Autor Cointelegraph By Dilip Kumar Patairya

What is crypto copy trading and how does it work?

What is crypto copy trading and how does it work?

Uverejnil používateľ | nov 5, 2022 |

Cryptocurrency trading is a complex skill requiring extensive knowledge of fundamental and technical analysis and the cryptocurrency ecosystem as a whole. As most traders lack the capability to develop a winning trading strategy, they struggle to learn a multitude of skills needed to be a successful investor (who knows how to swim through the steep tides of the waters).Do amateur traders have no hope, then? Are they left to fend for themselves, speculating about the prices and taking to stride the sharp ups and downs of the cryptocurrency industry? Thankfully, there are tools that help such traders explore the potential of the cryptocurrency industry, simplifying over-complex cryptocurrency trading by following expert traders.This article discusses what cryptocurrency copy trading is, how it works, its legitimacy and its limitations. It also talks about how a holistic approach to copy trading can play a key role in the evolution of traders.What is cryptocurrency copy tradingCryptocurrency copy trading is an automated strategy that lets one copy an experienced trader’s trading methods. This enables one to buy and sell crypto assets to earn profits without putting in a lot of time for researching or gaining proficiency in crypto trading.Basically, cryptocurrency copy trading is all about identifying skilled traders and re-executing their moves literally. A trader doesn’t have to spend time picking market trends or learning complex trading methods. Rather, the software just mimics what the expert trader is doing.For instance, if the trader the copy trading software is following invests $100 to buy coin A, the software will also spend $100 on the same cryptocurrency. The tool not only helps amateur traders to use the expertise of other traders but also helps them learn the skill of making smart investment decisions.Alternatively, one could join trading groups on Facebook or Robinhood to get advice on the right cryptocurrency trading strategy at their own risk, as nothing is a sure shot in the crypto industry, given the volatility of the market. This practice is termed cryptocurrency social trading. On these platforms, seasoned traders suggest which crypto assets they should buy or sell. However, the process is manual and there are chances of the traders failing to implement it without mistakes, thus diminishing the probability of success.How does crypto copy trading workChoosing a skilled copy trader and software are two essentials for successful copy trading. Here is some light on how to get started with cryptocurrency copy trading:Select the right traderWhen one decides to go for crypto copy trading, the first step is to identify the right trader. The efficiency of copy trading is invariably hooked to the skill level of the trader one is following. They need to carefully research the available traders and analyze their skill levels against certain parameters such as profitability of trades, the total amount of funds they manage, risk level and the number of followers, among others.The array of parameters one eventually chooses depends on their own preferences. Amateur cryptocurrency investors need to carefully determine what is important to them for making a decision regarding crypto trading strategy.One might question how they will be able to get insights into the performance of various traders. It is to find all required information on typical copy trading software as traders willingly consent to give member traders access to their trading moves. One can examine the track record of various lead traders on the dashboard and select the one that fits in with the parameters of their choice.The lead traders themselves are paid a small fee for allowing their trades to be copied. The fee usually hovers around 7% of the profit made. Thus, the system works to the advantage of expert traders as well as those following them.Set up the softwareSelecting the right software is as important as choosing the right cryptocurrency trader. Once the trader zeroes in on the software, the next step is to set it up. Though it might take some time, it is a fluent ride later as the process is automated. The software could usually