Argo Blockchain lanserar en pool för ren energi för Bitcoin-gruvdrift

Vattenkraft kommer att driva en ny Bitcoin mining pool efter Argos partnerskap med DMG Blockchain.

En gruvpool för Bitcoin som enbart drivs av ren energi

Det börsnoterade gruvföretaget Argo Blockchain kommer att lansera en gruvpool för Bitcoin (BTC) som enbart drivs av ren energi, meddelade företaget den 26 mars.

Argo har samarbetat med det miljövänliga gruvföretaget DMG Blockchain för att skapa Terra Pool – en Bitcoin gruvpool som består av en hash-hastighet som härrör från båda företagens vattenkraftkällor, som företaget hävdar är den första i sitt slag.

Argo Blockchain PLC är ett brittiskt gruvföretag med tre operativa anläggningar i Kanada för brytning av Bitcoin och det privata myntet Zcash (ZEC). Företaget förvärvade nyligen en 320 hektar stor tomt i Texas, som det planerar att använda för att utöka sin gruvdrift med ytterligare 200 megawatt elkraft, som också kommer från förnybara energikällor.

Mer grönt och uppmanade andra Bitcoin

Argos verkställande direktör Peter Wall sade att det var en viktig prioritering att göra Bitcoin mer grönt och uppmanade andra Bitcoin-gruvföretag att följa efter:

„Att ta itu med klimatförändringarna är en prioritet för Argo och att samarbeta med DMG för att skapa den första „gröna“ Bitcoin mining pool är ett viktigt steg mot att skydda vår planet nu och för kommande generationer. Vi hoppas att andra företag inom Bitcoin mining industrin följer i våra fotspår för att visa på en bredare klimatmedvetenhet.“

Bitcoins energianvändning ökade för att matcha den årliga förbrukningen i landet Chile förra månaden, ett faktum som kritiker och skeptiker är snabba att påpeka. Det är dock få som tänker på att rikta samma kritik mot en teknik som internet, som redan använder mer energi än Bitcoin, och som liksom kryptovalutor ännu inte har expanderat till något som är i närheten av global användning.

„[DMG:s] fokus på miljövänlig Bitcoin-gruvdrift har möjlighet att driva förändringar i hur Bitcoin-gruvdriftsgemenskapen agerar mot en klimatmedveten framtid. DMG:s pågående engagemang för ren energibaserad kapitalanvändning är en viktig branschutveckling“, säger DMG:s verkställande direktör Dan Reitzik.

Cardano nähert sich einem neuen großen Upgrade, als ADA eine inspirierte Rallye veröffentlicht

Cardanos Mary-Upgrade und Token-Gewinne stehen kurz davor, mit Ethereum zu konkurrieren, während Metriken darauf hindeuten, dass Ethereum immer noch König ist.

Die ADA -Münze der Cardano Foundation erreichte am 12. Februar ihr Allzeithoch von 0,97 USD, nachdem das Jahr mit 0,18 USD begonnen hatte, was einem Gewinn von 438% seit Jahresbeginn entspricht

Abgesehen von den Makrotrends in der Kryptowährungsbranche, die den Preis für Flaggschiff-Assets wie Bitcoin ( BTC ) und Ether ( ETH ) in andere Altcoins wie LINK, DOT usw. in die Höhe treiben, könnte das Wachstum von Cardano auch auf die Netzwerkaktualisierungen, die Cardano in seinem Blockchain-Netzwerk ausgeführt hat.

Am 3. Februar führte Cardanos Entwicklungsfirma Input Output Hong Kong erfolgreich eine harte Gabelung durch und wandte das native Goguen-Token-Upgrade, das als Mary-Upgrade bekannt ist, auf Cardanos Testnetz an, das die Blockchain in ein Multi-Asset-Netzwerk ähnlich Ethereum verwandelt.

Das Team erwartet, das Mainnet bis Ende Februar zu starten. Die anderen Funktionen des Goguen-Updates werden entsprechend den verschiedenen Phasen der Cardano-Roadmap gleichzeitig eingeführt.

