While ChatGPT-4 can’t compete with human auditors yet, OpenZeppelin noted it was not optimized to do so, and AI models trained for this purpose would likely be more accurate.
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Google Cloud Marketplace adds support for nine different blockchain APIs, including Bitcoin and Ethereum, through integration with layer-1 Oracle network Flare.
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All 191 UNI token holders voted in favor of the proposal to launch the DEX on Polygon’s zkEVM.
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Ethereum validators are now one step away from being able to unstake their Ether from the Beacon Chain.
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Ether (ETH), which is the second largest cryptocurrency in terms of market capitalization, is popular among cryptocurrency investors because of its native ETH token. However, its native Solidity programming language and Ethereum Virtual Machine (EVM) are instrumental in the adulation it receives from the developer community. In fact, the Ethereum blockchain continues to attract decentralized application (DApp) developers due to its flexibility, the vast range of developer tools available and the platform’s large user base.Forming the core of the blockchain’s architecture, the EVM is the program that executes its application code or smart contracts, as they are called, providing a run-time environment for them that runs on top of the Ethereum network. What’s more, the EVM is Turing-complete and can thus run any program coded in any programming language, thereby allowing developers to easily create custom smart contracts and DApps for the burgeoning Web3 space. In addition to these important functionalities, EVM has access to all nodes in the network, handles smart contracts execution and effectively handles all transactions on the Ethereum blockchain, making it one of the most powerful virtual machines in existence today.What is Ethereum Virtual Machine (EVM) and how does it work?Conceptualized in 2013 by programmer Vitalik Buterin, the Ethereum network owes its phenomenal success as the preferred blockchain for DApp developers to the Ethereum Virtual Machine (EVM) that was designed by Gavin Wood during his tenure at Ethereum. Written in C++ and using the LLVM Project compiler, EVM is a special state machine that operates continuously and whose immutable operations determine the state of each block in the Ethereum blockchain. The EVM not only governs what nodes can or cannot do to the distributed ledger maintained by the Ethereum blockchain but also defines the specific rules of changing state from block to block. The latter functionality is what enables the smart contract functionality that Ethereum has come to be known for.To understand what an Ethereum Virtual Machine does, one needs to look at each of the different functions it serves in ensuring the smooth operation of the Ethereum network. For every input that it receives, the EVM produces an output that is deterministic in nature and follows a mathematical function in the simplest sense. Operating like a stack machine that pushes transient values to and from a pushdown stack, the EVM has a depth of 1024 items, with each of them being a 256-bit word. It also maintains a temporary memory in the form of a byte array, which changes between two transactions on the Ethereum blockchain. Smart contract codes that have been compiled are executed by the EVM in the form of a collection of 140 standard opcodes, while other blockchain-specific stack operations are also implemented by it.Thus, the EVM has a machine state that is volatile by nature during the processing of any transaction and a global or world state that contains information regarding the different accounts maintained on the Ethereum blockchain. All actions are governed by the EVM code, which in itself has gone through several iterations since the launch of the Ethereum network in 2015, leading to the existence of different implementations of the EVM currently in use.In fact, the EVM is responsible for maintaining a level of abstraction between thousands of Ethereum nodes and the executing code, acting as a function that delivers consistent results without divulging many details to clients or nodes.What is the purpose of the Ethereum Virtual Machine (EVM)?The EVM has been reliably powering all applications running on the Ethereum network without any major downtime reported. For developers, the EVM acts as the overarching program that runs smaller executable programs which are known as smart contracts in Ethereum, while providing