DeFi

FTX showed the problems of centralized finance and proved the need for DeFi

Published

7 months ago

14 June, 2024

FTX showed the problems of centralized finance and proved the need for DeFi

Our community continues to learn the hard way the lesson of decentralization. Celsius Network. BlockFi. Digital traveler. Now FTX.

These are all centralized exchanges (CEX) and centrally financed platforms (CeFi). Their business models are centuries old; the only new thing about them is that they offer users exposure to crypto assets – but importantly, not root ownership, since they hold the keys to those assets.

Amanda Cassatt is the founder and CEO of Serotonin, a Web3 marketing agency and product studio.

Like the financial institutions that collapsed in 2008, their economic incentive is to undercollateralize and take risks with user funds. They play political games, cozying up to regulators who claim to care about consumer protection.

Pseudonymous developer Satoshi Nakamoto was inspired by the events of 2008 when creating Bitcoin that year. When the network was launched, they wrote these words in its genesis block, “The Times 03/Jan/2009 Chancellor on cusp of second bank bailout”.

This headline from the Times of London sent a powerful message about Satoshi’s intentions: large financial institutions had spent years privatizing the gains from risk-taking, leading to collapse, and once that happened happened, they forced the public to bear their losses through their influence over politicians. with discretionary decision-making power.

With Bitcoin, Satoshi changed the locus of decision-making from politicians to an automated code base, giving ordinary people the ability to participate without permission in an alternative financial system, where the rules are public, apply to everyone and run automatically. Then, with smart contracts, Ethereum-based decentralized finance (DeFi) brought these benefits in various forms to hundreds of thousands of people.

Echoing the financial collapse of 2008, the collapse of FTX and Alameda Research sparked a “bank run” in crypto markets. Some CEX and CeFi platforms are overwhelmed by users withdrawing funds, forcing them to freeze transfers out of the platform. Some must be insolvent.

Those who have funds on FTX will likely lose their money. A number of large venture capital firms as well as Web3 companies told their investors on Wednesday that a significant portion of their assets under management [assets under management] or cash was lost to CEXs. It is difficult to learn the basic hygiene of keeping minimal funds on CEX only for immediate transactions.

Despite the massive sell-off, Uniswap, Balancer, Curv and other decentralized exchange (DEX) and decentralized finance (DeFi) platforms are operating smoothly, allowing users to exit their crypto positions or, if they prefer, to capitalize on the low prices and buy. Users may have seen their wallet value decline in dollar terms, but they never lost access to their assets. If that’s not consumer protection, I don’t know what is.

When I was at ConsenSys and we first introduced Ethereum to the world, we had a sign at our events that said, “Welcome to the decentralized future.” Our community was then, and still is, asked to explain the use of this new technology. The best answer was and remains decentralization.

DeFi platforms are designed to preserve the advantages introduced by Bitcoin and amplified by Ethereum: permissionlessness, transparency, censorship resistance and self-sovereign custody of assets.

Users should insist on a base settlement layer for economic activity that is as decentralized as possible, to avoid exactly the scenario that has occurred in recent days. History may not repeat itself, but it certainly rhymes — and we would do well to heed the lessons it teaches.

Like the large financial institutions involved in the 2008 collapse, which donated generously to political campaigns, the cryptocurrency exchange FTX has spent its last few weeks spending lavishly with legal regulators. Its founder and CEO, Sam Bankman-Fried, even had the audacity to say that DeFi needed consumer protections while, as has become clear, gambling with user funds.

Consider for a moment that SBF operated the second largest CEX and that centralized platforms view DeFi as a competitor. What it wanted from regulation was not consumer protection, but rather protection of its current position and strengthening its competitive advantage.

Regulators are paying attention to this collapse, as is their job. Those with good intentions should see through the Times Square billboards about ESG. [environment and social governance] and fancy parties and understand that the centralized actors who are calling for DeFi regulation are doing so because it serves their interests. Regulators should also recognize that when it comes to consumer protection, DeFi has CeFi beat time and time again.

Regulation that would not overprotect incumbents or harm truly decentralized projects could be a boon for the sector, providing the clarity that waiting institutional investors need to begin deploying capital. This could rid our space of many of its scams by making it riskier to perpetrate.

If there is a positive side to the FTX fiasco, it is a reminder of the importance of decentralization. While it took a massive blow to all crypto prices, layer 1 blockchains that deprioritized decentralization as a design goal were hit the hardest.

The collapse of FTX was a failure of CeFi, not DeFi – and smart investors, builders and users have already taken note. I think many have learned their lesson this time. To them: welcome, once again, to the decentralized future.