be set up to invest the same amount or the percentage as the trader being emulated.Even after the software is set up, a trader could switch to another trader any time they want. They could pause any trade the software makes or could decide on their own about closing a position without waiting for the action of the lead trader.Cryptocurrency investors can also choose more than one lead trader to diversify their portfolio. However, one needs to determine the chunk of funds they want to allocate to each lead manager.Keep the vigilAlgorithms of the trading platforms are designed to automatically copy the trade of the lead investors. However, one is in total control of trading and can overrule the software anytime. Traders can leave it totally to the software or watch the portfolio selection of their peers themselves and take trading actions based on their investment goals.Is copying cryptocurrency trades legalCopy trading creates the impression of being a pioneering term; however, it has been around for a while. Regulatory bodies such as the Financial Conduct Authority (FCA), a financial regulatory body in the United Kingdom, and European Securities and Markets Authority (ESMA), the European Union’s financial markets regulator and supervisor, have recognized copy trading.To comprehend the legal status of copy trading in the country one resides in before investing is as important as to establish that the dealer is regulated. Plenty of regulations have been framed for copy trading, so one can regard copy trading as a legitimate trading method if they are using an authorized service.Risks of cryptocurrency copy tradingTo a large extent, the efficiency of the cryptocurrency trading process depends on the choice of the platform and expertise of the lead trader. A wrong move could dampen the whole exercise. It is important to make every decision after due diligence.There are so many crypto copy trading platforms that picking the right one could be quite demanding for an amateur trader having little knowledge about the domain. A trader failing to make a well thought out decision might result in them losing hundreds or thousands of dollars. Seasoned copy traders would compare the features of various platforms and go through their reviews before arriving at a decision.When looking for a trader, choosing one in the age of social media is challenging. A Flood of information from all sorts of sources, reliable and unreliable, makes the task steeper. It is important to do adequate research when selecting a trader rather than just going through a person’s profile.All software, no matter how well they are developed, might go wrong at any time and begin delivering unexpected outcomes. A trader needs to keep monitoring the cryptocurrency trading process and exit their position if they feel they are generating continual losses.Trading is a full-time job requiring cryptocurrency investors to spend full days studying charts, updating themselves about the latest developments and testing various scenarios to determine when to buy and sell cryptocurrency. While copy trading allows a trader to view the actions of lead traders, they don’t get to see the work behind the scenes that led them to make those moves.Holistic and long-term view of cryptocurrency copy tradingFactoring in all aspects of cryptocurrency copy trading is important before investing. At its core, the cryptocurrency copy trading process is about taking advantage of the expertise of a previously successful trader, practically negating the time one would usually need to develop trading skills of the same level.If one is able to choose a trade-worthy platform and the right trader to copy, it might turn out into a profitable long-term trading approach. For rookie traders, learning how to buy and sell cryptocurrency could be perplexing. When copy trading, they are able to see the action of an experienced trader in real time, helping them to understand the nuances. They are able to learn, read the trading charts and gain the ability to respond to changing market conditions.Copy trading could be the first step for one to become a proficient cryptocurrency investor. Regular monitoring of lead traders’ actions backed by behind-the-scenes learning may help amateur traders to hone their cryptocurrency investing skills and evolve as expert traders themselves.