them the freedom to write these smart contracts in a variety of programming languages including Solidity, Vyper, Python and Yul, among others.Due to this flexibility offered by the EVM, the Ethereum blockchain has spawned thousands of DApps in the decentralized finance (DeFi) and nonfungible token (NFT) space. Each of these DApps and the smart contracts that they are made of are converted into bytecode that is fed into the EVM and distributed among all nodes in the Ethereum network. When a smart contract is deployed, the EVM is responsible for communicating with all nodes and effecting state changes when a consensus has been arrived at.It can be said that the EVM is inserted inside every Ethereum node to execute smart contracts using bytecode instead of the base programming language, thus isolating the physical host computer from the machine code on which Ethereum runs.Benefits of Ethereum Virtual Machine (EVM)On account of the way in which the EVM operates, developers can execute code without worrying about its impact on the rest of the network or the possibility of it playing truant with data or personal files hosted on any of the node computers. Additionally, they can run complex smart contracts on different computing environments with distributed consensus. This ensures that the failure of a single node does not have any negative impact on the running of the DApp or smart contract, since the EVM code remains the same across all nodes. Moreover, since account data is maintained at a global level in the EVM, developers find it perfect for writing custom smart contract code and creating distinct DApps that can access this global data set and produce reliable outputs. The sanctity of the outcome is what makes the EVM, in particular, and the Ethereum blockchain in general well-suited to the sustainable expansion of the DApps and smart contract Ethereum ecosystem. Add to this the library of standard codes available for developers to choose from, an increasing number of EVM-compatible layer-2 blockchains and a large number of potential EVM use cases possible, and it is easy to see why the EVM is the preferred platform for Web3 development.Drawbacks of Ethereum Virtual Machine (EVM)Despite the many advantages offered by the EVM, there are certain downsides that need to be considered by developers and entrepreneurs building on Ethereum. The most important of these is the high transaction fees or gas costs associated with running a smart contract on the Ethereum network. Paid in ETH, these fees vary depending on the complexity of the contract and the network congestion at the time of execution, making it imperative for developers and entrepreneurs to price their services accordingly. Additionally, since Solidity is the most preferred language for coding on the EVM, it does imply that developers need to have adequate experience with it and possess a modicum of technical expertise to create efficient smart contracts by using it. The latter is important since any additional computation requirement will lead to higher gas costs and ultimately prove detrimental to the project’s success. If developers choose to code using other languages, they need to be careful in resolving any inherent repetitions in the code since the EVM will proceed to compile them anyway. While upgrading smart contracts is possible at a later stage, it comes with security risks associated with creating an intermediary smart contract that references the address of the original smart contract.The future of EVMsNotwithstanding the revolutionary changes brought about by the EVM to the blockchain ecosystem, this technology for reading and executing code is being improved upon by a number of blockchain projects. With cross-chain interoperability being the most important aspect for developers, many EVM-compatible blockchains have propped up, with most offering lower gas and faster transaction speeds than the Ethereum protocol. As a result, these blockchains are now able to interact with Ethereum users seamlessly and are facilitating fund transfers to their own networks using blockchain bridges.However, with the Ethereum protocol successfully completing the Merge in September 2022, the next target is to shift from EVM to Ethereum WebAssembly (eWASM). Designed to be highly modular and platform-independent, eWASM is being touted as the next game-changer for the Ethereum protocol and could motivate other blockchains to employ this run-time environment for smart contracts as well. However, whether eWASMs will replace the EVM as the most trusted mechanism for smart contracts is a question that only time will answer.
