Your Cryptocurrency Newsletter for 18 SEPTEMBER, 2020

If you are interested in cryptocurrencies, this newsletter is for you. [img]  [Learn more about RevenueStripe...](   [Learn more about RevenueStripe...]( [img]( [FeedBinary Newsletter]( [DEFI: Behind The Latest Revolution In CRYPTO]( To date, there have been several significant landmarks that have been achieved by cryptocurrency during its decade-long evolution into a legitimate asset class. US SEC (Securities and Exchange Commission) regulation, token sales and coin offerings, derivatives-market maturation and development of government and central-bank digital currencies are just some of the most significant of those milestones. But as far as 2020 is concerned, it is the DeFi revolution that has taken the space by storm. As is often the case with crypto, this has meant that we have seen astronomical gains in the price of several tokens belonging to DeFi projects. The non-custodial, decentralised derivatives exchange Serum, for example, experienced a monumental 1,500-percent price surge in just the 24 hours after its token launch on August 11. And, as such, DeFi markets are now showing explosive growth in terms of the total value locked in them. According to analytics hub DeFi Pulse, more than $8.5 billion was locked up in DeFi contracts at the beginning of September, compared with the mere $1,000 or so that was tied up 12 months ago. And even by April of this year, only $650 million had been committed, demonstrating just how steep the interest in DeFi projects has been in recent months. [defi latest revolution in crypto] But what exactly is DeFi? And why has interest in this space exploded all of a sudden? DeFi refers to decentralised finance—that is, the application of financial services using decentralised technology such as blockchain. DeFi projects aim to provide financial services that do not require centralised entities or financial intermediaries or middlemen to operate. At present, “trust” within the global financial system is largely represented by systemically important financial institutions and regulatory bodies. Have they been successful in instilling sufficient trust? That’s debatable at best. Errors, delays and security vulnerabilities have certainly not been infrequent. Nor have these entities been shy when it has come to taking their own pieces of the pie in exchange for providing this purported layer of trust. And what’s more, there have been depressingly few signs over the years and decades of their willingness to be more innovative, cost-effective or efficient. It is with such limitations in mind that the DeFi revolution has gathered steam. DeFi is about creating a network of financial services that seamlessly function without the need for intermediaries that could hold an unfair and inefficient controlling stake in the operation of the system. “The simplest way to describe DeFi is as an open financial network,” Peter Johnson, ex-Morgan Stanley banker and now a partner at fintech (financial technology) venture-capital firm Jump Capital, recently told Fortunemagazine. “If you want to send, lend or borrow money, you don’t need to join a private network like PayPal or Fedwire or a bank.” And they are already running virtually the entire gamut of possible financial services, including payments, savings, lending and borrowing, insurance and financial-market trading and investing. A user will typically set up an online wallet, such as MetaMask, that contains the user’s funds and remains strictly under the user’s control at all times. The wallet provides a gateway for the user to access dApps and gain exposure to various financial services. The decentralised technology that underpins this new infrastructure eliminates the need for the involvement, approval and permission of a middleman, as is currently the case with banks operating under a centralised architecture. Instead, smart contracts facilitate the execution and completion of direct transactions between the two parties. The decentralised applications that run on these smart contracts, or dApps, facilitate this direct, peer-to-peer financial environment. They enable users to directly access a whole host of financial services, while the responsibilities that are normally conducted by the intermediary in a centralised system are instead stipulated by the code that is written into the smart contracts. Payments, for example, represent a hefty chunk of these dApps, with smart contracts enabling the sending of value from one party to another in a secure and transparent manner whilst providing a clear set of governance rules that cannot be changed. Among specific dApps that have facilitated the boom is Compound (COMP), a decentralised lending facility—the smart contracts of which have been developed on the Ethereum blockchain platform. It allows anyone to lend or borrow crypto-assets through a decentralised market. Those who supply their assets to Compound’s liquidity pool earn interest on the amounts they lend, with the source of the interest originating from those users who borrow from the pool and who thus pay interest for doing so. The respective interest rates paid by borrowers and earnt by lenders are determined by the supply and demand of each token that exists in Compound’s liquidity pool at any given time. The project managed to garner considerable attention when back in June it launched its token, which soon became available through renowned crypto-exchange Coinbase. Those who provide liquidity to the Compound protocol can earn COMP tokens as a reward. But what sets this particular DeFi project apart is that it issues cTokens to suppliers in exchange for the funds they deposit; for example, cETH tokens in exchange for ETH (ether) or cUSDC in exchange for USDC (USD Coin). These