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What is Comtech Gold (CGO) and how does it work?

What is Comtech Gold (CGO) and how does it work?

Uverejnil používateľ | okt 20, 2022 |

The take-off of digital gold has the potential to disrupt the industry to an unprecedented degree. Historically, gold has been used as a global currency as a hedge against inflation. It has also been serving as an investment venue (commodities), often preferred over other asset classes like equities or foreign exchange, particularly in conventional markets. However, there are certain disadvantages to owning physical gold, such as inconvenience in transport and storage, as well as the risk of theft. Gold exchange-traded funds (ETFs) might come across as an alternative option, but it cannot be forgotten that the traders don’t actually own the gold while paying the same taxes as gold bullion, or gold bars, and also investors have to pay an annual fee of around 0.4% to 1%. Gold contains all forms of metal, like coins and bars, whereas bullion includes all the exchangeable physical forms of other precious metals, like silver and platinum.In contrast, digitized gold stored on blockchain comes across as a robust option. This is what Comtech Gold (CGO) comes in, combining the benefits of gold with the advantages of blockchain. CGO solves the prevailing problems in gold trading by rolling out a 100% gold-backed cryptocurrency.CGO caters to the needs of individuals as well as corporate investors. It eliminates the need for retail investors to visit local markets to buy gold. Moreover, it makes things better for institutional investors by setting aside any need to store gold in physical form. Introduction to Comtech GoldComtech Gold has added another dimension to gold trading by issuing standardized digital gold backed by 100% physical gold. Built on XinFin XDC Network, an advanced blockchain, the project is also Shariah-compliant and certified by one of the renowned Shariah scholars group in the United Arab Emirates.Digital gold can be transformed into physical gold anytime, resolving the storage and transfer-related issues associated with gold. The fractionalization of the precious metal makes investment in gold more common. Holders of CGO tokens own gold physically in the same proportion. Though each holder is entitled to a certain amount of gold, it might not be the specific bars they had submitted. The arrangement works quite like a bank where the bank hands over bills of a certain value as requested by the person withdrawing, but not necessarily the same bills that they had deposited in cash.Underlying physical goldEach token on Comtech Gold represents 1 gram of gold with prices hinged to the prevailing international gold rate. The tokens are fully backed by the gold bars identifiable through their bar numbers. These are standardized 1 kg bars of 999.9 purity. Anyone holding gold-backed tokens is able to convert their tokens to physical 1 kg gold bars. When an investor has gold tokens equivalent to 1 kg (1000 CGO tokens), they can place a request regarding the submission of their tokens for physical 1 kg gold bars.As the network of Comtech Gold increases, one will be able to buy the tokens and redeem them at the time of their choice in smaller denominations at recognized retailers’ shops.Sharia complianceFully based on Shariah principles, Comtech Gold lays down an ecosystem where physical gold associated with each gold-backed token is identifiable and segregated. As Shariah compliance requires, each transaction will culminate in the actual delivery of tokens from the seller to the buyer. All aspects of the token are completely auditable, right from creation to redemption. The Shariah certification (Fatwa) was issued by Amanie Advisory Group, an entity specializing in the fields of shariah-compliant investments and Islamic finance solutions. Supported by the guidance from the advisory team, the ComTech Gold Shariah certification was provided after confirming that the structure, mechanism and relevant key legal documentations of Comtech Gold token met all the necessary Shariah requirements.The certification is in line with Islamic rules and standards defined by the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI).Vault and storageThe physical bars underlying the gold tokens are stored with Transguard, a globally accepted vault. Under the users’ wallet account, the audit trail is fully complete. Users can use their wallets to view their balance and transfer tokens. All wallets are encrypted, enabling access only to the owner.Storing gold has always been a pain, whether at home or in a bank due to safety and convenience issues. With Comtech Gold, however, users can store gold in a tokenized form, move around their holdings and even dispose of their investments at will.Tokenization of physical goldGold is a valuable metal, making investments economically infeasible for a large chunk of people. Digitization of gold leads to fractional investment, enabling people to buy as low as 1 gram, thus significantly expanding the horizon for investors. Comtech Gold facilitates the purchase of a minimum of 0.01 grams.On Comtech Gold, users can deposit their personal physical gold in a standardized 1 kilogram bar and get tokens against it. Any investor holding coins equivalent to 1 kg or more of gold can cancel their tokens in exchange for equivalent gold in multiples of 1000 tokens (1 kg gold). The steps are listed below:Regulatory oversight, collaboration with gold custodians with a robust track record, and escrow account set aside any possible apprehensions.How does Comtech Gold work?Based on the XinFin XDC Network blockchain, Comtech Gold protocol brings in all the advantages of a decentralized ecosystem. Tokenization makes holding and trading gold assets so simple compared with physical gold. Moreover, unlike fiat currency or physical gold, tokens are much more fluid.Native CGO tokens, stored on the XDC Network blockchain, can be managed by the user through the wallets that support the XDC Network’s XRC-20 tokens. Users can view the token balance and transfer tokens to a receiver address using the XDC Network. Once the transaction is complete, users can confirm it with XinFin XDC network explorers. The entire transaction process takes a few seconds with near-zero transaction fees.When transferring CGO tokens, users needs to pay a standard gas fee along with an additional fee for CGO transfer. For instance, if users need to transfer 20 CGO from one XRC-20 address to another, they might need to send 20.003 CGO to cover the fee levied. This fee helps manage the protocol and the vault. There is no custody fee as well.As CGO is hinged on real physical gold, the price will closely follow international gold prices. Market-related ups and downs in the gold prices offline will reflect in the price of the CGO token.A product of the timesWe are living in a time when almost a parallel world is developing in the digital landscape. Millennials prefer to handle all their assets online, from bank assets to stocks and digitized gold is a natural extension of what they do. Asset-backed tokens on Comtech Gold help eliminate the issues not just prevailing in conventional gold buying and trading but also brings in more advantages than products like gold ETF. Fractionalization of the underlying assets even helps those investors who were out of gold-related investments because it wasn’t financially viable for them.As the technology advances and the ecosystem becomes more streamlined, it is likely to begin gaining more traction. When it accommodates functions like lending and borrowing at a later date, it will acquire a more dynamic proportion.Purchase a licence for this article. Powered by SharpShark.

