conclusion

    As one of the pioneers of DeFi on the Ontology network, the outlook for OIN Finance appears increasingly positive, especially with Ethereum’s rising gas fees. While the number of DeFi projects launched on the Ethereum blockchain increases daily, whether they can continue to sustain their operations continues to be a prevailing concern.

    Establishing a successful proof of concept on top of other platforms for DeFi projects can be helpful for the community and whole crypto space at large. After all, it only adds more options for users to explore the services that fit their needs best.

    Decentralised Finance (DeFi) series: tutorials, guides and more

    With content for both beginners and more advanced users, check out our YouTube DeFi series containing tutorials on the ESSENTIAL TOOLS you need for trading in the DeFi space e.g. MetaMask and Uniswap. As well as a deep dive into popular DeFi topics such as decentralized exchanges, borrowing-lending platforms and NFT marketplaces

    The DeFi series on this website also covers topics not explored on YouTube. For an introduction on what is DeFi, check out Decentralized Finance (DeFi) Overview: A guide to the HOTTEST trend in cryptocurrency

    Tutorials and guides for the ESSENTIAL DEFI TOOLS:

    More videos and articles are coming soon as part of our DeFi series, so be sure to SUBSCRIBE to our Youtube channel so you can be notified as soon as they come out!

    Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.

  • What is AAVE ($LEND)?

    What is AAVE ($LEND)?

    Aave Protocol with their native token $LEND is a leading company within the decentralized finance (DeFi) sphere. The Company allows its users access to its open-source and non-custodial protocol to create money markets, joining a growing list of projects like Compound to bring decentralized options to the masses. We look at who is Aave ($LEND), its uses and how it differs from other projects such as Compound Finance.

    What is Aave?

    Named after the Finnish word for “ghost”, London-based company Aave was set up in September 2018 after a successful initial coin offering (ICO) the previous year for its ETHLend token which raised USD$16.2 million. The executive team under ETHLend migrated to Aave upon its establishment with ETHLend becoming a subsidiary of Aave. In January 2020, ETHLend announced it was no longer in operation and its website would only remain active for current users to close down their existing loans.

    Aave’s aim is to fill in the gaps left by centralised fintech industry giants like PayPal, Skrill and Coinbase. Their main product is Aave Protocol, an open source and non-custodial protocol for creating money markets on the Ethereum blockchain.

    Who is the team behind Aave?

    Aave has a wealth of talent and experience within its team. Stani Kulechov (CEO) and Jordan Lazaro Gustave (COO) have retained and migrated their roles from ETHLend, bringing their wealth of knowledge to Aave. Their diverse 18 man team bring together a wealth of experience in the startup scene.

    What is Aave Protocol?

    Aave’s biggest and most integral aspect is Aave Protocol which was launched in January 2020. Its shift from ETHLend marked a significant shift in strategy for the Company. Going from decentralized P2P lending to a pool-based strategy, Aave Protocol is an open source an non-custodial protocol that allows users to create their own decentralized money markets on the Ethereum blockchain.

    Aave Protocol
    Aave Protocol

    Depositors provide liquidity by depositing cryptocurrencies into lending pools which will then allow them to earn interest. Meanwhile, borrowers can obtain loans by tapping into these lending pools in either an overcollateralized or undercollateralized way. The loans do not need to be individually matched i.e. one lender to one borrower. Instead, deposits into the pool and the amounts borrowed/ collateral are used to make instant loans based on the pool’s state. There are currently 2 money markets that users can enter into, these are Aave and Uniswap.

    Aave markets
    Aave markets

    Flash Loans

    Aave has one feature that sets it apart from the rest. Flash loans allow customers or to take out loans without any collateral. These flash loans enable a customised smart contract to borrow assets from Aave’s reserve pools within one transaction. The loan is made on the condition that the liquidity is returned to the pool before the transaction ends. However, if it’s not repaid by that time, the transaction gets reversed- which will effectively undo any actions executed until that point and guarantee the safety of the funds in the reserve pool.

    The Fast Loan feature is designed for developers to make tools that require capital for arbitrage, refinancing, or liquidating purposes. Aave explained Flash Loans saying it is “designed for developers/people with some technical knowledge”, with the benefit of risk-free loans. Aave charges a 0.09% fee on flash loans.

    Rate Switching

    Rate switching is another unique selling point for Aave, which arrived during the May upgrade of their borrowing/interest rates. Rate switching allows borrowers to switch between fixed and floating interest rates, something useful in a volatile decentralized market. For high-interest rates, users will usually opt for the fixed-rate but when it is more volatile and expected to be lower, one might go for the floating option to reduce borrowing costs. The fixed-rate can change but only when the deposit earning rate increases above the fixed borrow rate as the system could get unstable by paying out more than its being paid. If so, the fixed rate is rebalanced to the new stable rate. On the other hand, when the variable rate is lower than the fixed-rate by 20%, the loan will automatically decrease to account for the difference.

    Which Cryptocurrency Tokens are linked?

    There are 19 tokens available on Aave. These include DAI, USD Coin (USDC), TrueUSD (TUSD), USDT Coin (USDT), sUSD, Binance USD (BUSD), Ethereum (ETH), Basic Attention Token (BAT), Kyber Network (KNC), ChainLink (LINK), Decentraland (MANA), Maker (MKR), Augur (REP), SNK, Enjin Coin (ENJ), REN, WBTC Coin (WBTC), Yearn.finance (YFI) and Ox Coin (ZRX).