In Bezug auf die Funktionalität würde dieses Upgrade die nativen Token von Cardano mit den fungiblen ERC-20-Token und den nicht fungiblen ERC-721-Token auf Ethereum gleichsetzen. Zum ersten Mal können Benutzer in der Cardano-Blockchain ihre eigenen Token erstellen, sei es fungible Token oder NFTs. Zusätzlich zu diesen Ähnlichkeiten mit der Ethereum-Blockchain gibt es Designunterschiede zwischen Cardanos nativen Token im Vergleich zu Ethereum-Token.

Cardanos Token-Design-Unterschied ist ein Alleinstellungsmerkmal?

Der erste große Unterschied nach dem Upgrade besteht darin, dass keine Ausführungsgebühren anfallen, die normalerweise einem Benutzer in Rechnung gestellt werden, wenn er mit einem Token-Smart-Vertrag in der Ethereum-Blockchain interagiert, der als Gasgebühren bezeichnet wird.

Die jüngsten Bullenläufe in Ether- und anderen Ethereum-Blockchain-Token haben aufgrund der Überlastung des Netzwerks zu extrem hohen Gasgebühren geführt und Privatanleger davon abgehalten, sich zu engagieren. Hinrich Pfeifer, Generalsekretär der Cardano Foundation, diskutierte mit Cointelegraph, wie sich die einheimischen Token von Cardano in diesem Aspekt unterscheiden würden: „Einheimische Token auf Cardano werden in der Kette ‚geschmiedet‘, ohne dass ein intelligenter Vertrag erforderlich ist, und daher wird keine Ausführungsgebühr erhoben erforderlich, um native Token auf Cardano zu tätigen. “ Er fügte hinzu:

„Stattdessen erfordert das Senden von Token eine nominelle Gebühr (als ‚Min-Ada-Wert‘ bezeichnet), die in ADA zu zahlen ist und neben den Token gesendet werden muss. Sie können auch mehrere native Token zusammen bündeln und in einer Transaktion zusammen senden (dies erhöht den ‚min-ADA-Wert‘). Diese Gebühr hängt jedoch nicht von einer Überlastung des Netzwerks oder von einer intelligenten Vertragsabwicklung ab. “

Das Fehlen gefälschter Verträge zum Fälschen von Token würde zu weiteren Vorteilen führen, da Betrüger keinen Spielraum hätten, um Sicherheitslücken bei intelligenten Verträgen, menschliches Versagen und andere mit intelligenten Verträgen verbundene Risiken auszunutzen – etwas, vor dem Ethereum-Mitbegründer Vitalik Buterin die Community zuletzt gewarnt hat Jahr.

Le ragioni intangibili per cui Ethereum e Bitcoin

Le ragioni intangibili per cui Ethereum e Bitcoin sono leader

Nello sviluppo open-source, dove c’è poca proprietà intellettuale privilegiata, gli intangibili come il marchio e la comunità contano di più.

La finanza decentralizzata (DeFi) sta esplodendo. La quantità di capitale bloccato in DeFi, una misura imperfetta ma utile di trazione, ha recentemente colpito un massimo storico di 35 miliardi di dollari.

Oggi, Ethereum è la rete dominante per la DeFi in tutte le metriche Bitcoin Trader importanti, compresi i flussi di capitale, il capitale bloccato, il numero di progetti e sviluppatori.

Alex è co-fondatore di Zabo, una piattaforma che consente alle fintech e alle società di servizi finanziari di collegare facilmente i conti in criptovaluta alle loro applicazioni.

La crescita esplosiva di DeFi ha alimentato una battaglia già feroce tra le piattaforme di contratti intelligenti, alias „Ethereum-killer“, per conquistare quote della categoria emergente.