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How does zero-knowledge proof authentication help create a portable digital identity solution?

How does zero-knowledge proof authentication help create a portable digital identity solution?

Uverejnil používateľ | okt 14, 2022 |

Web engineers have been working for a long time to determine if there is a way to prove something is true without revealing any data that substantiates the claim. Zero-knowledge proof (ZKP) technology has enabled the deployment of cryptographic algorithms for verifying the veracity of claims regarding the possession of data without unraveling it. These proof mechanisms have led to advanced mechanisms that enhance privacy and security.Leveraging blockchain deals with problems related to centralization, while the lack of privacy in decentralized applications (DApps) can be balanced with cryptographic ZKP algorithms.This article provides a primer on zero-knowledge proofs, portable identity, problems in prevailing identity solutions, blockchain-based zero-knowledge proof powered portable identity solutions, trustless authentication and the process of creating password credentials.What is a zero-knowledge proof?A zero-knowledge proof is a cryptographic technique that establishes the authenticity of a specific claim. It enables a protocol to demonstrate to a verifier that a claim about certain confidential information is accurate without disclosing any critical information. The technology facilitates interactive as well as non-interactive zero-knowledge-proof applications. An interactive proof needs multiple communication mechanisms between the two parties. On the other hand, a non-interactive zero-knowledge proof requires a single exchange of information between participants (prover and verifier). It improves zero-knowledge efficiency by reducing the back-and-forth communication between the prover and the verifier.A zero-knowledge proof works by a prover showcasing to a verifier that they have an identifying secret without disclosing the secret itself. For instance, a prover might be holding an asymmetric key pair and using the identifying secret as a private key to respond to the statement sent with the public key. This culminates in a situation where the verifier is convinced that the prover has the key without the prover revealing it.Thanks to zero-knowledge proof technology, a user could demonstrate they are of an appropriate age to get access to a product or service without revealing their age. Or someone could prove they have sufficient income to fulfill criteria without having to share precise information about their bank balance.Zero-knowledge identity authenticationThe need of businesses to manage voluminous amounts of consumer data while ensuring consumers’ privacy and complex regulatory compliance led to a burgeoning need for innovative digital identity solutions. Zero-knowledge proof has helped fructify the concept of a portable digital identity efficiently.Identity portability refers to the ability of users to generate a single set of digital ID credentials usable across multiple platforms. A digital identity management scheme clubs unique identifiers on a user’s device, relevant legal documents and biometrics such as face ID or fingerprints. Understanding how a decentralized identity (DID) wallet is stored on a smartphone will help you get a better grasp. An issuer attaches a public key to verifiable credentials they have issued. Securely held in the wallet, the credentials are passed on to the verifiers. All a verifier needs to do is confirm that the proper issuer cryptographically signed a credential sent by a user.Problems in prevalent identity solutionsHard-hitting data breaches, privacy overreach and abysmal authentication have been the nemesis of online applications. This is drastically different from the time of initial web architecture when user identity wasn’t a priority. Traditional authentication methods no longer suffice due to our complex and ever-changing security environment. These methods severely restrict users’ control over their identities and risk management, thus compromising access to essential data. Usually, enterprises use different identity services to resolve various identity-related issues.Stemming data from diverse sources through a string of advanced