    Please note: Each asset has a different collateral requirement. This is because of the differences in price volatility. Stablecoins naturally give loan-to-value ratios, due to their price stability. A full breakdown of Aave’s grading process can be found in their Risk Framework.

    Alongside these tokens, there is also a native token that Aave uses and which is called Lend. An explanation and analysis of the token can be found below.

    LEND ($LEND) Token

    Often referred too as ETHLend, the LEND cryptocurrency token has rolled over to become the native token of Aave following the winding-up of operations by ETHLend in January this year. Although it has kept the name, the new Aave version of Lend is largely different from the previous one.

    LEND token metrics
    LEND token metrics

    Binance Key metrics on Lend

    Built based on the ERC-20 standard, $LEND tokens can be used for fee reductions. The tokens are burnt from the fees collected from the Aave Protocol, with around 80% of platform fees used. This appears to suggest that Lend tokens will be worth more over time. LEND owners can also claim on protocol fees in exchange for acting as the first line of defense in the case of liquidity events by malicious borrowers.

    In addition, $LEND tokens can be used for voting on Aave Improvement Proposals (AIPs). What’s more, LEND holders can vote with their LEND deposited on the Aave platform, even if it is currently being used as collateral. Currently, this feature is pre-launched on the Ropsten test network before it is launched on the Ethereum mainnet. This is so the Aave community can vote on proposals without incurring huge gas costs, try out the module and provide feedback to the Aave team before it is formally launched. It is also worth noting that the outcomes of all votes on the testnet are not considered as valid for the long term.

    Voting on Aave
    Voting on Aave

    How to lend on Aave

    Depositing and earning interest on Aave is a simple process. Before you start, you must visit https://app.aave.com/ and connect using a web 3.0 wallet such as Metamask, Coinbase Wallet or Fortmatic.

    Depositing is easy, just simply pick your desired asset in which to invest and then allow Aave access to the asset. Once the transaction is processed, and the interest rate is confirmed you can check the rate changes on the Aave app. The interest-earning tokens are called aTokens which are similar to Compound’s C tokens.

    Interest generating tokens

    There are some differences between Compound’s tokens and the aToken. The main one being that the aToken’s keep their underlying assets price and will increase the amount of owned tokens when the price goes up rather than increasing the tokens price.

    Aave vs Compound ($COMP)

    Both Compound Finance and Aave appear to be the two top DeFi lending platforms. However, both have unique features that set them apart. Compound does have USDT as a usable asset, but Aave has a wider range of tokens on offer. For Aave, their new interest rates and regulations, like rate switching gives them a slight edge. For first time users, Aave offers great incentive rates. However, lending rates and Borrow fees are higher on average with Aave. Either way though, Aave has proven a good addition to the Defi community and should prove popular. You can read more about Compound ($COMP) here.

    Key features of Aave 2.0

    Aave 2.0 was announced on 14th August 2020. Aave Market now offers 19 assets, plus the Uniswap Market offers different Uniswap pairs as collateral. The platform has also grown to over 15,000 users. Here are some of the key new features which can be expected in Phase 2 of Aave.

    Pay with collateral

    Currently, if users want to repay their loan with part of their collateral they need to do 4 separate transactions on several protocols: withdraw the collateral, buy the cryptocurrency which is borrowed, repay the debt and unlock all the deposited collateral. With this new function, Aave users can deleverage or close their positions by directly paying with collateral in 1 transaction.

    Debt tokenization and native credit delegation

    Users’ debt positions will be tokens i.e. users will receive tokens which represent their debt. This enables native credit delegation within the Aave Protocol, in addition to other features such as native position management from cold wallets and user-specific yield farming strategies.

    Fixed rate deposit

    Deposits on Aave can generate predictable interest rates which are not bound by market variations.

    Improved Stable Borrow Rate

    This will further ensure the predictability of interest rates by locking down their borrow interest rate to a specified time period.

    Private markets

    Aave will allow governance to open private markets to open private markets to support all types of tokenized assets. The Aave team are also working on a collaboration with RealT which will bring mortgages onto Ethereum.

    Improved aTokens

    aTokens are Aave’s interest bearing tokens which are minted when a deposit is made and subsequently burned when redeemed. The aToken is pegged 1:1 to the value of the underlying asset deposited with Aave. In Aave 2.0, there will now be a version 2 of the aToken which integrates the EIP 2612 which allows for gasless approvals.

    Gas Optimizations

    This feature is currently in the works and will lead to a significant drop in transaction costs for most of the interactions on Aave. For some interactions the gas cost may even be reduced by 50%. Aave version 2 will also implement native GasToken Support.

    Security

    In version 2, the internal design has been made simpler, the architecture is also improved so it is more formal verification friendly. Aave is also working with top auditors such as Consensys Diligence and Certora- a leading company in automatic verification technologies.

    Native trading functionalities

    Aave v2 will introduce the ability for users to natively trade their debt position from one asset to another, i.e. you can borrow DAI, and if USDC becomes cheaper to borrow, you could change your debt position to USDC in one transaction.