Tushar Jain, partner della società di venture crypto Multicoin Capital, ha recentemente fatto commenti su Twitter chiamando in causa il dominio DeFi di Ethereum:

La visione di Jain è tenuta da molti investitori intelligenti e può essere riassunta come: alla fine le reti più performanti, meglio progettate e meno costose inizieranno a mangiare la quota di mercato DeFi di Ethereum.
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In effetti, gli investitori hanno versato miliardi in piattaforme di contratti intelligenti concorrenti a sostegno di questa esatta tesi.

Eppure, nonostante il lancio di molte piattaforme concorrenti e l’impiego di grandi quantità di capitale nei loro sforzi, gli effetti di rete e il fossato di Ethereum sono inspiegabilmente forti come sempre. Come è possibile?

È possibile perché Ethereum ha potenti beni immateriali che sono incredibilmente difficili da riprodurre e contro cui competere.

Questa non è una nuova dinamica – il dominio immateriale è stato a lungo osservato e ha avuto un impatto anche sui mercati e sulle aziende tradizionali.

Coca-Cola, Google e … Ethereum?

Si possono generalmente dividere i beni in due categorie: tangibili e intangibili.

I beni tangibili sono di natura fisica – cose come denaro, attrezzature e server. Per le reti di computer, un bene tangibile potrebbe includere quanta potenza di calcolo può essere fornita o quanto velocemente una query può essere eseguita – cose basate su proprietà fisiche sottostanti della rete. Data la natura fisica dei beni tangibili, sono abbastanza facili da quantificare e misurare.

Al contrario, i beni intangibili non esistono in forma fisica – come la proprietà intellettuale, il riconoscimento del marchio e la fiducia. Gli asset intangibili possono essere molto difficili da quantificare, rendendo più difficile individuare la loro influenza sui risultati finali come i guadagni o il numero di connessioni in una rete. I beni immateriali possono anche essere incredibilmente difficili da replicare, perché la loro creazione spesso si basa su qualcosa di molto più complesso, come i pensieri di un cervello umano.

Gli investitori sanno da tempo che le aziende di successo hanno forti qualità intangibili che danno loro la capacità di accumulare un valore fuori misura e rimanere altamente competitive per lunghi periodi.

Consideriamo un’azienda come la Coca-Cola. Immaginate di creare una cola che abbia un sapore ancora migliore della Coca-Cola („più performante“) e di fornire abbastanza capitale per costruire una migliore rete di distribuzione mondiale per rivaleggiare con quella della Coca-Cola („più scalabile“ e „meno costosa“).

„Gli investitori sanno da tempo che le aziende di successo hanno forti qualità intangibili che danno loro la capacità di accumulare un valore fuori misura“.

Questo permetterebbe di convincere la maggior parte dei bevitori di cola esistenti e nuovi a fare il cambio di Coca Cola?

Probabilmente no.

I beni tangibili della Coca-Cola – gli ingredienti grezzi che compongono il gusto, la confezione e la distribuzione della Coca-Cola – non sono quelli che assicurano da soli la posizione dominante dell’azienda sul mercato. Coca-Cola è dominante oggi a causa dei beni intangibili: la sua consapevolezza universale del marchio, la fedeltà dei clienti e il modo in cui fa sentire la gente. Questi sono incredibilmente difficili da riprodurre.

Eppure, Coca Cola è un marchio di consumo. E la tecnologia? Anche lì troviamo la stessa tendenza.

Binance Sponsors New DeFi Accelerator With Blockchain Company Orbs

Binance will sponsor a new DeFi project accelerator program.

Sponsorships and grants will be awarded to selected projects.

Binance continues to launch tokens running on its own blockchain, called Smart Chain.

The Binance cryptocurrency exchange is increasingly immersing itself in the decentralized finance (DeFi) industry. Its latest foray thus took the form of sponsoring a new DeFi accelerator.

The latest expansion of the DeFi space through Binance was done in partnership with Orbs, an Israeli public blockchain infrastructure company.

The accelerator, announced on January 11, aims to support open source software research and development, as well as community development in the DeFi industry.

He will use defi.org as a domain name to support start-ups in the emerging financial landscape.