technologies has made preserving identity-related data a cumbersome task. Gathering multidimensional data while adhering to a vast set of regulations has made it exceedingly complex for businesses to resolve identity-related issues quickly, detect fraud and uncover business opportunities simultaneously.Zero-knowledge-powered-portable identity solutionsCross-channel, portable self-sovereign identity solutions enable enterprises to secure customer access and data using a single platform. Such a seamless identity experience reduces the churn of customers. Effortless, secure workstation login helps secure remote work and reduces fraud risks associated with weak passwords.A blockchain-based solution stores identity within a decentralized ecosystem, enabling one to prove identity when necessary. NuID, for instance, leverages a zero-knowledge proof protocol and distributed ledger technologies to facilitate digital identification for individuals and businesses.NuID’s ecosystem allows users to own and control their digital identity by using services built upon foundational zero-knowledge authentication solutions. The decentralized nature of the solution results in an inherently portable and user-owned identity platform. They can own, control, manage and permit the usage of identity-related data efficiently.The solution makes business enterprises “consumers” of these identities and their associated metadata, thus promoting more privacy-centric interactions. Dynamic data ownership benefits both the user and the service provider. It eliminates the need for companies to secure a humongous amount of user data, as they no longer need to hide any sensitive, identifying information.Trustless authenticationWhen building a software application, authentication is one of the primary steps. In a rapidly evolving security landscape, where context-specific UX (user experience) needs are steadily expanding, user privacy concerns require more than conventional authentication. Applications require a platform that facilitates adaptation to changing demands of digital identification.Trustless authentication provides a robust alternative to the model of storing passwords in private databases. NuID Auth API (Application Programming Interface), for instance, rolls out endpoints for creating and verifying user credentials through ZKP technology, facilitating the generation of proofs and credentials in client applications for use cases like user registration and user login.One can expect an advanced platform to address common authentication and user management pitfalls. Features could include password blacklisting to securely inform users of weak and stolen credentials, modular and accessible authentication UI components, and advanced MFA (multi-factor authentication) functionality.The process of creating password credentialsThe process is somewhat similar to the existing workflow for creating and verifying passwords. One takes user info (name, email, password), posts it to the registration endpoint, and initiates a session. To integrate the registration process, one needs to create a credential on the client side. In place of the password, as done in legacy applications, the verified credential is sent to ZPK-based applications.Here is the usual process for user registration in a portable identity solution based on zero-knowledge proof:The process has no bearing on the remaining registration flow that might include issuing a session, sending email notifications and more.The road aheadAs zero-knowledge proof technology progresses in the coming years, vast amounts of data and credentials are expected to be represented on a blockchain by a public identifier that reveals no user data and cannot be backward-solved for the original secret. Adapting portable identity solutions based on zero-knowledge protocols will help avoid the exposure of the ownership of attributes, thus effectively eliminating the associated threats.Backed by ZKP technology, portable identity solutions have the potential to take data privacy and security to the next level in a wide array of applications, from feeding data into the Internet of Things (IoT) to fraud prevention systems. Purchase a licence for this article. Powered by SharpShark.

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How to earn passive crypto income with Bitcoin

