Crypto Guides, Knowledge & Insights

Shift toward Liquid Staking Derivatives expected after ETH Shanghai upgrade

The Ethereum (ETH) Shanghai update is set to be released in March, allowing withdrawals from the beacon chain and the unstaking of ETH now staked in ETH 2.0 validators.　　With over 70% of ETH stakeholders now losing money because their ETH is unavailable, the Shanghai upgrade will allow them to access their ETH and decide whether to sell at a loss or retain long-term until they are back in profit.Ethereum: Mean and Median Block Interval – (Source: Glassnode.com)　　Post-ETH merge　　The ETH integration occurred with the Bellatrix upgrade in September 2022. In the process, the beacon chain took over block validation, completing the move from Proof of Work (POW) to Proof of Stake (POS).　　The beacon chain is managed by validators who must first deposit 32 ETH before they can begin operations. With over 16 million ETH committed in the ETH 2.0 deposit contract, the number of beacon chain validators has now hit 500,000, with a recent surge in additional active validators.Ethereum: Proof-of-Stake Change in Active Validators – (Source: Glassnode.com)　　New ETH credentials format　　Validators who want to withdraw their staking rewards must update their withdrawal credentials to the new “0x01” standardized format. Validators who want to stop validating or exit their full balance must meet

2023-01-16Deep Dive

Stablecoin collapse could impact U.S. bond market, economist warns

Economist Eswar Prasad warned that a bank run on Stablecoins could have ramifications in the US bond markets if issuers sell US Treasury bonds to meet redemptions.　　Prasad warned that if a bank run occurs when bond market sentiment remained “extremely weak,” the “multiplier effect” from massive selling pressure on Treasurys might ensue.　　“A big volume of redemptions even in a fairly liquid market might create volatility in the underlying securities market. And, considering the importance of the Treasury securities market to the broader financial system in the United States... ”I believe regulators are correct to be concerned.　　According to USDTs November 2022 report, stablecoins such as Tether (USDT) are backed by billions of dollars in reserves to support mass-redemption eventualities.　　However, Prasad warned regulators that if a large number of users attempted to redeem their Stablecoin for cash, issuers such as USDT would be forced to sell assets in their reserve.　　“A significant surge of redemptions can really harm liquidity in that market.”　　As a reminder, WikiBit is ready to help you search the qualifications and reputation of projects in a bid to protect you from hidden dangers in this risky industry!

2023-01-15Deep Dive

Alameda liquidators hit with liquidation for second time in 3 days

In light of recent market movements, Alameda Research liquidators were liquidated for the second time in three days, according to Arkham Intelligence.　　On January 14, Alameda liquidators paid off $15,000 in Curve DAO token (CRV) debt in exchange for 0.83 wrapped Bitcoin (WBTC) — or around $17,600 in collateral.　　According to Arkham Intelligence, Alameda is still short $16,500 in CRV, which is collateralized by $23,000 WBTC.　　Second liquidation in three days　　On December 28, 2022, Alameda liquidators were compelled to become active on-chain after losing over $1.7 million in funds through mixers commonly utilized by hackers.　　Despite the best efforts of Alameda liquidators to collect all funds, Arkham research found that “large 7- and 8-figure sums of capital” remained trapped in Alameda wallets.　　Liquidators attempted to remove assets from a borrow position on the DeFi protocol [Aave] on wallet 0x712.　　Rather than repaying the loan and closing the position, the liquidators chose to remove all extra collateral, putting the position in jeopardy of liquidation.　　When forcibly liquidating the wallets AAVE positions, Alameda liquidators triggered the liquidation of around four WBTC — worth $72,000 — in addition to a penalty shaved from the liquidated collateral.　　As a reminder, WikiBit is ready to help you search the qualifications and reputation of