    Users can also trade their deposited assets across the various cryptocurrencies supported by Aave, even when it is being used as collateral.

    Margin trading is also introduced in version 2, so users can directly take long and short leveraged positions without using third party services. Conversely with margin lending, liquidity providers can increase the weight of their deposits to take opportunities.

    Governance

    Aave version 2 also introduces several new governance features. Now, AAVE token holders can delegate their voting weight to any other address. Aave believes this may lead to the emergence of Protocol Politicians, who will represent the interests of their peers to delegated their votes to them. But unlike most representative democracies we see around the world today, vote delegation is a liquid democracy so this means a user can instantly remove the delegation in a single transaction if they so wish.

    The Aave team also recognises the pain points of the need to move tokens to another location to participate in governance. So Aave now allows users to be able to sign messages from their cold wallet to participate in Aave Governance. This will in turn reduce the security risk.

    References:

    AsiaCryptoToday: https://www.asiacryptotoday.com/aave/

    Decentralised Finance (DeFi) series: tutorials, guides and more

    With content for both beginners and more advanced users, check out our YouTube DeFi series containing tutorials on the ESSENTIAL TOOLS you need for trading in the DeFi space e.g. MetaMask and Uniswap. As well as a deep dive into popular DeFi topics such as decentralized exchanges, borrowing-lending platforms and NFT marketplaces

    The DeFi series on this website also covers topics not explored on YouTube. For an introduction on what is DeFi, check out Decentralized Finance (DeFi) Overview: A guide to the HOTTEST trend in cryptocurrency

    Tutorials and guides for the ESSENTIAL DEFI TOOLS:

    More videos and articles are coming soon as part of our DeFi series, so be sure to SUBSCRIBE to our Youtube channel so you can be notified as soon as they come out!

    Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.

  • Kusama ($KSM): How is it Polkadot’s wild cousin?

    Kusama ($KSM): How is it Polkadot’s wild cousin?

    Kusama ($KSM) calls itself “Polkadot’s wild cousin”. Yet, is an initiative that seeks to solve the Polkadot ecosystem’s concerns of coding vulnerabilities. Going beyond the usual testnet, Kusama deployed on its platform a network focused on research and development with real costs to its community and developers. This makes it more mainnet-like, without having to actually put new developments up on the main Polkadot platform.

    Background

    Dr. Gavin Wood founded Kusama with a goal of supporting the Polkadot ($DOT) network via building a parallel blockchain that allows experimentation and development with very realistic conditions. With that in mind, Dr. Wood thought of having a “canary network” that functions as a warning and early problem detection protocol that can reveal the weaknesses of the Polkadot code base.

    With Kusama, new features that are planned for implementation on the main Polkadot chain can be tested. The difference between Kusama and all other testnets is that the decisions made in the platform have actual economic implications. Testnets only provide playground tokens that bear no actual value.

    What is Kusama?

    Kusama is Polkadot’s canary network, which means that it is an experimental community research and development protocol. Its main purpose is to help developers test and deploy parachains on the Polkadot project, or experiment on its governance and staking functions with real economic conditions.

    Canary testing
    Canary testing

    Canary testing is important as the developers behind both chains hypothesize that it is the best way to completely understand the critical risks that lie in Polkadot’s development.

    As an unrefined version of Polkadot, Kusama functions as an independent decentralized main network. It will continually function as long as the community allows it to since decentralized systems inherently have no kill-switches. It could possibly become a para relay chain to Polkadot, however, it is never intended to merge with Polkadot’s chain itself.

    Kusama Token ($KSM)

    Kusama’s native token is the KSM, which holders can use to stake, become a validator or nominate one, and vote on its governance mechanism, among others. Furthermore, it is the token that powers most of the mechanisms in the Kusama network.

    Investors who purchased DOT during Polkadot’s ICO are qualified to receive an equivalent amount of KSM on the Kusama Network.

    Consensus Protocol: Nominated Proof-of-Stake

    Kusama follows the Nominated Proof-of-Stake (NPoS) consensus model where validators are elected based on their stakes and the stakes of those who are voting for them. As much as possible, the platform balances the weight between validators every election.

    In Polkadot, the election of validators focuses on the balance between these three metrics (Phragmen’s algorithm):

    • The total amount staked by the nominee and their nominators
    • The stake behind the minimally staked validator
    • The variance of the stake in a set.

    Validators

    To become a validator, users are required to stake KSM first. Once users already have the minimum amount of tokens needed to become candidates for a validator set, they are elected based on the Phragmen’s algorithm.

    There are currently over 130 validators on Kusama.

    Parachains

    Parachains are application-specific data structures secured by validators on the Polkadot Relay Chain and run in parallel with the Polkadot network. This allows them to process transactions with the speed and scalability of the Polkadot blockchain.

    How parachains work
    How parachains work

    Collators, on the other hand, are tasked to maintain the whole parachain. Collator nodes keep every data concerning the parachain and create new block candidates for the verification and recording of validators.

    Parachains can have an independent economy from the Polkadot network and their own native token.

    Governance

    Before every protocol update or revision is made, they are voted upon by the network composed of token holders and Kusama’s council. Through innovations such as on-chain voting systems and stake-weighted decision making, Kusama has enabled a community-driven governance model.