How to earn passive crypto income with Bitcoin

Uverejnil používateľ | okt 6, 2022 |

Bitcoin (BTC), along with other cryptocurrencies, has provided people with a venue to earn passive income, making money without any active involvement. One doesn’t need to take unnecessary trading risks or spend time reading and analyzing reams of information. While the concept of passive earning isn’t new, cryptocurrency has undoubtedly added new dimensions to it. Concepts like compounding interest or reinvesting dividends are also applied in the cryptocurrency market, creating an ecosystem where one can earn passively.Let us discuss various ways to earn passive income with Bitcoin. This article includes interest accounts, lending, mining, trading and liquidity pool.Bitcoin interest accountsKeeping Bitcoin in a cryptocurrency savings account is similar to having regular savings accounts. These accounts offer fixed interest on the crypto assets deposited. One may choose flexible savings plans, which allow the depositor to withdraw assets whenever they wish or fixed savings plans, where the assets remain deposited for a predetermined period.Interest rates are usually higher when one deposits funds for a fixed-term than in a regular savings account. The tenure for fixed term deposits is considerably less than that of conventional bank accounts. On some protocols, there is no minimum deposit requirement as well.One can also rope in a financial adviser to implement investment strategies like dollar-cost averaging (DCA). The strategy involves investing the same amount of BTC in a target security regularly over a definite period, lowering their average cost per share and bringing down the impact of volatility on their cryptocurrency holdings.Bitcoin lendingBitcoin lending occurs when anyone holding BTC lends the cryptocurrency to borrowers through a centralized, decentralized or peer-to-peer (P2P) platform. In return, the borrowers pay daily, weekly or monthly interest. The lending platform usually takes a fee for the service.The three factors influencing the earnings are the total value of Bitcoin being lent, the duration of the loan and the interest rate. Users need to trust a third party for the Bitcoin lending infrastructure and terms on centralized lending platforms. Most platforms require users to deposit their BTC with the lending platform. While this brings expert-level help to users, their Bitcoin lies in the custody of platforms.On the other hand, no intermediaries are involved in decentralized lending platforms. Smart contracts automate the lending process, setting aside any human role. Interest rates are finalized autonomously, and the contract is executed once the relevant conditions are met.On P2P platforms, users can define their individual terms. For example, they can determine the interest rate and the amount of Bitcoin they want to lend. The platform’s role is to provide the necessary infrastructure for completing the deal, and they usually take a fee for their services.Bitcoin miningMining enables one to attain a reward for using computing power to secure the Bitcoin network. Bitcoin is a proof-of-work (PoW) protocol that requires the network participants to solve an arbitrary mathematical puzzle to prevent any unauthorized person or even an insider with mala fide intentions from initiating any changes detrimental to the network.In earlier days, users mined Bitcoin on regular PCs and then on general-purpose mining rigs. With the growth of the network, however, the complexity of mining increased, and miners were forced to use specially manufactured mining equipment called application-specific integrated circuits (ASICs), which have integrated chips designed for mining.Miners could set up and maintain mining rigs to bring down their costs. Doing so, however, requires them to have the initial capital necessary along with some technical expertise as