DeFi accelerates the pace

The new initiative will start by identifying projects that meet its criteria. These are based on the “principles of equitable distribution, community ownership, innovation, a responsible approach to risks, sustainable economy and compatibility with the ecosystem at large”, according to the article published at this subject on the Orbs site.

Participants will benefit from sponsorship and the possibility of obtaining funding of “several tens of thousands of dollars”. These projects will also be exposed to the DeFi market and community, which will likely originate from Binance .

Defi.org also promises:

An opportunity to inject liquidity for promising projects, to the tune of several million dollars in TVL when they are launched.

It was added that additional “special attention” will be given if participants request to be included in Binance’s seed fund for the DeFi-CeFi ( Bridging DeFi and CeFi ) project, or if they receive a grant under the Orbs Grant program.

It is likely that the projects approved and supported are “Binance centric” which runs on its own blockchain, as opposed to rivals such as Ethereum or Polkadot .

Binance’s DeFi Offerings Are Expanding

As part of its efforts to promote its own Smart Chain , Binance keeps releasing new staking and return incentives for new projects based there. Smart Chain uses a system called Launchpool, which receives new projects and offers Binance users short-term token farm initiatives.

The latest token to be launched is called Bitcoin Standard Hashrate Token (BTCST). This is a project to create an efficient market for Bitcoin mining energy, by functioning as a leveraged Bitcoin token without the risk of liquidation.

The new token will be secured by 0.1 TH / s of actual Bitcoin hash power, and has been launched in three liquidity pools of BNB, BUSD, and BTC. One can deposit funds there in order to cultivate the BTCST for thirty days.

At the time of this article’s layout, Binance’s token, BNB , was trading 14% down from its all-time high of $ 39.50 , reached over the weekend.

10 years since the creator of Bitcoin disappeared, the last post of Satoshi

Mysterious creator of the world’s most popular cryptomeda disappeared and never went online on the forum or anywhere else.

Satoshi Nakamoto is the pseudonym that created Bitcoin. Nowadays several people would like to know who can be the person behind the name, but until today this is one of the greatest mysteries of cryptomeda. Exactly 10 years ago Satoshi published one last message in a forum before disappearing and never being seen again.

On December 12th, 2010 Satoshi was last seen publishing a text on the Bitcointalk forum. His message was not a farewell or anything like that, the text made it clear that he was working hard on Bitcoin, citing that he was developing a security module for digital currency.

„There is more work to do on DoS[…], the software is not resistant to DoS attacks. This is an improvement, but there are still more ways to attack than I can count“.

Since then the mysterious creator of the world’s most popular cryptomeda has disappeared and has never been online again on the forum or anywhere else. Information about who he might actually be has never appeared, and therefore Satoshi’s identity has never been revealed.

The sudden disappearance is also sad, after all, if he never said goodbye, how can his fans know if he is ok? Is he still alive? Will he appear one day?

The wallets assigned to Satoshi Nakamoto never moved a penny. Anyway, the genius of cryptomorphs decided to remain anonymous. And there are many people who prefer it that way.

Now, 10 years have passed since Satoshi disappeared, the cryptomime created by him is world leader, a Bitcoin is worth $ 19,000, the currency was considered the best asset of the decade and there is no sign that cryptomime will cease to prosper.

During all this time many people have tried to claim the identity, but none of them managed to prove it. The most bizarre of all was Craig Wright, who later became known as faketoshi due to his desperate and failed attempts to prove himself as Satoshi.

The real Satoshi always worked in anonymity, and even with the success of the coin he remains so. It seems he doesn’t like the spotlight much, even being a world hero who created a protocol that is revolutionizing the world.

Some studies try to discover who he is through stylometry, and a more recent one claims that he lived in London. But everything is speculation. The truth is that we will only know who he is on the day he wants, and if he wants.