    The governance function follows the following procedures:

    Proposing Referenda: Each referendum contains a specific proposal that serves as a privileged function call. Included in the referenda is the period designated for the voting process. They can be submitted by Polkadot (DOT) token holders and the council, or taken from prior referenda or recommendations by Kusama’s Technical Committee after the approval of its Council.

    Voting for a proposal: There are only two options when voting, either “aye” or “nay.” If proposals receive a majority, they can be carried out for implementation. Before the enactment of a proposal, however, users are required to lock their tokens until the whole enactment delay has lapsed. The purpose of this parameter is to ensure that a proposal has met the minimum economic buy-in and discourage vote selling.

    Tallying: There are three scenarios whenever the network votes on specific proposals. Since each proposal is distinguished on whether they are from the public or the council, the votes also differ in bias.

    Kusama vote tally
    Kusama vote tally

    For every proposal, the number of “aye” and “nay” votes are accounted for as the turnout, or the total number of voting tokens, are factored in.

    In a positive turnout bias (if the voter turnout is low), more votes in favor of the proposal are required. In a negative turnout bias, it requires more votes against the proposal. And for Council proposals, only a simple majority is necessary.

    Kusama Council

    While there are active stakers, there are also passive stakeholders in the Polkadot and Kusama ecosystem. Through an on-chain entity comprising of 17 seats, the Council decides on three main tasks of governance. These include proposals of referenda, striking out clearly dangerous referenda, and electing members of the network’s technical committee.

    Kusama council
    Kusama council

    Community on Kusama

    Kusama has deployed the Society module, an economic game that seeks to reward users for participating and maintaining a membership society. Rewards, however, are given maturity periods. This means that the user cannot instantly get their incentives until the maturity period of their entitlements has already lapsed.

    Societies can punish members by slashing their incentives if they are not being collected. There are many other violations, such as not participating in voting calls, among others.

    By a strike system, members who have committed a number of punishable actions exceeding the limits decided upon can be booted out of the society.

    As of now, Kusama only has one society organized on top of its platform. In the future upgrades though, they might add more.

    Conclusion

    The growth of the DeFi space is dependent on the participation of both its developers and the community behind them. Projects that empower developers to test out new features before they are actually implemented on main channels are important, especially if the security and reliability of a particular network are at stake.

    A project like Kusama enables developers and their community to play around the Polkadot platform while making sure that each feature they are planning to deploy is not only audited but also tested realistically.

    Decentralised Finance (DeFi) series: tutorials, guides and more

    With content for both beginners and more advanced users, check out our YouTube DeFi series containing tutorials on the ESSENTIAL TOOLS you need for trading in the DeFi space e.g. MetaMask and Uniswap. As well as a deep dive into popular DeFi topics such as decentralized exchanges, borrowing-lending platforms and NFT marketplaces

    The DeFi series on this website also covers topics not explored on YouTube. For an introduction on what is DeFi, check out Decentralized Finance (DeFi) Overview: A guide to the HOTTEST trend in cryptocurrency

    Tutorials and guides for the ESSENTIAL DEFI TOOLS:

    More videos and articles are coming soon as part of our DeFi series, so be sure to SUBSCRIBE to our Youtube channel so you can be notified as soon as they come out!

    Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.

  • Trustswap ($SWAP) Explained – Next generation of DeFi Transactions

    Trustswap ($SWAP) Explained – Next generation of DeFi Transactions

    Trustswap is the next evolution of Decentralized Finance (DeFi) transactions solving major problems with subscriptions, split payments, and cross-chain token swaps. A cross-chain “smart swap” system is used to wrap any token or coin (Bitcoin, Litecoin, Monero, Ripple, Cardano) into an ERC20. A trustless decentralized escrow service at the core of Trustswap provides an easy way to split payments into timed batches. The project provides an easy way for developers to accept payments for annual subscriptions where both parties can trust that payments are completed in a timely manner. This technology is essential for the investment space as token distributions are split into tranches. Trustswap conducted an Initial Liquidity Offering for the SWAP token in June 2020.

    Trustless escrow and split payments

    Two party swaps on Trustswap

    The initial application of the Trust Swap is within the ICO & cryptocurrency investment space where token distribution needs to be split into tranches. Trust swap does this automatically, cutting out the need for lawyers and contract underwriters to complete the transactions. This means that instead of trusting expensive third parties, VC and projects and directly complete their transactions on the blockchain.

    Decentralized Subscription and payment model

    Trustswap is implementing a “Two-party time-release payment” geared towards subscription payments and consumer transactions. The current industry trend for services is transitioning towards a monthly subscription model (such as Adobe Creative Cloud, Spotify, Apple TV). Currently, cryptocurrency transactions are single payment – a model that doesn’t suite service-based networks very well. Trustswap will allow an easy method for developers to add support for accepting annual subscriptions – improving how cryptocurrencies can be spent and used.

    Cross-chain and multi-currency support

    TrustSwap supports a multi-currency future with the ability to customize payment services in a wide range of cryptocurrencies and tokens. Trustswap will be able to wrap different cryptocurrencies such as Bitcoin, Ethereum, Monero, Vechain, and other different cryptocurrencies to trade. This will make it easy for different communities to collaborate with each other and complete payments.