Fuente

DeFi

If You Missed BONK and PEPE This Year, This Viral New Crypto Might Be Your Salvation

Published

6 months ago

29 July, 2024

CoinFlix Staff

If You Missed BONK and PEPE This Year, This Viral New Crypto Might Be Your Salvation

Bonk and Pepe appear set to net new investors 10x to 100x returns over the next 12 months. However, cryptocurrencies in the DeFi play-to-earn gaming sector could offer even greater returns. As August approaches, Rollblock is emerging as a standout DeFi play-to-earn gem with the potential to 100x-1000x gains in the fourth quarter and beyond.

The project features an innovative revenue sharing model and exceptional accessibility, attracting players and investors. Additionally, Rollblock’s extensive game library of over 150 titles and enhanced sports betting are further driving excitement for the platform. Cryptocurrency analysts are expecting a sudden surge in demand. 800% a push for Rollblock from the beginning of September.

Bonk remains strong despite market fluctuations

While most well-known cryptocurrencies struggled throughout July, Bonk remained strong. As one of the highest-grossing meme cryptocurrencies of 2024, Bonk rose over 24% in July, while most cryptocurrencies experienced negative fluctuations.

Investors looking to add a relatively safe memecoin to their portfolio should consider Bonk. While Bonk is unlikely to generate explosive gains of 250x to 1,000x from here on out, Bonk could still theoretically provide returns in the 20x to 100x range.

Pepe should see a big rise in the next bull run

Alongside Bonk, Pepe has yet to go through a bull run. This means that there are still substantial gains to be made from Pepe over the next 12 months.

Pepe is down 4% in 30 days, but that shouldn’t worry Pepe investors in 2024. Experts believe Pepe’s best days are still ahead, with crypto analysts predicting a 10x to 50x surge in the next election cycle around November.

In the long term, Pepe could surpass the 100x mark for today’s investors. However, Pepe is a memecoin, and one should exercise caution when investing in purely speculative assets that have no utility.

Rollblock’s Unprecedented Hype Potential Could Push It Past 100x Valuation in Q4

Rollblock is a GambleFi Play-to-Earn token that integrates centralized and decentralized gambling on a single platform. By allowing players to earn rewards through active participation and gameplay, the platform creates a compelling incentive structure that appeals to both casual and competitive players.

With its cutting-edge blockchain technology, Rollblock offers top-notch security that keeps bets and transactions on the platform secure. The platform’s lack of KYC mandates appeals to both users who value anonymity and security.

Rollblock’s revenue sharing model, which allocates up to 30% of casino revenue to RBLK token holders, is a major draw for investors. The model involves burning half of the repurchased tokens and distributing the other half to stakers, increasing the token’s value and encouraging long-term investment.

The platform is also constantly evolving thanks to user feedback which has enabled updates such as the upcoming sports betting feature within the platform’s casino. This addition will complement Rollblock’s extensive game library of over 150 titles, ranging from traditional poker to innovative blockchain-based games.

RBLK is expected to emerge as one of the leading DeFi tokens in 2024. With a price of $0.0172 with impressive growth potential and over 140 million tokens sold recently, Rollblock is on track to enter the top 100 cryptocurrencies by Q4, making today a lucrative time to buy RBLK tokens.

Discover the exciting opportunities of the Rollblock (RBLK) presale today!

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Fuente

DeFi

Cryptocurrency sector is experiencing ‘most misjudged moment’ since 2020, says venture capitalist Arthur Cheong

Published

6 months ago

29 July, 2024

CoinFlix Staff

Cryptocurrency sector is experiencing ‘most misjudged moment’ since 2020, says venture capitalist Arthur Cheong

Veteran cryptocurrency investor Arthur Cheong believes the digital asset sector offers long-term holders a golden opportunity.

Cheong, the founder of DeFiance Capital, tell His 171,700 followers on social media platform X indicate that he believes decentralized finance (DeFi) is hugely undervalued.

According to Cheong, DeFi projects are innovating at a rapid pace and leaving traditional financial (TradFi) companies in the dust.

“It’s been a long time since I’ve been this excited about the risk/reward and potential upside of DeFi. This is probably the most misjudged moment since the pre-DeFi summer of 2020, with extremely promising prospects.

I see opportunities not only in OG (original) DeFi, but also in some newer projects that are evolving rapidly and growing at a pace that fintech startups will do anything to match.

The veteran investor also believes that crypto is now here to stay following recent launch from the Ethereum spot market (ETH) exchange-traded funds (ETFs) last week.

“Overall, the floodgates are open and there is no turning back. TradFi asset managers will continue to launch new crypto products because, guess what: there is huge demand for them!”

I expect them to launch actively managed crypto ETFs [in the] coming years. ”

Earlier this month, Cheong laid that it might be a bad strategy for cryptocurrencies to seek mass adoption, believing that digital assets are designed to disrupt several key financial sectors.

“I think we should accept that cryptocurrencies may not be suited for mass adoption like Web2, but rather are optimized for some narrow but very high-impact use cases like stateless global money, cross-border payments, and decentralized finance.

Chasing mass adoption of normies may be chasing the wrong Grail from the start.

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