2023-01-15Deep Dive

Bitcoin breaks $21,000 alongside $255m of 24-hour spot purchases

Bitcoin has surpassed the $21,000 mark.　　BTC was worth $21,083 at 12:59 a.m. UTC on January 14, according to Coingecko data. Its market capitalization was $403 billion. This indicates a 12% growth in just 24 hours.　　Bitcoin prices for Jan. 13-14 via CoinGecko (time in PST)　　According to data, $245 million in shorts were liquidated in the last 24 hours, while $255 million in Bitcoin was purchased on spot markets today.　　There are no noteworthy events that could have clearly boosted investor activity. Rather, shifting investor mood may be attributable to a lack of bad news, as well as the notion that huge catastrophes such as FTXs demise are becoming a thing of the past.　　Furthermore, todays gains reflect continued growth over the last few days. Positive anticipation and sentiment surrounding a Consumer Price Index (CPI) report appears to contribute to Bitcoins price gain this week.　　The round figure of $20,000 also indicates a psychological barrier, and as such, investors may be encouraged that Bitcoin has overcome it.　　Bitcoin normally leads the crypto market, and its success today contributed to the overall expansion of the crypto market. The whole crypto market cap has increased by 8% in the last 24 hours, reaching $1.02 trillion.　　Today, Bitcoin and the

2023-01-14Deep Dive

Hong Kong will restrict cryptocurrency trading by retail investors to just "highly liquid" products.

The majority of individuals are aware that the cryptocurrency market can result in significant losses quickly as well as quick rewards. Knowing this, organizations and businesses attempting to implement this technology are required to keep the safety of their customers in mind.　　According to the news of the day, Hong Kong is implementing a strategy to give priority to consumer rights by restricting individual investors to only trade “Highly Liquid” Crypto Assets. On January 11, this information was made public during the Asia Financial Forum.　　Hong Kong Will Compile A List Of Crypto Assets For Retail Investors　　According to Julia Leung Fung-yee, CEO of the Securities and Futures Commission (SFC), Hong Kong regulators are taking substantial steps to bring crypto to the territory. To enable retail investors to trade only “highly liquid” assets with a licensing law, it includes shortlisting cryptocurrency assets.　　Leung also mentioned that the SFC will publish a discussion paper later this quarter with further information on the products and requirements for individual investors to trade in assets. Leung made these remarks on Wednesday at the Asia Financial Forum. The SFC will also publish guidelines for the licensing requirements for exchanges of virtual assets concurrently.　　Leung noted the drawback of only allowing

2023-01-13Deep Dive

In Hong Kong, Samsung will introduce a Bitcoin ETF.

Big players in the technology business are becoming interested as the blockchain and cryptocurrency industries are growing rapidly. One such company is the South Korean electronics giant Samsung, which announced today the creation of a Bitcoin (BTC) exchange-traded fund (ETF) in Hong Kong.　　Based on a statement by the Korean media outlet Fortune Korea posted on January 12, Samsung explicitly noted that the registration of the “Samsung Bitcoin Futures Active ETF” on the Hong Kong stock market should occur on January 13.　　The registration, which followed the establishment of two other ETFs by the electronics giant - “Samsung Blockchain Technology ETF” and “Samsung Asia Pacific Metabus ETF,” that were officially launched last year - will be conducted by the businesss financial division, Samsung Asset Management.　　By trading in Bitcoin futures items listed on the Chicago Mercantile Exchange (CME), particularly the CME Bitcoin Futures and CME Micro-Bitcoin Futures, the newly-listed ETF will monitor the spot price of Bitcoin.　　Samsung Asset Management Hong Kongs head, Park Seong-jin, commented on the progress by stating that:　　“The Samsung Bitcoin ETF is a competitive product that reflects the know-how and risk management experience of Samsungs long-term operation of the futures-based ETFs, which will represent a new option for investors interested

2023-01-13Deep Dive

Coinbase will end most of its operations in Japan.