    Founders and Team

    Trustswap Team

    Jeff Kirdeikis (CEO): Jeff is the Founder and CEO of Uptrennd, the world’s most engaged blockchain-based social media platform. He is the host of The Bitcoin and Crypto Podcast and runs the world’s most engaged FB crypto group.

    Adam Barlam (CTO): Adam is the dev and founder behind the projects Bravocoin, a platform that allows users to earn crypto for writing reviews and Rebuzz, a decentralized social network. He has previously worked as a Sr. Architect at Godaddy and Intel.

    Advisors

    Michael Gu – Boxmining Founder is currently a strategic advisor for Trustswap. Michael is the Founder of Boxmining – one of the top crypto YouTube channels with over 200,000 subscribers and 15 Million Views. Michael has been providing top tier independent coverage of the cryptocurrency scene. Micheal has participated in the first wave of cryptocurrency investing, with a mining operation in 2012 and key investments in 2017.

    Ivan Liljeqvist – is a Swedish blockchain influencer and developer based in Stockholm. He is known for his YouTube channel, Ivan on Tech.

    Mauvis Ledford – Mauvis is the former CTO at Coinmarketcap, as well as the former Technology and Research Consultant at the Bill and Melinda Gates Foundation. He currently serves as an advisor at the first full-service blockchain accelerator, MouseBelt.

    References:

    Altcoins to Watch – AltcoinBuzz

    FAQ:

    Where can I buy / trade trustswap?

    Trustswap can be directly traded using the Uniswap Exchange. This decentralized exchange has the most liquidity for SWAP tokens. On top of this, SWAP can be traded on exchanges such as MXC and Biki

    When will Trustswap Launch

    Trustswap is expected to complete an initial testnet in August 2020 with a full mainnet launch later in the month. Additional features such as Cross-chain integration, tokenized assets and event-released payments are expected in the future.

    Which cryptocurrencies will be supported by Trustswap

    Trustswap’s goal is to support a wide network of different cryptocurrencies, including coins that are not on Ethereum. This will be done through a process called “Wrapping”, a method of creating cross-chain assets that can be traded on Ethereum as ERC-20 tokens

    Where can I find the Price of SWAP

    SWAP is listed on CoinGecko.

    What was the ICO price of SWAP

    SWAP was sold via an Initial Liquidity Offering.

    I don’t see SWAP on Metamask, I can’t find it

    You need to add the $SWAP token manually on metamask using the “Add token feature”. Enter the official contract address of swap: 0xcc4304a31d09258b0029ea7fe63d032f52e44efe

    Decentralised Finance (DeFi) series: tutorials, guides and more

    With content for both beginners and more advanced users, check out our YouTube DeFi series containing tutorials on the ESSENTIAL TOOLS you need for trading in the DeFi space e.g. MetaMask and Uniswap. As well as a deep dive into popular DeFi topics such as decentralized exchanges, borrowing-lending platforms and NFT marketplaces

    The DeFi series on this website also covers topics not explored on YouTube. For an introduction on what is DeFi, check out Decentralized Finance (DeFi) Overview: A guide to the HOTTEST trend in cryptocurrency

    Tutorials and guides for the ESSENTIAL DEFI TOOLS:

    More videos and articles are coming soon as part of our DeFi series, so be sure to SUBSCRIBE to our Youtube channel so you can be notified as soon as they come out!

    Disclaimer: This article is written using publicly available information by our writer David Lancaster. Our Founder is currently a strategic advisor for Trustswap. Writers and staff have cryptocurrencies holdings mentioned in articles on this site.

    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.

    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.

  • Curve Finance ($CRV) guide

    Curve Finance ($CRV) guide

    Curve Finance is a decentralized exchange (DEX) for trading stablecoins. As with every other Decentralised Finance (DeFi) project, Curve Finance has its own token known as Curve DAO token ($CRV). The Curve Finance DEX has already been up and running since January 2020, and yield farmers have already been making gains off of it. However, it was the abrupt listing of the $CRV token on 14th August 2020 that really turned heads in the cryptocurrency space, and not necessarily in a good way. In this article, we take a look at the background and features of Curve Finance and the controversial launch of its $CRV token.

    To learn more about Curve Finance and specifically $CRV yield farming and how to see if YOU may have any $CRV, check out our latest video:

    Curve Finance ($CRV) Yield Farming

    Background

    Michael Egorov CEO of Curve Finance, also worked with the NuCypher team as Co-founder and CTO for five years. Egorov has served Curve through his expertise in software development, thanks to his managerial stints at different tech companies in the past.

    The team behind Curve Finance officially began working on the exchange back in December 2019, and they launched it in January 2020. Even then, Curve was already being used by several arbitrage traders, but its popularity shot up after it recently (and surprisingly) launched its governance token this August 2020.

    Interestingly, it appears that even after the launch of the CRV token, some members of the Curve team did not know that it was already out. It was so abrupt that the team had to adopt it after having no option but to just review its codes following the deployment.

    What is Curve Finance?

    Curve is a decentralized exchange liquidity pool built to support the efficient trading of stablecoins. At present, Curve supports BTC pairs, as well as DAI, BUSD, sUSD, TUSD, USDC, and USDT.