tokens function as collateral for loans, which effectively enables users to spend funds whilst they continue to earn interest. And at any time, the user can redeem cTokens for the normal token plus the interest earned. But what exactly has been driving this recent DeFi buzz? In short, “yield farming”. As protocols such as Compound demonstrate, generating high-yield income is among the most popular activities within the DeFi space at present, with users depositing their token holdings to earn a significantly higher rate of return than they would with a typical savings account. Yield farming itself involves moving money around various markets to ensure the user earns the highest possible rate of return. This may involve exposure to riskier pools, but the higher yield offered on such assets represents compensation for this risk. The real benefit from yield farming now seems to come from users engaging in arbitrage by lending to and borrowing from the same protocol to earn risk-free returns. What’s more, returns from yield farming can be significantly bolstered by “liquidity mining”, whereby a yield farmer also receives a token in addition to the rate of return in exchange for providing liquidity. “The idea is that stimulating usage of the platform increases the value of the token, thereby creating a positive usage loop to attract users,” noted Richard Ma of smart-contract auditor Quantstamp. But those higher interest rates, of course, represent taking on a higher degree of risk. And DeFi invariably represents a much higher risk prospect than the traditional financial sector. “Honestly I think we emphasize flashy DeFi things that give you fancy high interest rates way too much,” Ethereum co-founder Vitalik Buterin tweeted in June. “Interest rates significantly higher than what you can get in traditional finance are inherently either temporary arbitrage opportunities or come with unstated risks attached.” And the fact that the interest rate can at times fluctuate wildly means there is not much chance that users can accurately determine how much they will earn over the course of longer periods. There is also little in the way of a standardised regulatory framework thus far. Entities such as the Federal Deposit Insurance Corporation (FDIC), the US agency that provides insurance to depositors, are not there to protect users in DeFi applications such as Compound. And if there is a risk of failure that prompts a flight to safety by users, some may end up being unable to withdraw their funds. And DeFi protocols such as decentralised exchanges (DEXes) can be susceptible to the nefarious practice of front-running, whereby miners suitably position their buy and sell orders ahead of much bigger customer orders to extract profit. As a Cornell University paper found last year, there is widespread and rising deployment of arbitrage bots in blockchain systems, specifically in decentralized exchanges. “Like high-frequency traders on Wall Street, these bots exploit inefficiencies in DEXes, paying high transaction fees and optimizing network latency to frontrun, i.e., anticipate and exploit, ordinary users’ DEX trades,” noted the authors. “We observe bots engage in what we call priority gas auctions (PGAs), competitively bidding up transaction fees in order to obtain priority ordering, i.e., early block position and execution, for their transactions.” Nonetheless, as it stands, DeFi already represents a major breakthrough in the world of financial services. It is reinventing the way ordinary people can conduct their financial affairs and is providing an increasingly robust alternative to traditional financial systems. Perhaps most exciting of all is the opportunity for a much wider population to access a multitude of financial services. Anyone with a smartphone and an internet connection can gain exposure to DeFi services, which in turn means that they represent a significant step on the path towards the complete democratization of finance throughout the world. [Read Full News]( The post [DEFI: Behind The Latest Revolution In CRYPTO]( first appeared on [Feed Binary](. [Read Full Story]( ------------------ You Might Like     [Learn more about RevenueStripe...]( ------------------ [Bitcoin Campaign Contributions Are Getting More Mainstream]( Once considered the donation method for fringe supporters, cryptocurrency seems to be getting more popular in the broader political arena. Some, however, worry the digital currency is a way to skirt campaign finance laws. TNS Somewhere among the hundreds of supporters who have contributed a stunning $1.1 million to the congressional campaign of self-proclaimed Islamophobe Laura Loomer are the donors backing the 27-year-old newcomer not with dollars but with a cryptocurrency called Bitcoin. Until recently, digital assets like Bitcoins were the preferred currency of far-right conservatives and die-hard libertarians. The attraction? Cryptocurrencies provide anonymity and the opportunity to snub banks and governments, which have no power over cryptocurrencies because they do not recognize them as legal tender. The option to contribute to campaigns using Bitcoin has been primarily offered by candidates, like Loomer, who appealed to the Libertarian and far-right demographic. “Bitcoin promotes financial freedom,” said Loomer, who said she owns cryptocurrency. “We are telling the old power structure that we don’t need them anymore. We pave our own destiny financially, intellectually and with speech freedoms.” But with more fringe candidates stepping into the political arena this election cycle and mainstream, tech-savvy candidates wanting to appear hip to the crypto crowd, donations via the controversial currency are now being accepted by candidates on both sides of the aisle. Democratic