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Polygon (MATIC) had a promising July, gaining an impressive 83% in 30 days. The smart contract platform uses layer-2 scaling and aims to become an essential Web3 infrastructure solution. However, investors question whether the recovery is sustainable, considering lackluster deposits and active addresses data.MATIC/USD on FTX. Source: TradingViewAccording to Cointelegraph, Polygon rallied after being selected for the Walt Disney Company’s accelerator program to build augmented reality, nonfungible token (NFT) and artificial intelligence solutions.Polygon announced on July 20 plans to implement a zero-knowledge Ethereum Virtual Machine (zkEVM), which bundles multiple transactions before relaying them to the Ethereum (ETH) blockchain. In a recent interview with Cointelegraph, Polygon co-founder Mihailo Bjelic stated this solution would slash Ethereum fees by 90% and boost throughput to 40–50 transactions per second.Another reason for Polygon’s rally was the growing number of platforms that started to offer liquid staking for MATIC tokens, which enabled holders to earn additional rewards. Examples include Lido Finance, Balancer, Meshswap and Ankr Staking, according to DeFi Pulse.Despite currently being 69% below its -time high, Polygon remains a top-12 token by capitalization rank. Moreover, the network holds $1.72 billion worth of deposits locked on smart contracts, known in the industry as total value locked, or TVL.Polygon’s Ethereum-compatible scaling is fully functional, hosting decentralized applications (DApps) that vary from decentralized exchanges (DEXs), collateralized loan services, yield aggregators, NFT marketplaces and games. Polygon smart contracts deposits dropped 42%Despite Polygon’s 83% rally in 30 days, the network’s TVL measured in MATIC tokens dropped by 42% in the same period. As a comparison, Fantom (FTM) scaling solution declined by 14% in 30 days and Klaytn (KLAY) increased by 11%.Polygon Total Value Locked, MATIC. Source: DefiLlamaIn dollar terms, Polygon’s current TVL of $1.42 billion is 67% lower year-to-date. Still, such a number is not distant from Solana’s (SOL) $2.08 billion, or Avalanche’s (AVAX) $2.52 billion, according to DeFi Llama data.To confirm whether Polygon’s TVL decline is caused by fading adoption, one should analyze DApp usage metrics. Nevertheless, some DApps, such as games and NFT marketplaces, do not require large deposits, so the TVL metric is irrelevant in those cases.Polygon DApps 30-day usage metrics. Source: DappRadarAs shown by DappRadar, on August 1, on average, the number of Polygon network addresses interacting with decentralized applications decreased by 19% versus the previous month.Considering Polygon’s TVL has declined by 42%, the network lacks a more substantial user base growth to support further MATIC token price momentum. Still, Quickswap, the leading DApp, presented 138,530 active addresses over the past 30 days. As a comparison, the leading Ethereum application OpenSea held 299,910 users in the same period.The above data suggest that Polygon has lost some of its traction in the market for scaling solutions. However, the project’s recently announced zero-knowledge is yet to be implemented, but its benefits could drive MATIC above $1.The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
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Bitcoin (BTC) is regaining its lost crypto market dominance even as it trades nearly 60% below its record highs.Bitcoin dominance at 6-month highsThe Bitcoin Market Dominance (BTC.D) index, a metric that weighs BTC’s market capitalization against the rest of the cryptocurrency market, jumped to around 47% on May 27, its highest since October 2021.Bitcoin Market Dominance daily chart. Source: TradingViewThe dominance index swelled despite the drop in Bitcoin’s market cap in the last six months from $1.3 trillion in November 2021 to nearly $550 billion in May 2022, suggesting that traders were more comfortable selling altcoins. Let’s look at three likely reasons why traders have been rotating out of the altcoin market to seek safety in Bitcoin.Ethereum “Merge” narrative is cooling downEthereum’s native token Ether (ETH), the largest alternative cryptocurrency by market cap, has witnessed consistent declines in its market dominance in the last five months—from 22.38% in December 2021 to 17.86% in May 2022.Ethereum Market Dominance daily chart. Source: TradingViewThe plunge comes after two years of a sustained uptrend, with ETH/BTC rising more than 200% between September 2019 and December 2021.As Cointelegraph reported, Ether outperformed Bitcoin in