    And through the help of AMMs (automated market makers), Curve makes low slippage trades possible while keeping transaction fees low. Most arbitrage traders prefer Curve compared with other liquidity pools like Uniswap simply because of the savings in trades.

    With only a few months in existence, the platform has already beaten other exchanges in terms of trading volume. With Uniswap at the top of the ranks, Curve performed stronger than projects such as Aave, Compound Finance and Balancer.

    What sets Curve apart from other DEXs?

    The problem with DEXs like Uniswap is the cost that users incur for token trades. If you look at other DEXs, they can’t facilitate direct token trades. In Uniswap’s case, for example, stablecoins still have to be traded for ETH, before they are traded with the stablecoin that the user wishes to get (Uniswap V2 might have already eliminated this drawback). Given that the transaction involves two trades, the transaction fees are also doubled for every user.

    Curve functions differently. The platform’s liquidity pool allows direct token trades among listed pairs. With a direct swap function, users save more by paying lower trading fees. And as of now, the fees are still set at 0.04% per transaction. This means that users have the opportunity to execute more efficient trades without having to pay much in fees for every transaction.

    The algorithms for both DEXs are also different. Uniswap focuses on maximizing available liquidity, but Curve’s algorithm puts more importance in minimizing slippage. Because of this, high frequency and large volume traders save more by using Curve.

    Compared with the order book systems, Curve uses an AMM model that maximizes on-chain liquidity pools to provide the necessary funding even before trades are executed.

    Making Money Providing Liquidity in Curve

    On-chain liquidity pools refer to funds held in exchanges to facilitate trades. With Curve, users can freely deposit any supported token in the pool and become a liquidity provider. This is what we mean when we talk about funding specific pools for Curve’s trading pairs.

    And in turn, liquidity providers earn fees from the swaps that are performed in the exchange.

    Thanks to Curve’s composability, its liquidity pool is also accessible to many other protocols. In fact, the platform experienced increased trading volume after the introduction of liquidity mining from yEarn.

    yCRV

    In liquidity mining, miners help run an exchange’s market-making bot to help it run its trades. This trend enticed miners to provide additional liquidity in yEarn’s yCRV token because it appeared to be quite profitable.

    The yCRV token is a wrapped token composed of Curve’s supported trading pairs and represents its liquidity pool. Additionally, since Curve’s liquidity pool is available to other protocols such as Compound, liquidity providers also earn additional income from their interest fees.

    While supplying liquidity in Curve’s pool appears profitable, it also entails some risks. These are some of the uncertainties that Curve’s liquidity providers are likely to face.

    DeFi Ecosystem Vulnerability

    Since Curve is already integrated with some other DeFi platforms, users have to be able to monitor ongoing issues on these other protocols. Looking after security issues in other projects will ensure that liquidity providers are well-knowledgeable about the risks of depositing their assets in Curve’s pools.


    Yield Volatility

    Curve’s yields fluctuate a lot. Although high yield pools entice users to provide liquidity over time, it also ultimately becomes low or medium yield pools over time.

    To combat this, users can opt to supply liquidity to all Curve pool, a diversification strategy. And this would give out the average yield of all pools. Unfortunately, it also raises slippage and gas fees, as well as exposure to smart contract vulnerability.

    Calculating Profits after Gas and Fees

    One hurdle with supplying liquidity on the Curve protocol is calculating your profits after gas and slippage fees are deducted.

    The platform splits liquidity across various pools and is linked to external protocols. As a result, gas fees are relatively high. And depending on tokens you supply, you may encounter significant slippage as well.

    This makes it rather difficult to do yield-hunting — the chasing of high yields by changing of pools. It is recommended that liquidity providers deposit tokens to pools for long enough periods in order to make a profit after slippage and gas fees are paid.

    $CRV Token

    $CRV is Curve’s native token, it is generated when you deposit and stake cryptocurrencies on the platform. It is awarded to liquidity providers proportional to their share from the yield which their pools make. And since CRV has just been released, those who have contributed to Curve’s liquidity pool will receive a prorated amount of it.

    With Curve’s transition to become a DAO, CRV tokens also represent the holders’ rights to take part in its governance mechanism, so they can make proposals and vote on them. And with CRV, governance will follow a ‘time-weighted’ voting system. It simply means that the longer they hold CRVs, the greater their voting power in the DAO becomes.

    What yield-farmers also do is to take advantage of the popularity of DeFi to speculate on tokens such as $CRV. So what they would do is after depositing and earning the $CRV token, they would sell $CRV on the market for profit.

    What happened with the $CRV token launch?

    Prior to the launch, $CRV was one of the most anticipated and talked about tokens, and the team saying it would launch in “early August 2020”. On 14th August 2020, the $CRV token was suddenly launched by an anonymous developer without anyone, including the Curve Finance team knowing. The developer was able to do this because the code of the $CRV token and DAO was available on GitHub, so all the developer had to do was to put the two together and launch the smart contract.

    Of course after the initial launch of the token other cryptocurrency enthusiasts started posting on Twitter about the news. This meant the Curve team had to go around clarifying the situation and saying it was a scam. The Curve team also scrambled to confirm that the contract deployed by the developer had the same code and that there were no significant changes or backdoors added i.e. there was nothing malicious in the contracts.