Rara posibilidad de almacenar BTC con un 50% de descuento en el precio de mercado durante los premios exclusivos de ProBit Interés significativo ya que BTC apunta a $ 20,000

ProBit Exchange, la plataforma de las 25 principales criptomonedas globales, ha anunciado la próxima de sus ofertas exclusivas de ProBit basadas en suscripción que presentará descuentos del 50% en BTC el 23 de diciembre. actual crème de la crème del sector de las criptomonedas a medida que BTC continúa obteniendo un respaldo institucional considerable.

Uno de los partidarios más fervientes de Crypto Cash en Microstrategy ofreció recientemente bonos convertibles por valor de 550 millones de dólares para liberar capital adicional y extender sus tenencias actuales de BTC de 40,824 BTC. Si bien el oro representa tradicionalmente la clase de activos de referencia, BTC ha establecido su temple como el activo de mayor rendimiento en 2020 y, a menudo, se lo considera oro digital.

A medida que continúa la especulación sobre un avance en el territorio de $ 20,000, el BTC Exclusive es una oportunidad ideal para aumentar las tenencias y posiciones de BTC. El evento también es una oportunidad excelente y oportuna para que los comerciantes más nuevos acumulen el activo criptográfico superior durante el evento basado en suscripción que presenta una asignación máxima de 50.000 USDT de BTC.

Las exclusivas anteriores de ProBit han capitalizado aumentos significativos de precios después de la distribución, ya que varios tokens alcanzaron rendimientos anualizados que superaron el 4000% para los participantes.

Token de PROB resaltado por un aumento del 288% hasta la fecha

El token nativo PROB de ProBit Exchange se ha separado del resto del paquete en camino a publicar el mejor rendimiento de diciembre hasta la fecha entre todos los tokens de intercambio al 288%. Los tokens PROB también generan recompensas del 4% anual para los participantes y brindan descuentos en las tarifas comerciales que aumentan exponencialmente y la entrada a eventos de usuarios, como el próximo BTC Exclusive.

El intercambio está ejecutando una competencia de Copa ProBit donde los usuarios pueden acumular puntos por comprar y apostar el token de intercambio principal. Las tablas de clasificación se actualizan periódicamente y cuentan con un premio total de 10,000 USDT para los 20 principales ganadores de puntos una vez que la clasificación del evento sea definitiva después del 31 de diciembre de 2020.

Acerca de ProBit Exchange

ProBit Exchange es uno de los 20 principales intercambios de cifrado a nivel mundial. Hemos completado más de 200 rondas de IEO y siempre hemos sido clasificados como los 4 mejores en Corea. ProBit Exchange proporciona acceso comercial ilimitado destacado por casi 1.000 pares comerciales.

Un evento especial de la Copa ProBit con 10,000 USDT para los 20 puntos totales principales se está ejecutando actualmente durante el mes de diciembre en el que los usuarios pueden acumular puntos comprando y apostando el token nativo PROB de ProBit.

KuCoin hack: exchange managed to recover 84% of funds

The KuCoin exchange suffered an attack last September. But the vast majority of affected cryptocurrencies could be recovered by the platform’s teams, which is usually rather rare.

KuCoin recovers funds stolen during the hack

As a reminder, the KuCoin hack had a particularly noted scale this year. First estimated at 150 million dollars, the losses were then evaluated at 281 million dollars . The attackers left with Bitcoin (BTC), Ethers (ETH) as well as ERC-20 tokens.

Johhny Lyu, CEO and co-founder of KuCoin, however communicated on the hack yesterday, and the news is pretty good for the trading platform:

„At the moment, 84% of affected assets have been recovered through various approaches, such as tracking on-chain, updates contact s and judicial recoveries. As law enforcement wants, we will not release details until the case is closed. “

Return to normal expected this month

In addition, the exchange was able to re-unblock exchanges for 176 cryptocurrencies. KuCoin explains that on November 22 all tokens on the site will be available again.

It is therefore 236 million dollars that could be recovered by KuCoin after the hack. The news is rather unusual. In the majority of cases, funds stolen from centralized exchanges are never recovered by companies, which can have particularly harmful consequences for the future of platforms.