they need to maintain Bitcoin mining hardware. This has enabled people to mine Bitcoin without having to invest a great deal of money. Being part of a pool with a lot of computational power gives one a higher chance of generating a winning hash than miners who lack such advanced equipment. Bitcoin tradingAs is the case with all financial assets, the price of Bitcoin is influenced by the laws of supply and demand. Anyone holding BTC can take advantage of the inherent volatility of the cryptocurrency to make money with Bitcoin trading, either by going long or short. Going long refers to selling BTC when prices are going up while going short is the act of selling when prices are going down.To time the market precisely for making profits is practically impossible for anyone. The basic idea, when going long, however, is to buy BTC when one expects its price to go up and sell it later with a profit margin. For example, if BTC is trading at $20,000 and one guesses it could move to $25,000 or upward, they could buy Bitcoin or swap any other cryptocurrency with BTC, wait for the price to go up and then sell the cryptocurrency, making a clear profit of $5,000.A shorting strategy is usually implemented by traders when cryptocurrency prices go down. For instance, suppose the price is currently at $20,000, and the trader expects it to drop to $17,000. The trader may sell their BTC right away and later repurchase it when the prices get to the desired level, making a profit of $3,000. The shorting of Bitcoin can be done through its derivatives like futures and options. One could also participate in prediction markets for shorting Bitcoin.For simplifying trade and minimizing any chances of loss, exchanges allow one to place stop-limit orders. If the prices fall below a certain level, the system will execute the trade independently and limit the losses. To fully automate the trading of Bitcoin, one could use algorithmic trading. Pre-programmed trading instructions are issued based on time, volume and price. When the market triggers the set instructions by the trader, the software executes the orders. Bitcoin liquidity poolLiquidity pools, the lifeline of decentralized exchanges (DeXs), can also be a venue for anyone having BTC to make some passive earning. A Bitcoin liquidity pool refers to a digital pile of cryptocurrency locked in a smart contract, thus creating liquidity for quicker transactions.Users of various crypto platforms, called liquidity providers (LPs), are rewarded with a part of fees and incentives in exchange for the amount of liquidity they have supplied to the liquidity pool. They get paid in the form of LP tokens, which can be used across the decentralized finance (DeFi) ecosystem. UniSwap, SushiSwap and PancakeSwap are some popular DeFi exchanges.A liquidity pool has cryptocurrencies in pairs, such as BTC-USDT, ETH-USDC, etc. Here is an example to help understand how it works on SushiSwap, with one investing $5,000 in a BTC-USDC liquidity pool. The steps are:Keep tabs on the changing ecosystemAn ability to make passive income from Bitcoin enhances the value of one’s holdings. Investing in cryptocurrencies always has a risk quotient because of volatility. Still, a passive income enables one to make money steadily without active exposure to the sharp ups and downs in prices. Before deciding on how to make money with passive earning, one needs to do adequate research on expected returns, risk factors, etc.The cryptocurrency ecosystem is evolving, and new use cases for Bitcoin might emerge, making it imperative for one to keep a constant vigil on the emerging opportunities. Local regulatory sanctions are also an important aspect to consider. Cryptocurrencies, including Bitcoin, are under the watch of regulatory authorities, and one needs to be aware of what they approve and disapprove.Purchase a licence for this article. Powered by SharpShark.