presidential hopefuls Andrew Yang and California U.S. Rep. Eric Swalwell both accepted Bitcoin contributions before they each dropped out of the race. The campaign of Minnesota U.S. Rep. Tom Emmer, chairman of the National Republican Congressional Committee and member of the Congressional Blockchain Caucus, is also accepting cryptocurrency contributions. “Embracing cryptocurrency signals to those who hold it that your campaign is open-minded, forward-thinking, and up to speed on how consumers are transacting in their daily lives,” said Perianne Boring, founder and chairman of the Chamber of Digital Commerce. “It also demonstrates a strong commitment to innovation and its impact on the economy, national security and American leadership.” Others see cryptocurrency donations as a political stunt and a tool that makes it easier for bad actors to do an end run around campaign finance laws. “I see Bitcoin often as more of a gimmick,” said Daniel Weiner, the deputy director of election reform at the Brennan Center for Justice. “The danger with Bitcoin in this realm is that it is essentially designed for anonymity and when we talk about campaign contributions the most important thing is they be disclosed.” The U.S. Department of the Treasury this month sanctioned three employees of the Russian troll factory known as the Internet Research Agency, or IRA, for their support of the IRA’s cryptocurrency accounts. The IRA uses cryptocurrency to sow discord between political parties as part of Moscow’s broader efforts to undermine democratic countries and institutions, according to the department. WHAT IS BITCOIN? Bitcoin was invented in 2009 by an unknown person or group of people using the name Satoshi Nakamoto. The currency is strictly digital and has no physical form — no coins or bills. It also is not regulated by any financial institution or government — meaning transactions are made peer-to-peer, also known as P2P, without going through a third party, like a bank or payment processor such as Paypal. Users of Bitcoin don’t identify themselves with their real names. Instead, they use Bitcoin addresses, seemingly random strings of numbers and letters, and pseudonyms. Bitcoin transactions are recorded in a public, digital ledger called a blockchain. Despite there being a verified record of the transaction in the blockchain, the parties can remain anonymous because they are identified only by their Bitcoin address or pseudonym in the blockchain. No bank, payment processors or government agency has a record of the transaction. That has made Bitcoin donations popular not only with libertarians who oppose any government interference in their lives but also money launderers, fraudsters and foreign political operatives seeking to covertly dump illegal amounts of cash into campaign coffers. Recognizing Bitcoin’s potential for fraud in campaigns, and that cryptocurrency donations cannot be easily inspected by the public, the Federal Elections Commission issued an advisory opinion in 2014 with instructions on reporting cryptocurrency donations. Under the opinion, cryptocurrency donations must be reported as in-kind contributions, like reporting the value of pizzas that a donor purchases for a campaign event. But while the value of the donated pizza will not change, Bitcoin valuations can be wildly volatile. The value of a single bitcoin in March dropped to $5,800. By Sept. 15, a Bitcoin had a market value of $10,785. So, the fraction of a bitcoin donated today may be below the $2,800 individual contribution limit but above the limit on the day the campaign report is filed. The FEC addressed that problem by requiring bitcoin contributions be valued on the day they are given. Loomer said she avoids that dilemma by immediately converting all bitcoin donations to cash. “I think there is a lot of fake news about Bitcoin,” said Loomer. “It’s disingenuous to say it’s any different than accepting cash.” Bitcoin donations can only be accepted after donors provide their names, addresses, employers and affirm that they own the bitcoins and that they are U.S. citizens. As with all donations, the campaign treasurer is responsible for ensuring transactions are legal and that when the contributions are added to others by the same donor, do not exceed contribution limits. “There is little difference in the fraud risk of accepting cryptocurrency versus the risk of accepting credit card donations online,” said Boring. As for fraud concerns, 15 percent of adults in the U.S. own some form of cryptocurrency and at least one-third of U.S. small and medium-sized businesses accept cryptocurrency as payment, Boring said. Just because a donor uses Bitcoin rather than cash does not mean the donor is trying to hide something, Boring added. “Many donors prefer to donate cryptocurrency because they want to support the growth of cryptocurrencies as a medium of exchange and transfer,” Boring said. “Cryptocurrency holders are passionate about this emerging technology and they are eager to support and encourage candidates who accept cryptocurrencies.” Loomer said she got interested in cryptocurrency several years ago. That was about the time she was kicked off Twitter, Facebook, Instagram, Uber, Lyft, Medium and other sites and services for her use of hate speech. Loomer also lost the ability to transfer money when third party money processsors, like PayPal, GoFundMe and Venmo also banned her. “I’m proud I am one of the only candidates in the nation that accepts bitcoin donations,” said Loomer, the Republican candidate challenging the longtime Democratic incumbent, Lois Frankel. Loomer said she had not received many bitcoin contributions but she did not respond to a request for information about the number and amount of Bitcoin donations that her