For next Bitcoin course Bullrun, top analyst holds these 10 Altcoins

Altcoin coins like TRON, Ethereum, IOTA

Analyst and influencer Tyler Swope recently revealed his Top 10 Altcoins, which he believes should be part of every portfolio at the next Bitcoin course Bullrun.

Swope, who expects a major Bitcoin course Bullrun at the end of the year, said that despite the losses of the past two months he is still a supporter of Chainlink (LINK). He continues to believe strongly in the decentralised oracle network and says LINK is still his first choice for Altcoins‘ HODLn. According to his own statement, Altcoin accounts for 40% of his portfolio.

So why will I still hold each and every one of my Crypto Superstar LINK with a firmer grip than Sly Stallone? Well, it boils down to two things: the use of LINK is still on the horizon, and roll-ups – not the fruit type.

Swope’s second most important HODL choice is Bitcoin. BTC accounts for 17% of the portfolio.

Ethereum is his third best choice after the asset’s 82% increase in price since the end of May. ETH accounts for 12% of its portfolio. He noted that he plans to increase this position.

Energy Web Token (EWT) is number four in Swope’s portfolio after a price increase of almost 94% since the end of May. The analyst reports that the German government has teamed up with Energy Web to build a prototype identity register for the German energy market. EWT accounts for 6% of its portfolio.

REN is number five in Swope, with growth of almost 300% since the end of May. It also accounts for 6% of its portfolio.

Number six is Unibright (UBT), which has lost value since May and now accounts for only 5% of its portfolio. At the end of May, it was still 15% due to the more positive valuation of Altcoin.

Kusama (KSM) is his seventh HODL election, after its value has risen by more than 400% since the end of May. Assets represent 3% of its portfolio.

Number eight is the Rocket Pool (RPL), which in contrast has only risen by about 12% since May. The RPL represents 2% of his portfolio.

Swope’s ninth choice is XDAI Stake (STAKE), which represents 1% of its portfolio.

Last but not least, his tenth choice is Sora (XOR), also with 1%.

Sentralbanker vil ha digitale valutaer fordi de frykter Bitcoin

En grundig rapport fra Bank of International Settlements (BIS) avslører den virkelige grunnen til at sentralbanker ser på digitale valutaer.

Konseptet med sentralbank digital valuta (CBDC) har utviklet seg ganske bra og blir uunngåelig. Det er en ny form for fiat-valutaer utstedt av sentralbanker i digital form ved bruk av sentraliserte eller tillatte distribuerte hovedbøker.

Mange land forsker på eller er allerede nærmere lanseringen av en nasjonal digital valuta. Men et felles papir koordinert og publisert av Bank for International Settlements (BIS) på fredag ​​avslørte at sentralbanker engasjerer seg i CBDC-spillet fordi de er kryptofobe.

Som en internasjonal organisasjon gir BIS støtte til nasjonale sentralbanker. Deltakende banker i rapporten er Federal Reserve, Den europeiske sentralbanken, Bank of Canada, Bank of Japan, Bank of England, den sveitsiske nasjonalbanken og Sveriges sentralbank, Sveriges Riksbank.

Mister kontroll

Papiret fremhevet nøkkelkriteriene for å lansere og offentlig utstede en sentralbank digital valuta. Bankene vurderte muligheten for CBDC og hvordan de ville hjelpe sentralbanker med å nå sine mål for offentlig politikk.

Men deres største bekymring er å miste kontrollen over betalingssystemet, som kan bli truet av masseadoptering av kryptovalutaer som Bitcoin og private løsninger som Facebooks foreslåtte Vekt.

Roll for privat sektor

Sentralbanker vil ha digitale valutaer som er billige eller gratis å bruke og ikke skader monetær og finansiell stabilitet. I følge rapporten ønsker de også digitale valutaer som kan eksistere sammen med andre lovlige anbud, spesielt kontanter, og ikke en som vil gjøre kontanter foreldet.