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How to find NFT metadata on OpenSea and Rarible?

How to find NFT metadata on OpenSea and Rarible?

Uverejnil používateľ | sep 21, 2022 |

NFTs are a game-changing technology, providing ownership for digital assets and serving as certificates for holders or access keys for the underlying content, which could be music, movies, art, real estate, and a lot of other stuff. However, what makes nonfungible tokens (NFTs) useful in real terms is metadata. It may not be a buzzword exactly but it ensures the user is able to make out what the NFT is all about.Metadata is information about the content that an NFT represents. As large files cannot be stored on the blockchain for the simple reason that they become too expensive, NFTs, most of the time, just point to the files stored outside the blockchain. That said, only a few NFT artworks are stored on-chain.This article explains NFT metadata, what makes putting up content on blockchain impractical, and how to find NFT metadata on Opensea and Rarible. Let’s start with understanding what NFT metadata actually is.What is nonfungible token (NFT) metadata?An NFT refers to a specific digital asset that could be in the form of a JPEG, GIF or an MP4 file. Though the token itself is hosted on the blockchain, the file underneath is stored off-chain. NFT metadata points out specifications regarding that stored data. It might include information such as the NFT’s name, description of the NFT, transactional history, link to the hosted image, traits and more.As for the advantages of NFT metadata, it helps solution architects to set aside the technical issues when hosting large files on a chain. The preferred practice is to upload the link of the content to the blockchain while storing content on an HTTP URL on the current Internet or the InterPlanetary File System (IPFS). IPFS is a file-sharing peer-to-peer (P2P) network for storing and sharing data in a distributed file. The metadata serves as the input of the NFT smart contract one needs to deploy on the blockchain network.Metadata is specified in a standardized JavaScript Object Notation (JSON) format. Inside the smart contract, though, the information is stored as a Universal Resource Identifier (URI) as storing as a JSON is too demanding on resources. However, users can download NFT metadata at will.Why is metadata for off-chain data needed?The large size of images, audio and video content makes uploading it to the blockchain very expensive. For instance, if someone wanted to store one gigabyte of data on the Ethereum blockchain, it would cost an approximate equivalent of $35 million. If a movie of 160 odd minutes is stored on a blockchain, it might cost more than the expenses of making the film, i.e., $237 million.The URI string, as mentioned above, indicates a location where one can find the token’s JSON description. The relevant metadata stays as a permanent record on the blockchain, describing what the token represents.What Opensea and Rarible add to the NFT ecosystem?Huge demand for NFTs led to the need for marketplaces where users can create, transfer and monetize their assets. The marketplaces provide the tools for these activities, which are so crucial for keeping up the NFT movement. Topping the chart are Opensea and Rarible, two open platforms where anyone can mint and trade NFTs.OpenSea is the world’s first and largest marketplace for NFTs, enabling users to roll out their own NFT collections to sell on the platform. Simplifying the intricate processes required for managing and monetizing NFTs, OpenSea provides the infrastructure for minting, listing and trading NFTs. Initially built to support CryptoKitties, OpenSea has grown to become NFT participants’ go-to marketplace.Rarible is also a peer-to-peer (P2P) gateway into the NFT market, offering simple minting and trading features. Unlike OpenSea, Rarible deploys its native token, RARI, to govern the platform and enable holders of RARI to vote on critical decisions.How to view NFT metadata on OpenSea?Any seasoned trader will want to view NFT metadata on OpenSea to find out what the NFT is all about. Checking metadata on OpenSea is pretty simple. For ease of understanding, let us focus on finding metadata of NFTs based on Ethereum.The process is as follows:1. Open the NFT they want to get metadata for.2. Scroll down and click on the “Details” tab and click the link next to the contract address.3. In the Etherscan link that appears on the screen, then copy the contract address.4. The user now types api.opensea.io/asset/ in the URL text box and pastes the copied contract address after slash at the end of the URL, followed by the token ID mentioned in contract details.The metadata in JSON format appears on the screen. To find metadata of NFTs hosted on other blockchains, one uses a relevant blockchain explorer to get the contract address. For instance, if the NFT is hosted on the Solana blockchain, clicking the link next to “Contact Address” on the “Details” tab takes one to Solana explorer Solscan.io. One can then use the relevant API to get the metadata.How to find NFT metadata on Rarible?Like OpenSea, Rarible also offers a way to find information regarding metadata. To understand the process, let’s use a popular NFT based on the Ethereum blockchain called EXIO, the pilot who enters the atmosphere of a planet controlled by psychedelic consciousness. Here’s the process to find NFT metadata for EXIO on Rarible:1. On Rarible, the user opens the respective page of the NFT, such as EXIO, as shown in the image below.2. Scroll the screen downwards. Under the Details tab, click View on Etherscan.3. From the screen, click on the Token ID number in blue.4. The user will now be directed to a new page.  5. Copy the contract address. 6. To find metadata, plug in the following link in the given format.https://api.rarible.org/v0.1/items/ETHEREUM:Contract Address: Token idFor the given contract address, the link will behttps://api.rarible.org/v0.1/items/ETHEREUM:0x3D34D2A719C2666e603650858ac159D12e623B77:10029The metadata will appear on the screen.To find metadata of the NFTs hosted on blockchains other than Ethereum on Rarible, all one needs to do is replace Ethereum with another blockchain of their choice. In some cases, there is no token ID. Below are examples for each particular blockchain represented on Rarible:Take metadata into account when trading on OpenSea and RaribleMetadata helps users to focus on the ownership and tradability of NFTs, thus making the tokens applicable in a string of use cases like art, real estate, music, fashion, gaming, supply chain, luxury goods, ticket sales and more. Immediate access to this important data brings efficiency to real-world implementations of NFT technology. Active usage of metadata by the users will promote stability in the ecosystem, adding tremendous value to it.A big chunk of traders on platforms like OpenSea and Rarible tend to look at metadata as technical stuff and don’t bother to check it. However, any experienced trader would know how important it is to know about every possible stuff about the NFTs they are going to purchase. Both platforms provide users with simple ways to find metadata about the specific NFTs and ensure the tokens they buy are worth the deal.Purchase a licence for this article. Powered by SharpShark.

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