campaign has collected. Campaign finance rules require donors be identified only if their cumulative donations to a candidate exceed $200. Most of Loomer’s donations fall into that category. While some candidates identify all donors regardless how small the donation, Loomer has chosen not to do so. How widespread cryptocurrency donations are in federal and state races across the country is hard to calculate. An investigation by the Center for Public Integrity published in 2018 found 20 candidates running for all levels of office who solicited or had received cryptocurrency donations. The Center for Public Integrity found federal election records revealed eight candidates who had raised cryptocurrency contributions worth at least $550,000 since 2014. The cryptocurrency rules that apply to candidates for federal offices do not necessarily apply to candidates in state races. According to the Center for Public Integrity, in 2018, at least eight states and the District of Columbia have created their own limitations or added instructions about cryptocurrency donations in their election manuals. At least seven others state have banned cryptocurrency contributions altogether. As for Florida, there is no mention of cryptocurrency transactions in campaign manuals or the statute governing campaigns. The state Division of Elections did not respond to repeated requests about whether Florida regulates cryptocurrency use in campaigns. [Read Full Newsletter]( The post [Bitcoin Campaign Contributions Are Getting More Mainstream]( first appeared on [Feed Binary](. [Read Full Story]( ------------------ You Might Like     [Learn more about RevenueStripe...]( ------------------ [Bitcoin, Tesla and Avocados: Millennial Traders are Saying ‘OK Boomer’]( Tesla, Bitcoin and avocados have all risen in tandem in recent weeks as trading activity spikes among millennials. the price of Bitcoin (BTC) rose by over 11%. Similarly, in the same period, Tesla stock (TSLA) surged from $330.21 to $449.76, by 36.2%. Millennials love TSLA stock and Bitcoin Tesla stock and the Bitcoin price have seen an uncanny correlation in recent weeks. The correlation might come from the similarities between BTC price movements and the S&P 500. It also might be related to the fact that millennial traders actively trade both BTC and TSLA. [bitcoin tesla and avocados] Tesla stock neared its all-time high when Bitcoin surged above $11,000 The day the price of Bitcoin spiked above $11,000 across major cryptocurrency exchanges, Tesla stock price neared its record high.TESLA slumped since early September after the Financial Times unmasked SoftBank as the Nasdaq whale. Following the report, a market-wide sell-off continued with the Nasdaq falling by 10% in six days. But after the initial drop, the U.S. stock market began to recover and the Tesla stock price rebounded. Coincidentally, Bitcoin rose from $10,300 to $11,100 at the same time. The avo-ning Another asset that has seen some correlation with the price of Bitcoin is avocados. The spot price of Mexico City Hass Avocado from Michoacan has moved similar to BTC since June 2018. One similarity between Bitcoin, avocados and Tesla is that the three are liked by retail traders and millennials, in particular. [bitmax trading view] On Jul. 14, for instance, Bloomberg reported that 10,000 day-traders on Robinhood bought Tesla shares in a single hour at the day’s peak. Major market data providers are also noticing some similarities between Tesla and Bitcoin. As Cointelegraph reported, TradingView said Tesla and Bitcoin were the most viewed assets in July, as the demand for day trading soared.The demand for avocados rose in recent months as well alongside Bitcoin and Tesla, according to avocado suppliers. Axarfruit’s manager Álvaro Martínez said:“The truth is that, during the first months of the pandemic, the demand went crazy and we were overwhelmed with orders. Then, with the massive arrival of Peruvian avocados, prices dropped, as the Andean country shipped smaller volumes to the United States due to it being well supplied by California and Mexico. The drop in prices gave a boost to the demand, which has been higher than in the same period of previous years.” [bitcoin community engagement] Where does Bitcoin go from here? In the short term, traders expect either another test of $10,110 or a breakdown to $10,200. The Tesla stock price has dropped 2.55% in pre-market trading and it remains to be seen if it would coincide with a BTC price movement once again. As TSLA stock dipped overnight, the price of Bitcoin dropped from $11,000 to $10,800, recording a 2.5% pullback. Michael van de Poppe, a full-time trader at the Amsterdam Stock Exchange, said BTC is at a crucial resistance. He said:“The levels I’m watching on $BTC are structured here. The short term still trending upwards, but on a crucial resistance to break. If $10,750 fails to hold, $10,600 is next, and most likely the area around $10,200. If $10,750 holds, another test of $11,100 seems likely.” [Read Full News]( The post [Bitcoin, Tesla and Avocados: Millennial Traders are Saying ‘OK Boomer’]( first appeared on [Feed Binary](. [Read Full Story]( ------------------ You Might Like     [Learn more about RevenueStripe...]( ------------------ ------------------ Connect with TheFeedBinary on Facebook and Twitter [fb](  [tw]( ------------------ You received this email because you operate or create content for a website/service and based on your website it seemed like this could be important information to you and your users. FeedBinary daily newsletter is managed by [Postbox Consultancy Services Pvt. Ltd.]( C-4/5, IBD Emporia, Kolar Road, Bhopal, Madhya Pradesh, INDIA, 462042 Want to change how you receive these emails? [Update your preferences]( or [Unsubscribe](