BIS mener at et CBDC designet for å levere „disse funksjonene kan fremme mer elastiske, effektive, inkluderende og innovative betalinger.“

Til tross for at de ikke ønsket å miste kontrollen over betalingssystemet, bemerket papiret at det burde være „en passende rolle for privat sektor, samt å fremme konkurranse og innovasjon.“

Korea for å starte CBDC sirkulasjonsfase

Land som Kina og Sør-Korea er allerede på vei mot å lansere sine digitale valutaer.

CryptoPotato rapporterte i forrige måned at People’s Bank of China ble sitert og sa at landet skulle være det første som utstedte og sirkulerte en nasjonal digital valuta. Flere andre rapporter ryktet at sentralbanken til og med har startet å teste den digitale yuanen på små detaljhandelstransaksjoner.

Tidligere denne uken kunngjorde Bank of Korea at den ville lansere et prøveprosjekt for å utstede og sirkulere sin digitale valuta over hele landet innen 2021.

Men Japan er ikke interessert i å lansere en snart. I følge en fredagsrapport avslørte regjeringens øverste talsmann at landet for øyeblikket ikke har noen „spesifikke planer“ for å utstede en sentralbank digital valuta. Landet innrømmet imidlertid at det må øke og utdype forskningen på CBDC når verden fortsetter å digitalisere.

Rise in DeFi scams tarnish Yield Farming’s market niche

With scams at DeFi multiplying every day, industry stakeholders are urging investors to prioritise due diligence before investing in any project.

For those working in the DeFi field, not a day goes by without reporting a project or other „exit scam“ on its investors. From sudden withdrawal of backing to false pre-sales, both DeFi experts and novice traders are bleeding Ether’s (ETH) value into these scams.

With DeFi creating a market segment where the cost of starting a project is almost zero, dishonest players now have the perfect environment to continually siphon off funds from the victims. With the help and complicity of a multitude of social network scammers and the current climate of frantic pursuit of Yield Farming returns, these crypto-scammers are capable of carrying huge sums of money amounting to hundreds of millions of dollars.

Instead of DeFi helping to democratise access to global finance, the emerging market niche is being invaded by scams. The sheer volume of swindles, scams and other unpleasant market practices also appears to have contributed to a significant cooling of prices in the sector, as investors become increasingly wary of new projects.

Crime pays at DeFi

As for the scams, those seen in the DeFi space follow the same basic playbook. The anonymous founders create a new project that copies the code of an intelligent contract from an existing token and make small changes to the parameters such as the total supply.

Typically building on any trends that have recently gained favor in the DeFi marketplace, these scammers flood Telegram groups and other social networking platforms. With the help of the „moon boys“, or paid accomplices with a considerable number of followers on Twitter, the project creators spread the word about their alleged new DeFi „jewel“. All these scams share the same premise: low market capitalization caused by a limited supply of tokens that guarantee huge profits for early adopters or about 1,000% profit.

However, with these projects focused on price and having little or no consideration for useful technology, the zero-sum game results in a sharp drop in valuation that leaves most adopters with bags of ERC-20 tokens worthless. For Douglas Horn, chief architect of the Blockchain Telos network, the success of these scams is based on the unbridled desire to make a quick profit in the crypto market, as he told Cointelegraph:

„Any time you are chasing this kind of FOMO market action, you are already making a mistake because you are betting on your ability to make a profit by being faster than the masses, knowing that it is impossible for all or even most of the participants to make it. That will always end in tears for most participants and is an extremely poor investment strategy. […] Good investments do not have that level of FOMO or time contraction“.

When developers are not immediately withdrawing support, some project developers are adding lines of malicious code designed to steal funds from their users. Yield Farming participants in the dubious UniCats protocol recently saw their balances in tokens diverted by a dishonest developer.

Hidden behind anonymity, project developers and promoters are taking advantage of the credulity of some crypt investors. In some cases, these rogue players choose to use the long-term approach of cultivating a huge following and appearing to be against scams. Once their attraction to social networks reaches a certain level, they announce a pre-sale of tokens from a new income-generating machine. Based on the trust gained by the project’s creators, investors pile up their ETH and the scammers soon disappear with the funds.