In accordance with a latest comment by Nana Murugesan, the firms vice president for business development and international, the U.S.-based cryptocurrency exchange Coinbase will reduce the majority of its activities in Japan.　　In a Wednesday conversation, Murugesan stated:　　“Weve decided to wind down the majority of our operations in Japan, which led to eliminating most of the roles in our Japan entity.” Considering the Japanese entitys merger and acquisition operations, he chose not to remark.　　Murugesan did not disclose how several Japanese workers are impacted by the news, but he did indicate that a limited group will continue to be dedicated to ensuring the safety of clients assets.　　　　The Nasdaq-listed Coinbase exchange was authorized to serve Japanese consumers on June 18 last year, following filing with the countrys Financial Services Agency (FSA), the countrys top financial watchdog.　　Murugesan highlighted that Coinbase Japan is in a transformation process till negotiations with Japans FSA are completed. Nao Kitazawa, the entitys chief executive officer, is pushing the discussions and will make his announcement “afterward.”　　A busy 2023 for Coinbase　　Just two weeks into the New Year, and Coinbase is already hardly ever out of the news. The New York Department of Financial Services and the corporation reached an agreement last

2023-01-13Deep Dive

Hard Fork Coming to Polygon's Blockchain

A wide variety of economic output, including NFT marketplaces, gaming, and the expanding DeFi ecosystem, can be found on the Ethereum blockchain. Due to its compatibility with smart contracts that can be employed to create a broad range of applications, Ethereum is ideally suited for this task.　　Nevertheless, as these applications gain more traction, more activities are added to the Ethereum blockchain. As a consequence, transaction costs, or “gas,” might occasionally increase to the level where making quick or frequent deposits can become unprofitable.　　Enter Polygon, a “Layer 2” scaling solution (or “sidechain”) that has developed to offer users cheaper and quicker transactions. Alongside the original Ethereum blockchain, it functions as a quick secondary blockchain. By “bridging” some of your cryptocurrency to Polygon, you may use it to access a variety of well-known crypto applications that were previously restricted to the primary Ethereum blockchain.　　　　A planned hard fork to Polygons proof-of-stake (PoS) blockchain has been disclosed as part of the developments scalability of Ethereum. The software change is expected to occur on January 17 if approved, and it will manage gas price increases and chain rearrangement (reorgs). The Polygon team was initially made aware of the hard fork conversation in December 2022.　　What lies

2023-01-13Deep Dive

Binance claims that the BUSD peg was maintained with flaws.

Bringing Up The Problems With The BUSD Peg　　After an examination of the Binance Smart Chain was published, concerns about the pegging to the Binance BUSD initially surfaced. Patrick Tan highlighted that there have been instances in the past where BUSD, and more especially the BUSD on BSC, have not been supported by an equal number in dollars.　　　　For those who do not know, Paxos and Ethereum collaborated to produce the initial iteration of BUSD on the Ethereum network. This stablecoin is governed and actually endorsed by an equivalent amount of dollars. However, Binance started minting BUSD on BSC after launching its very own blockchain in 2020.　　Because the BUSD on Ethereum was backed by dollars, it was planned that the BUSD on Ethereum would serve as security for the BUSD issued on BSC. This would imply that a comparable quantity of the stablecoin would be maintained in an Ethereum wallet for every unit of BUSD that was created on BSC.　　The issue surfaced when it was discovered that, on many occasions, the Ethereum wallet that was meant to house the equal BUSD issued on BSC instead held less BUSD than that of the stablecoins floating on the Binance Chain.　　Simply put, this means that

2023-01-12Deep Dive

Gemini Terminates the Crypto Earn Program in the Wake of DCG Collapse

The flagship Earn programs interest-bearing item has been formally discontinued by Gemini. On January 10, this message was distributed through email. The existing Master Loan Agreements between Gemini and Genesis Global Capital, which was in charge of managing the Earn program on behalf of its clients, have been terminated.　　　　This action by Gemini is a continuation of the widely publicized conflict with Genesis and itself. Gemini stated in the email it issued to its clients on Tuesday that it was ending the programme in an effort to convince Genesis to pay back the $900 million the firm owed the exchanges users.　　The email noted:　　“We are writing to let you know that Gemini—acting as agent on your behalf—has terminated the Master Loan Agreement (MLA) between you and Genesis Global Capital, LLC (Genesis), effective as of January 8, 2023.”　　Also stated by the business, “This officially terminates the Earn Program and requires Genesis to return all assets outstanding in the program. Existing redemption requests are not impacted and continue to await fulfillment by Genesis.”　　As previously indicated, the email claimed that the company would arrive at a solution for the clients who want to reclaim their assets and that the current cash withdrawals wont be impacted.　　The

2023-01-12Deep Dive

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