COINBASE for Crypto has come
Leo
Well-known member
how are the various currencies different from one another? what makes one of them "one to watch" as opposed to another?
Well, you have to be in the trenches- and watch the news on it- they don't know where it is going , so there is of course alot of rubber necking.
Day by day for example Cardano and Ve Chain have been going up,
sometimes a coin becomes a 'stablecoin'.
On the other hand there is Doge which was meant as a meme joke that blew up just because of all the excitement hype.
Of these more reputable coins and new coins case by case, the blockchains running the technology are better then what came before, this is the interesting end of it - if there is ever a time to back up Gov. and ... anything w blockchains, some things in print as digital is fickle this has now become that time.
if for example blockchain - probably something next beyond bc will become the next seed ( Tangle, IOTA, Benet's IPFS )
if Gov's begin to go blockchain that will be something, i could see it in US if Harris becomes Prez. and she is followed by either a second term or next progressive - Democrat likely.
Meanwhile @ Geneva or offshore @ Seycelles will they put everything on blockchain, every transaction, fee paid - without a fight ?
And it would take 10 -15 years.
Gov. and legal being the slowest horses out there.
But the taps are open in US , for the digital currency communities it is boom moment and it may not even be a bubble
Will have to see.
constant escape
winter withered, warm
Since february, I've put most of my savings into crypto, and have been dedicating more and more of my cognitive bandwidth to understanding the technology.
Some terms:
A blockchain is a distributed ledger, which can either be used as a financial ledger or a database more broadly. The ledger is maintained by a network of computers/nodes that process transactions made between addresses on the ledger, package these transactions data into bundles ("blocks"), then transmit that block back to the network to be approved by other nodes, after which point it is confirmed and appended to the blockchain. Different blockchains have different nuances, some of which are more impactful than others in terms of energy efficiency, transaction speed, RAM requirements for nodes, token economics, etc.
A cryptocurrency is a currency native to a given blockchain, and exists only as balance data on the addresses in the ledger. When you "send" Bitcoin, you are submiting a change to the shared ledger that involves changing the balance associated your address, and changing the balance associated with the address of the recipient. There are manifold ways of engineering the token economics, such as fixed caps (BTC), token burns, revaluations of tokens, all of which can be democratically voted for by token holders. Even the governance itself is algorithmic and can be redetermined according to votes.
DeFi (decentralized finance) is a protocol-enabled (rather than human/institution intermediary-enabled) means for exchanging cryptos, lending/borrowing, and more complex cutting-edge fintech. As opposed to a centralized exchange, such as coinbase, which has a central entity mediating exchanges with a set of pools it operates, DeFi involves liquidity pools entirely consisting of users who provide trading pairs. You can provide $1000 worth of BTC and $1000 ETH to a decentralized exchange (Dex), and then get a small proportion of the trading fees paid by users who trade that pair, on that dex. The vast majority of DeFi activity is native to Ethereum.
Smart contracts are protocols built upon a blockchain. I am still too early to programming to really elaborate on the technical side of this, but in general terms it allows automated financial agreements between addresses on a give blockchain, thus removing the need for an intermediary to officiate and settle such agreements. If a politician promises X, x can be programmed into a smart contract and automatically executed if that politician is elected. No longer have to depend on the fickle word of humans who have skin in the game and insufficient oversight.
The portfolio
~45% ETH (Most of DeFi is built on Ethereum, ETH 2.0 is in the works, several other protocols being built upon Ethereum to address its scaling, such as Polygon)
~10% BTC (Really just for its symbolic value. I think I missed the train here, and now I'm starting to align with those who are putting the brakes on it due to environmental reasons. Other, more efficient blockchains out there, such as Cardano, Algorand; maybe also Nano, but I haven't looked into that.
~10% ADA (Cardano seems poised to actually implement blockchain in various sectors; already implemented in the education sector in Ethiopia; downside is no DeFi or even smart contracts yet, but that is coming; developer also worked on Etehreum)
~8% NEXO (A share token for Nexo, a crypto lending platform that pays interest for you parking your idle assets here; competitors are BlockFi (which CFTC's Giancarlo just joined the board of), Celsius (which I also use); the token pays dividends (which as US user means I get the dividend in BTC, as Nexo has not filed with the SEC; also has a utility for raising the interest you earn on Nexo, granting you a few free withdrawals, and lowers the interest you pay on over-collateralized loans)
~8% MATIC (Polygon is still early, focused on enabling the scaling of Ethereum, but may also have its own autonomous functionality, not quite sure yet; still understanding how this would work as a layer 2 for Ethereum, or if it is even exclusive to Ethereum)
~5% ALGO (MIT's blockchain, carbon neutral, not sure if it supports smart contracts yet)
~5% ATOM (The native currency of Cosmos, which I am still unsure is a blockchain or a means of connecting blockchains into an ecosystem; pretty sure its a blockchain which some capability of connecting with others; I just participating in the beta for its first decentralized exchange, Gravity Dex, which means Cosmos DeFi is around the corner)
~2% BNB (Don't know much about Binance, other than that it is the worlds largest exchange (by trading volume I assume) and that the token has a utility of lowering transaction fees on Binance.