recent years, largely due to the hype surrounding its long-awaited protocol upgrade, called “the Merge,” which hopes to make Ethereum more scalable and less expensive.But the upgrade, which aims to transition Ethereum’s blockchain from proof-of-work to proof-of-stake—a counterpart known as Beacon Chain—has faced repeated delays in its launch. Only recently, Martin Köppelmann, the co-founder of the Ethereum Virtual Machine- (EVM)-compatible Gnosis chain, highlighted a seven-block reorganization on the Beacon Chain, meaning that the chain got briefly “forked” in its testing phase.The Ethereum beacon chain experienced a 7-block deep reorg ~2.5h ago. This shows that the current attestation strategy of nodes should be reconsidered to hopefully result in a more stable chain! (proposals already exist) pic.twitter.com/BkQrKuUlw1— Martin Köppelmann (@koeppelmann) May 25, 2022Ether dropped by nearly 13.5% against the U.S. dollar following the reveal on May 25 while ETH/BTC plunged to 0.059, the lowest in six months. ETH/BTC daily price chart featuring key support level. Source: TradingViewEthereum lacks narratives to drive ETH’s price upward after undergoing the Merge upgrade, noted OxHamZ, an independent market analyst, saying that investors have already “priced in” the network upgrade hype. What’s the narrative to own ETH after the merge?All KPIs are downActive wallets stagnantNFT hype deadLP trading volumes trending poorly Liquidity shrink in stablesL2 cannibalization growing (h/t @TaschaLabs)ETH is down 50% but the value of its block-space is also down— 0xHamZ (@0xHamz) May 25, 2022
LUNA to zeroBitcoin’s renewed crypto market strength also appears due to the Terra (LUNA) market’s collapse.LUNA/BTC, a financial instrument that traces the Terra token’s strength against Bitcoin, fell by 99.99% to 0.00000004 in May, which made it practically worthless. Meanwhile, LUNA declined similarly against the dollar, raising anticipations that traders dumped the token to seek safety in BTC and cash.LUNA/BTC daily price chart. Source: TradingViewLUNA’s market cap before the May’s deadly crash was $40.88 billion.Related: Crypto funds under management drop to a low not seen since July 2021Altszn ded On the whole, the altcoin market, containing everything from large-cap blockchain projects to sketchy crypto assets, has fallen by nearly 65% six months after topping out near $1.7 trillion.Altcoin market cap daily chart. Source: TradingViewA deeper look into some tokens shows that — unlike Bitcoin — most are down over 80% from their all-time highs, hinting at an overall investor exit from altcoins and into cash, stablecoins or BTC.DeFi projects and their downside retracement from record highs. Source: MessariSome dead crypto projects so far in 2022. Source: MessariThat is primarily because Bitcoin isn’t only the oldest blockchain, but stands on its own without any central authority.No one controls the #bitcoin network.— CZ Binance (@cz_binance) May 26, 2022
Historically, Bitcoin’s dominance drops during crypto bull markets as waves of new tokens spring up during the mania phase. For instance, the duration of the infamous initial coin offering (ICO) pump coincided with BTC.D dropping from nearly 96% in January 2017 to 35% in January 2018.BTC.D daily price chart. Source: TradingViewThen the March 2020 crash was the beginning of the DeFi and nonfungible token (NFT) hype, boosted further by the Federal Reserve’s quantitative easing. Therefore, if Bitcoin’s market dominance has indeed bottomed out, it could once again align with a macro bottom in Bitcoin price, and possibly the beginning of a new bull market phase in the coming months. The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
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Solana (SOL) price reached $143.50 on April 2 after an incredible 82% rally over a 20 day period. This positive performance can be attributed to recent NFT markets-related news and a marketwide bounce, but the current 22.7% decline could have investors confused. Solana/USDT at FTX. Source: TradingViewThe rally started after Coinbase Wallet added support for SOL and other Solana-based blockchain tokens on March 18. The crypto exchange also outlined plans to “further integrate” with Solana by connecting the Coinbase Wallet with the decentralized applications (DApps) and nonfungible tokens (NFTs) hosted on the network.The expectation of OpenSea’s integration of the Solana network also excited investors. This means Solana will join Ethereum, Polygon and Klaytn as the payment options visible in the drop-down “all chains” tab on OpenSea’s “rankings” page.Solana’s strategy to focus on NFT markets