    So Curve ended up declaring that this was their official token and DAO launch, and needless to say, the cryptocurrency community were not happy about it. This was made worse by the fact that in the hours between the time the developer launched $CRV and Curve declaring it was an official launch, 80,000 CRV tokens were already mined by some users. This led many others to say that it was unfair to others considering the Curve team had previously announced there would be 24 hours between the contract being deployed and the first token being issued.

    Curve team declares their DAO and $CRV was launched

    Following this announcement, other major exchanges such as Binance, OKEx etc. also began listing $CRV.

    $CRV is highly volatile, prices were at an all time high of $54.01 on 14th August 2020, and went to an all time low of $4.17 on 17th August 2020. Also being a mined currency, the initial supply will be extremely low and only increases over time after more has been mined. This results in prices being highly volatile as we can see because with more tokens will be mined, these miners will quickly sell their tokens on the market. This is especially the case during the initial launch phase where there is a lot of hype, but very little supply.

    So those speculating on $CRV really need to exercise caution because it is very risky.

    How to Use Curve to Trade

    In order to use Curve Finance, simply go to their web portal at https://www.curve.fi and connect a web3 wallet like MetaMask.

    Choose which cryptocurrencies you want to trade. Then, click “Sell” at the bottom. You will then be prompted by your web3 wallet to confirm the transaction.

    Once confirmed, it means that your trade is successful.

    Conclusion

    While Curve can also be a profitable alternative against Uniswap in terms of high frequency and large volume trades, everyone still has to consider how to effectively balance potential earnings from its corresponding risks.

    And if the Curve project continues its run successfully in the months and years to come, it might even become one of the best performing DEXs in the DeFi space for offering low slippage trades as compared with its competitors.

    Decentralised Finance (DeFi) series: tutorials, guides and more

    With content for both beginners and more advanced users, check out our YouTube DeFi series containing tutorials on the ESSENTIAL TOOLS you need for trading in the DeFi space e.g. MetaMask and Uniswap. As well as a deep dive into popular DeFi topics such as decentralized exchanges, borrowing-lending platforms and NFT marketplaces

    The DeFi series on this website also covers topics not explored on YouTube. For an introduction on what is DeFi, check out Decentralized Finance (DeFi) Overview: A guide to the HOTTEST trend in cryptocurrency

    Tutorials and guides for the ESSENTIAL DEFI TOOLS:

    More videos and articles are coming soon as part of our DeFi series, so be sure to SUBSCRIBE to our Youtube channel so you can be notified as soon as they come out!

    Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.

  • Ampleforth ($AMPL) review: The essential guide to this DeFi protocol

    Ampleforth ($AMPL) review: The essential guide to this DeFi protocol

    Ampleforth is a game changer that is claiming the spotlight on Decentralised Finance (DeFi) following the success of several lending platforms such as Compound ($COMP), Aave ($LEND), dYdX, etc. Ampleforth is a DeFi protocol that aims to reinvent money both within and beyond the cryptocurrency space. While centralized finance (CeFi) and DeFi as we know today have their own unique sets of problems, the Ampleforth protocol is here with the aim to address them.

    The protocol has a native token known as $AMPL. It is a stable currency that has both inflationary and deflationary capabilities designed to adapt to demand.

    Background

    Ampleforth was created by Evan Kuo, an engineering graduate of UC Berkley. He was also the former CEO of Pythagoras Pizza, the first pizzeria to tokenize its franchise.

    Evan Kuo
    Evan Kuo (Image credit: Cody Pickens)

    Kuo’s motivation for creating Ampleforth was twofold. The death of his father, which made him want to leave a legacy after his passing, and his passion for tech and finance which brought him into the cryptocurrency industry.

    He recognised two things that cryptocurrency was trying to reinvent: money and banking. Of the two, money was a lot easier to work with and so that became his focus.

    The Ampleforth Foundation was then funded by Pantera Capital, True Ventures, Huobi exchange and Brian Armstrong. Most of the members of the foundation consist of “engineers, academics, investors, and enthusiasts” from Ivy League universities.

    Ampleforth raised a total of nearly $10 million USD in 2 Initial Coin Offerings (ICO) and an Initial Exchange Offering (IEO).

    Ampleforth Protocol

    Ampleforth Protocol is a cryptocurrency ecosystem built on the Ethereum blockchain. What makes it stand out is its adaptive supply, that is to say, Ampleforth adjusts the circulating supply according to demand.

    When the demand for Ampleforth increases, the supply increases. Conversely, when demand decreases, the supply also decreases. This makes Ampleforth prone to being mistaken as a stablecoin since it does function quite similarly.

    However, it is not backed by any cryptocurrency or fiat currency like most stablecoins are. And although the system attempts to keep the value close to $1 USD, sometimes it could go way past $3 USD depending on the demand.

    As of press time, $AMPL is trading at $1.64 USD according to Coin Market Cap.

    The Ampleforth Protocol is autonomous, but not decentralized. The Foundation still holds the keys to the system, and have the power to freeze all assets or change token supply arbitrarily. So for some decentralization purists, this is a red flag.