~1% COMP (Haven;t started studying this one, but I gather its a DeFi interest earning protocol; not sure if it involves loans; presumably built on Ethereum)
~1% AAVE (A DeFi lending protocol; presumably built on Ethereum)
~1% CRV (A DeFi staking protocol; presumably built on Ethereum)
~1% CELO (Designed as an accessible means for newcomers to exchange value via crypto)
~1% ANKR (Designed to lower the cost/complexity of setting up nodes, primarily in the Ethereum network but perhaps also for others soon; claims to connect those with excess hashing power to those with excess staking power, and vice versa)
~1% GRT (Some kind of data-indexing protocol, presumable cross-chain)
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hmg
Victory lap
Awesome post.
constant escape
winter withered, warm
Also forgot Chainlink, which is a decentralized oracle network. An oracle is a means for feeding real world data (weather data, market data, supply chain data, etc) into a blockchain, which is intrinsically hermetic, a closed system. Normally blockchains only compile data native to that blockchain, but having an oracle that provides trusted real world data allows smart contracts to integrate real world information, which is necessary for smart contracts to scale up to their full potential, rather than remain hermetically confined to a blockchain.
pattycakes_
Can turn naughty
Back with a bang. Wb @constant escape
Leo
Well-known member
@constant escape !!! so glad to see you again, you've been missed. thanks for the detail above, hope all is well.
constant escape
winter withered, warm
Thanks all, happy to be back. I'd like to help out with the collective dissensus crypto strategy.
Leo
Well-known member
I feel like I'm reading a passage written in French. I'm able to translated about 30% of it in my head and understand it, the rest is largely guesswork on what it actually means. I suppose the question is: do I have the determination to really become fluent in French/crypto?
Hmmm, depends, also still early days really.
One just has to watch that flow daily and get feel
Currently there is what used to be called ' froth ' in the markets,
though i see here at least the more upbeat mood of people , masks coming down or off there , a few factors have combined with a feeling of timing.
And so the deal streams under Decentralization, Distributed grow by the minute
constant escape
winter withered, warm
Yeah I'd say anyone interested in investing in crypto assets out to spend a at least a week more or less glued to the crypto market data, cause thats most likely how it will be when you actually have skin in the game.
The coinbase "learn to earn" program is helpful, and can give you a few dollars worth of the crypto assets being promoted.
I am currently of the hodl mentality. I think its best to save your crypto, ideally in a place when you can earn interest and even borrow dollars/euros against it. I mentioned Nexo, but also look into Blockfi, Celsius, Voyager, maybe some others.
You can turn these assets into a source of passive income, while also playing a role in securing and expanding the very crypto economy that enables such fluid and frictionless middle-class capitalism.
constant escape
winter withered, warm
But the research is important. If you do not understand the business model of Nexo, than skepticism is totally warranted. How is it possible to earn 10% APY on stable coins, even on Euros, pounds, and (starting today) dollars? For me, it is the innovative business model that enables this, plus the fact that this business model is embedded within a novel and blossoming financial framework that promises much less friction and exploitation than the current legacy model.
As the user bases of these lending platforms increases, might the interest rates decrease? Certainly possible, I'd even say its to be expected. But if all the loans provided are double, triple, even quadruple collateralized (depending on the particular asset, as well as the lending platform), I tend to think we can rest assured that things won;t bust, unless you personally have a highly leveraged loan out which strikes me as unwise given the volatile adolescence of this market.
edit: in the case of nexo, if your collateral depreciates enough for your outstanding loan to pass your leverage-to-value ratio, more collateral is transferred from your hitherto non-collateral assets. If all of your assets are serving as collateral, and this threshold is passed, the liquidation is automatic and irreversible.
As the user bases of these lending platforms increases, might the interest rates decrease? Certainly possible, I'd even say its to be expected. But if all the loans provided are double, triple, even quadruple collateralized (depending on the particular asset, as well as the lending platform), I tend to think we can rest assured that things won;t bust, unless you personally have a highly leveraged loan out which strikes me as unwise given the volatile adolescence of this market.
edit: in the case of nexo, if your collateral depreciates enough for your outstanding loan to pass your leverage-to-value ratio, more collateral is transferred from your hitherto non-collateral assets. If all of your assets are serving as collateral, and this threshold is passed, the liquidation is automatic and irreversible.
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constant escape
winter withered, warm
This is a central question. If you do, you will be able to recognize and sift away the pump-and-dump rugpull coins and identify the ones that actually have an active development team, wide use cases, etc.
The best part is, you still have plenty of time to learn this stuff. DeFi is very, very young, and only a sliver of the potential applications of blockchain and smart contracts has been identified, yet alone accomplished.
constant escape
winter withered, warm
The implications for civics are profound.
edit: This guy in Argentina started a universal basic income program on blockchain. Presumably its still in a prototype stage, but in an interview he said there are already 10,000+ humans receiving "UBI coin" or whatever the token is named. Santiago Siri is his name, if anyone is interested.
edit: This guy in Argentina started a universal basic income program on blockchain. Presumably its still in a prototype stage, but in an interview he said there are already 10,000+ humans receiving "UBI coin" or whatever the token is named. Santiago Siri is his name, if anyone is interested.
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constant escape
winter withered, warm
Yes, so far the four established taxable events in crypto are, to my knowledge:
-when you sell crypto (crypto to dollars, euro, etc) you need to report gains/losses.
-when you convert between cryptos you need to report gains/losses.
-if you purchase something with crypto (unclear on what precisely this entails, maybe there is a minimum purchase value to trigger a taxable event).
-when you gain interest in crypto, you need to report gains at the time it was added to your balance.
I'm pretty sure certain platforms provide the pertinent 1099 form, but if not they also keep an exhaustive record of your transactions for you to access and manually fill of the forms. I'm not an active trader, so I don;t have much to report. Plus, I'm interested in holding these assets for well over a year, at which point a sale would qualify as long term capital gains and warrant lower taxation.