seems to have paid off because the layer-1 blockchain network has risen to third place all-time in total NFT sales on April 6. Moreover, the latest 30-day accumulated data shows Solana amassing $216 million worth of NFT sales.Solana’s DApp deposits are on the declineSolana’s primary decentralized application (DApp) metric started to display weakness in late March after the network’s total value locked (TVL) dropped below SOL 50 million.Solana network Total Value Locked, SOL. Source: DefiLlamaThe chart above shows how Solana’s DApp deposits saw a 30% decrease in three weeks as the indicator reached its lowest level since Sept. 20, 2021. As a comparison, Terra’s TVL increased by 34% year-to-date, while Fantom network deposits grew by 30%.On the bright side, on April 5, Neon released an alpha version for the first Solana Ethereum Virtual Machine (EVM) cross-compatibility and scaling solution and on April 7, Solana announced that over 1.6 million network addresses currently hold an NFT.A DeFi application stood out front the crowdTo confirm whether the TVL drop is concerning, one should analyze DApp usage metrics.Solana DApps 30-day on-chain data. Source: DappRadarAs shown by DappRadar data on April 8, the number of Solana network addresses interacting with decentralized applications increased by 11% on average. Orca, a user-friendly decentralized exchange (DEX), was the absolute highlight, amassing 153,290 users.Even though Solana’s TVL has been hit the hardest compared to similar smart contract platforms, there is solid network use on DeFi and NFT marketplaces, as measured by Magic Eden’s 212,230 active addresses in the last 30 days.The data above suggests that Solana investors should not worry about the most recent correction. The Solana ecosystem is fueled by the delivery of important milestones toward Ethereum compatibility and NFT market integrations and as long as this happens the potential for further price appreciation seems likely. The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
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Klaytn (KLAY) had a promising start in March 2021, reaching an impressive $11 billion market capitalization following its debut. However, investors have exaggerated their expectations as the token’s current total value stands at $3 billion, down roughly 70%.KLAY/USD on Binance. Source: TradingViewAlthough not as well known as the leading smart contract blockchains, Klaytn remains a top-35 token by capitalization rank. Moreover, the network holds $1.2 billion worth of deposits locked on smart contracts. Capital locked on smart contracts is known in the industry as total value locked, or TVL.Real use cases and strong backingKlaytn is a flexible modular network architecture created by Kakao, a publicly-traded South Korean internet giant. The Asian tech group’s shares are valued at $36 billion, backed by diverse applications in traditional markets, including games, chat, taxi and rides, financial services, and a venture arm.Businesses can customize and operate their own service-oriented blockchains built atop Klaytn architecture. These autonomously operated subnetworks are called Service Chains and are fully customizable. The network is fully functional, offering decentralized applications (dApp) ranging from DEX exchanges, nonfungible token (NFT) marketplaces, social networks, collateralized loans, and games. For instance, KlaySwap, Klaytn’s leading dApp, holds $746 million in TVL and 19,840 active addresses over the past week.According to Klaytn’s blog, the network is gearing up its infrastructure to provide services for the gaming and metaverse sectors. Initiatives include launching an open-source tools developer package that incorporates layer-2 solutions and adding direct support to Ethereum Virtual Machine (EVM) applications. Additional services include providing management and financial support for projects with high potential.Klaytn’s roadmap includes higher scalability by leveraging layer-2 service chains, additional interoperability bridges with other blockchains, and integrating an Interplanetary File System (IPFS) gateway for decentralized storage.Klaytn smart contracts deposits jumped 24%Despite KLAY’s negative 15% performance over the last 30 days, the network’s TVL increased by 24% in the same period. As a comparison, Arbitrum scaling solution stalled at $1.7 billion, and Polygon decreased to $3.35 billion from $4.65 billion on Feb. 15.Klaytn Total Value Locked, USD. Source: DefiLlamaIn dollar terms, Klaytn’s current TVL of $1.2 billion is 13% below its $1.35 billion peak in January 2022. Yet, these figures represent less than 2% of the aggregate