    Ampleforth Monetary Policy

    Kuo came up with Ampleforth’s economic design after examining the history of the U.S. Dollar. Back in the day, every U.S. Dollar bill was backed by gold bullions, which were stored in government vaults. Gold is a great store of value but it has an inflexible supply. Furthermore, going by the gold standard alone runs the risk of runaway deflation.

    After World War II, the Dollar was in high demand globally and the U.S. couldn’t keep up. The amount of gold is fixed since mining can only introduce very small amounts of new gold in a given timeframe. Therefore, the U.S. government decided to abandon the gold standard to avoid stagnation of international trade.

    And that became the birth of the fiat U.S. Dollar, which we now know has its own set of shortcomings. One problem with fiat money is that you could only print more of them but not destroy them. Therefore, the supply can only be partially controlled in a sense. Furthermore, the people in charge of the minting facility is also subject to greed and corruption.

    Ampleforth’s monetary policy is a solution to both fiat and gold-backed currencies since it is designed to maintain a stable value by adjusting the supply to match demand.

    As an illustration, say you have 1 AMPL worth $1 in your wallet. If the demand for AMPL rises and causes the price to jump to $2, the Amplforth Protocol will expand the supply of AMPL such that you’ll end up with two AMPL in your wallet worth $2. This process is called a “rebase”.

    The rebasing process does not dilute existing token holders. You get to retain the same percentage of the total supply yet the value you held doubled.

    Ampleforth use cases

    Ampleforth divides its use cases based on its goals: near term, medium term and long term use cases. In the near term, AMPL aims to diversify cryptocurrency portfolios. Most cryptocurrencies are correlated to Bitcoin’s price pattern, which poses a risk. But because of AMPL’s rebase mechanism, it is decoupled from Bitcoin’s price pattern and allows cryptocurrency traders to have some diversity in their portfolio.

    In the medium term, Ampleforth aims to work as a stable store of value or form of collateral for decentralised banks and DeFi applications. This is because unlike fiat-backed stablecoins, it does not pose the risk of devaluation of its underlying asset.

    Ultimately, Ampleforth hopes to become a “A better Bitcoin”. It wants to be an alternative to central-bank money that can adapt to sudden shocks in the market. In that sense, it is competing with Bitcoin and XRP; not to mention national currencies. But as of the moment, it is being used primarily in the cryptocurrency space.

    Another opportunity it offers is arbitrage. Arbitrage traders have the chance to reap profits during the time the supply is reduced when the price rises. On the other hand, they can increase their AMPL allocation before the supply is increased when the price drops.

    How the Amplforth ($AMPL) rebase process works

    The supply of Ampleforth adjusts daily every 1pm EST to match the demand via a smart contract. The system utilizes Chainlink’s oracle network alongside the Ampleforth oracle to siphon price data from KuCoin and Bitfinex.

    The smart contract ensures that Ampleforth sticks within the designated equilibrium range, which is between $0.96-$1.06. If the price of AMPL hits beyond the two extremes, the smart contract will continue to “expand” or “contract” accordingly until the value of the token is in the equilibrium range again.

    AMPL price vs supply
    AMPL price vs supply

    Ampleforth Geyser: What is it?

    Ampleforth Geyser is a smart faucet that incentivizes liquidity providers to supply AMPL to a Uniswap pool. It is brought about through a collaboration between the Ampleforth Foundation and Uniswap.

    Users are rewarded with AMPL tokens for depositing AMPL to Uniswap. The longer the tokens are held in the pool, the higher the returns.

    Ampleforth geyser
    Ampleforth geyser

    To make money from Geyser, visit their web portal at ampleforth.org/geyser and connect either your MetaMask or Coinbase wallet. You will need to deposit equal amounts of ETH and AMPL to participate.

    How do I get AMPL tokens?

    Aside from getting AMPL tokens during the rebase process (though this requires you to stake some AMPL in the first place), people can also buy AMPL from cryptocurrency exchanges. Here are the major exchanges that offer AMPL tokens for sale: Uniswap (v2), KuCoin, FTX exchange and Bitfinex. Learn more about our picks for the top best cryptocurrency exchanges of 2020.

    Conclusion

    Ampleforth has to some degree successfully redesigned the way money works despite only being a few years old. Their influence has not penetrated a huge portion of the market as of yet but there is a lot of room for them to grow. And being part of the DeFi movement makes it a lot easier to gain more traction. As a matter of fact, over 36 million AMPL has been deposited in Geyser as of now. This is a great stepping stone for the protocol.

    Ultimately, Ampleforth’s goal is to compete against national currencies, and perhaps against Bitcoin as well, to become the world currency. For now, Ampleforth should work on establishing its trust and legitimacy within the cryptocurrency community, which will be a stepping stone for it to achieve its use-cases.

    Decentralised Finance (DeFi) series: tutorials, guides and more

    With content for both beginners and more advanced users, check out our YouTube DeFi series containing tutorials on the ESSENTIAL TOOLS you need for trading in the DeFi space e.g. MetaMask and Uniswap. As well as a deep dive into popular DeFi topics such as decentralized exchanges, borrowing-lending platforms and NFT marketplaces

    The DeFi series on this website also covers topics not explored on YouTube. For an introduction on what is DeFi, check out Decentralized Finance (DeFi) Overview: A guide to the HOTTEST trend in cryptocurrency

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