Useful tips to avoid DeFi scammers

Amidst the litany of counterfeit coins appearing in decentralised markets such as Uniswap, the need arises to arm investors with useful information to avoid becoming victims. Given the novel nature of the industry, there is still a considerable knowledge gap among investors that makes them easy targets for these cryptic scammers. Malcolm Tan, a board member of the KingSwap automated market-making platform, told Cointelegraph that investors have a responsibility to do their own due diligence:

„It is very important to look at the team and the founders, and check their profiles on LinkedIn and those of their advisors to see that they have actually listed the project. …] Read as much as you can about the projects and make sure you think about how you would get your money back if you put it into the project – which means that projects that don’t even list their location or jurisdiction or have familiar faces to look at if things go wrong, shouldn’t be touched.“

According to Michael Gu, founder of the popular YouTube channel Boxmining, DeFi investors should adopt the „don’t trust, verify“ philosophy. Writing to Cointelegraph, Gu advised high net worth hunters to become experts in researching DeFi projects, adding that anyone can easily check „how much a developer has built in terms of code, to make sure they are not lying or embellishing,“ he added:

„Devoting time to research is key, I personally spend up to six hours a day on research alone. Right now, the best way to avoid scams is to check the facts – which includes looking at the smart contract code and GitHub repositories. This is the best part of DeFi, as the smart contracts are open source and open to everyone to verify and validate.“

Since withdrawals by developers are possible from time to time because the liquidity of the project is not blocked, it has become popular among investors to check whether the developers of a new token have blocked liquidity using services such as Unicrypt. Even with blocked liquidity, malicious code hidden in the contract can also present a back door for dishonest players to drain the funds. For example, in February 2020, hackers were able to exploit a code weakness to execute flash loan attacks on the bZx decentralised loan protocol, resulting in a loss of around 1,139 ETH, worth around 1 million dollars at the time.

Taking the shine off a legitimate niche of crypto currencies

Apart from the significant losses suffered by the victims of these scams, it is reported that the sheer volume of fraudulent activity is taking its toll on the DeFi market as a whole. As in the case of the ICOs, the fake projects are preventing attempts to initiate the democratisation of global finance.

Commenting on the negative impact of these scams, Horn told Cointelegraph that the Blockchain technology should represent transparency and trust, but „instead, it is more prominently associated with these scams and unaudited codes, just as the failure of many ICOs to live up to their promises helped sink cryptosystems in early 2018. According to Horn, the current situation in the DeFi space is escalating even further than what was seen during the ICO craze:

„The DeFi cycles are happening at a much faster pace. All this detracts from the amazing potential of democratised finance to build powerful systems and self-created derivatives from chaining many different financial primitives. Someday this will change the world, but not until there is more stability and quality in the offerings.“

There is an emerging trend in the DeFi space that has seen the market transition from Yield Farming to „Ponzinomics“, with sudden withdrawals by developers and fraudulent pre-sales becoming commonplace in recent weeks. For Gu, these scams threaten to deflate the hype and enthusiasm surrounding the DeFi space:

„These scams are affecting people’s interest in Yield Farming, which is the main attraction for people, as some projects promise unrealistic returns not seen before. And with interest and returns in Yield Farming decreasing due to people’s fear of scams, the corresponding interest in DeFi in general is also losing strength.“

However, not all stakeholders share the view that these DeFi scams are the death knell of the emerging cryptomoney market. Rafael Cosman, co-founder and CEO of stablecoins issuer TrustToken, told Cointelegraph that DeFi’s space can overcome the challenges posed by rogue players:

„All new technology is subject to bad actors who, all too often, are also the first to adopt it. Cutting edge technology has often been an attraction for money-making scams, pornography or the sale of illicit goods, but when good, creative people keep building, technologies like the modern Internet are obtained. […] I predict that DeFi will continue to innovate, consumers will continue to become smarter, and standards will continue to rise for what it calls something worth putting your money into.“