TVL (excluding Ethereum), according to DeFi Llama data.In terms of recent developments, on Feb. 17, Klaytn joined the Blockchain Game Alliance, which encourages the development of standards and sharing of best practices in the decentralizing gaming sector. The initiative also aims to increase the public understanding and awareness of blockchain games.Related: Cointelegraph Research report analyzes GameFi’s bumper 2021 and trends for 2022To confirm whether Klaytn’s TVL growth is backed by increased adoption, one should analyze DApp usage metrics. Some DApps, such as games and collectibles, do not require large deposits, so the TVL metric is irrelevant in those cases.Klaytn DApps 30-day usage metrics. Source: DappRadarAs shown by DappRadar, on March 15 the number of Klaytn network addresses interacting with decentralized applications decreased by 5% versus the previous month.Even though Klaytn’s TVL has increased by 24%, the network lacks a more substantial user base growth to support further KLAY token price momentum. Still, KLAYswap, the leading Dapp, presented a decent 39,090 active addresses over the past 30 days.The above data suggests that Klaytn has found a niche within the decentralized application segment. If the project’s proposed features come to fruition, KLAY’s token price will likely hold $1.05 as medium-term support and present a decent upside.The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
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After a devastating 50% correction between Dec. 25 and Jan. 25, Polygon (MATIC) has been struggling to sustain the $1.40 support. While some argue this top-15 coin has merely adjusted after a 16,200% gain in 2021, others point to competing scaling solutions growth.MATIC token/USD at FTX. Source: TradingViewEither way, Polygon (MATIC) remains 50.8% below its all-time high at an $11 billion market capitalization. Currently, the market cap of Terra (LUNA) stands at $37 billion, Solana (SOL) is above $26 billion, and Avalanche (AVAX) is at a $19 billion market value.A positive note is that Polygon raised $450 million on Feb. 7, and the funding round was backed by some of blockchain’s most considerable venture funds, including Sequoia Capital.Polygon offers scaling and infrastructure support to Ethereum Virtual Machine-based (EVM) decentralized applications. Besides, it is not plagued by the high transaction fees and network congestion that impact the Ethereum network.However, as Proof-of-Stake layer-1 networks emerged and offered low-cost smart contract capabilities, it vastly increased the competition for Ethereum network decentralized finance (DeFi), non-fungible token minting, marketplaces, crypto games, gambling, and social applications.In comparison, Terra’s total value locked increased by 340% between July and December 2021, reaching $12.6 billion. Similarly, Avalanche’s smart contracts deposits increased from $185 million to $11.11 billion in the same period.The use of Polygon’s scaling solution is decliningPolygon’s primary DApp metric started to display weakness in August 2021 after the network‘s TVL dropped below 4 billion MATIC.Polygon Total Value Locked, MATIC. Source: DefiLlamaThe chart above shows how Polygon‘s DApp deposits peaked at 7.4 billion MATIC in July 2021, then drastically declined over the next couple of months. In dollar terms, the current $3.5 billion TVL is the lowest number since May 2021. These figures represent less than 5% of the aggregate TVL (excluding Ethereum), according to DefiLlama data.Another positive is that on March 9, Ankr, a multi-chain toolkit for blockchain infrastructure, enabled a token bridge between Ethereum and Polygon. The first release will allow the aMATICb liquid staking token to be sent and stored. This enables users to earn additional layers of rewards on DeFi platforms.To confirm whether the TVL drop in Polygon is troublesome, one should analyze DApp usage metrics. Some DApps such as games and collectibles do not require large deposits, so the TVL metric is irrelevant in those cases.Polygon DApps 30-day on-chain data. Source: DappRadarAs shown by DappRadar, on March 10 the number of Polygon network addresses interacting with decentralized applications grew by 5% versus the previous month. Even though Polygon’s TVL has been hit the hardest compared to similar smart contract platforms, there is solid network use in the gaming sector, as measured by Crazy Defense Heroes’ 199,260 active addresses in the last 30 days.On Nov. 16, Polygon launched its zk-STARK-powered Miden Virtual Machine, a zero-knowledge Scalable Transparent ARgument of Knowledge. Polygon has also committed over $1 billion for developing complex DeFi applications that need sensitive information redacted on digitized assets, reducing their size for fast verification by blockchain participants.The above data suggest that Polygon is holding ground versus competing chains, and those holders might not worry too much about MATIC’s 50% price correction. Polygon’s ecosystem continues to flourish, and the fact that it offers much demanded layer-2 scaling solutions for multiple industries can be viewed as a bullish factor.The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
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The phrase “hindsight is 20/20” is a perfect expression for financial markets because every price chart pattern and analysis is obvious after the movement has occurred.For example, traders playing the Feb. 28 pump that took Bitcoin (BTC) above $43,000 should have known that the price would face some resistance. Considering that the market had previously rejected at $44,500 on multiple instances, calling for a retest below $40,000 made perfect sense right?Bitcoin/USD at Coinbase. Source: TradingViewThis is a common fallacy, known as “post hoc,” in which one event is said to be the cause of a later event merely because it had occurred earlier. The truth is, one will always find analysts and pundits calling for continuation and rejection after a significant price move.Usually after strong #Bitcoin rallies like the one we just saw today, we tend to get follow through. As I said earlier, the sheer disbelief during this rally has me optimistic in the short-term. Still no guarantees of new highs immediately, but at least maybe a local uptrend.— Benjamin Cowen (@intocryptoverse) March 1, 2022Meanwhile, on March 2, Cointelegraph reported that Bitcoin “could force a $34K retest.” The analysis cited “ailing momentum” because Russia had just announced its invasion of Ukraine.In the past seven days, the aggregate market capitalization performance of the cryptocurrency market showed an 11.5% retrace to $1.76 trillion and this move erased the gains from the previous week. Large cap assets like Bitcoin, Ether (ETH) and Terra (LUNA) were equally impacted, reflecting nearly 12% losses in the period.Weekly winners and losers among the top-80 coins. Source: NomicsOnly two tokens were able to present positive performances over the past 7 days. WAVES rallied for the second consecutive week as the network upgrade to become Ethereum Virtual Machine (EVM) compatible advanced. The transition is scheduled to start in the spring and the new consensus mechanism will provide a “smoother transition to Waves 2.0.”THORChain (RUNE) jumped after completing its Terra (LUNA) ecosystem integration, enabling the blockchain to support all Cosmos-based projects. ThorChain users now have more trading and staking options available, including TerraUSD (UST) stablecoin.Funding rates flipped positive Perpetual contracts, also known as inverse swaps, have an embedded rate usually charged every eight hours. Perpetual futures are retail traders’ preferred derivatives because their price tends to track regular spot markets perfectly. Exchanges use this fee to avoid exchange risk imbalances. A positive funding rate indicates that longs (buyers) demand more leverage. However, the opposite situation occurs when shorts (sellers) require additional leverage, causing the funding rate to turn negative.Accumulated perpetual futures funding rate on March 7. Source: CoinglassNotice how the accumulated 7-day funding rate flipped positive in all of the top 4 coins. This data indicates slightly higher demand from longs (buyers) but is not yet significant. For example, Bitcoin’s positive 0.10% weekly rate equals 0.4% per month, which is not eventful for traders building futures’ positions.Typically, when there’s an imbalance caused by excessive optimism the rate can easily surpass 4.6% per month. Options data is pricing in a potential price crashCurrently, there is not any clear direction in the market, but the 25% delta options skew is a telling sign whenever market makers overcharge for upside or downside protection.If professional traders fear a Bitcoin price crash, the skew indicator will move above 10%. On the other hand, generalized excitement reflects a negative 10% skew.Bitcoin 30-day options 25% delta skew: Source: Laevitas.chAs displayed above, the skew indicator held 10% until March 4, but slightly reduced to 7% or 8% during the week. Despite this, the indicator shows that pro traders are pricing higher odds for a market crash.There are mixed feelings coming from retail traders’ futures data, which shows a shift moving away from a slightly negative sentiment versus options market makers pricing in a higher risk of a further crash.Some might say that the third failure to break the $44,500 resistance was the nail in the coffin because Bitcoin failed to display strength during a period of global macroeconomic uncertainty and strong commodities demand. On the other hand, the crypto sector’s current $1.76 trillion market capitalization can hardly be deemed unsuccessful, so there’s still hope for buyers.The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
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An experiment from Dragonfly Research that compared the performance of six blockchains by testing the capacity of Automated Market Makers on each has found Solana’s Orca DEX was the clear winner in trades per second. It managed 273.34 trades per second and created a new block every 590 milliseconds.Binance Smart Chain (BSC) wasn’t too far behind with 194.6 trades per second on PancakeSwap, followed by Polygon (MATIC), Avalanche (AVAX), Celo (CELO), and finally Ethereum (ETH).A blog post by researcher “GM” argued that while there was a rich ecosystem built on Ethereum Virtual Machine (EVM) compatible chains, the results showed “if you want really high performance now you have to look outside the EVM space.” A now deleted line in an earlier version of the post suggested users will eventually need to “abandon the EVM.”Dragonfly Research is the research arm of Dragonfly Capital and its portfolio page shows that it has invested in Celo, Avalanche, Cosmos, and Near, which is mentioned in the report. It has not invested in Solana. GM concluded that with time, other layer-1 blockchains will surpass EVM-compatible chains. He wrote:“Overall I come away with this impression: Ethereum is the MS-DOS of smart contract operating systems. But the current era of blockchains takes us into the Windows 95 era.”EVM chains are blockchains that are compatible with Ethereum tooling. They often aid in the scalability of the Ethereum network. The results of the experiment were published on Mar. 2. It was an attempt to compare blockchain throughput by measuring how many swaps could be made per block on native automated market makers (AMM). AMMs refer to decentralized exchanges (DEX) such as Uniswap and PancakeSwap that facilitate non-custodial token swaps on-chain.The basic question GM attempted to answer was: “If you filled an entire block with Uniswap V2-style trades, how many trades per second would clear?”Uniswap V2 was used as the benchmark given it is the dominant DEX with $1.6 billion in 7-day transaction volume. The benchmark was 18.38 transactions per second with 13.2 seconds per new block according to the report. Author GM noted that although it is not a perfect benchmark, it is “illustrative in getting a holistic view of performance.” The leading DEX on each blockchain tested was spammed with token swaps on the most liquid pairs to determine the current limit of their capacity. They did not test rollup scaling on layer one chains because rollups can be used on all chains.While the five EVM chains in the experiment could be tested the same way, Solana required a different methodology which GM wrote about in a subsequent blog post.AMM test to assess performance of blockchainsGM wrote that none of the blockchains in the test were being used to their full capacity and that he expects “all of the major L1s will improve in their performance over time.”Although the results of the report demonstrated Solana’s faster performance, proponents of decentralization point to other issues on Solana. The team from the Spookyswap DEX on Fantom Opera — which is EVM compatible — criticized the findings, telling Cointelegraph that Solana “is a completely centralized network unlike Ethereum.”Solana has also been plagued with service outages, which has raised concerns about the security of the network and the reliability of applications in the ecosystem. The Spookyswap team added“Solana can be turned off and has a history of going down for days. You do not see that with proper EVM layer 1 chains.”GM urged readers to “Do the math yourself” to confirm or refute the conclusions he has come to. He also noted that optimizations on blockchains happen very quickly, so with the introduction of a new optimization on any chain, the results may vary. Related: StarkNet now open for DApp deployment on Ethereum mainnetHe also concluded that there was only a maximum 25x performance difference between Ethereum and Solana, demonstrating that in general “nobody is getting that great performance” from linear token transactions on-chain.
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