Lưu trữ cho từ khóa: Adoption

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The perks of the world where 40% of the adult population owned crypto | Opinion

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In June, Security.org published findings that raised quite a few eyebrows around the crypto world. Their new data found that 40% of American adults now own crypto, up significantly from last year. Even more, it seemed like a sustainable increase. Crypto ownership among women has spiked, and a huge chunk (21%) of non-owners are more likely to invest after the approved US Bitcoin (BTC) exchange-traded fund.

There are some caveats to remember here. This data is based on two relatively small surveys (1,001 and 504 people, respectively) and may misrepresent the entire US population since they were done online. The Federal Reserve listed just seven percent of US adults as crypto investors in 2023, with a much bigger sample size. However, their data, too, might be misrepresentative, given that the respondents were selected from only those who agreed to participate in Ipsos’ KnowledgePanel.

Whether or not the Security.org number is realistic, it has got me thinking. What if 40% of the world’s adult population (about 5.75 billion people) owned crypto, not just the US? This idea has been rolling around in my head for a couple of months now. It both baffles and excites me. Here’s what I’ve come up with.

There would be four major categories of change:

●  Individual economics.

●  Financial systems.

●  Technological and social patterns.

●  Environmental policy.

Come along with me for this thought experiment. One that might not be all that far-fetched is the way things are going.

Individual economics

One of the most touted benefits of cryptocurrency is its potential to provide financial services to the unbanked or underbanked.

Take the Philippines for example. Despite 66% of their population being unbanked, crypto usage is rising. Over 13% (or nearly 15.8 million people) own crypto, and the government is rapidly pushing to release a central bank digital currency to keep up with the demand.

Over $33 billion in cash remittance is sent home from overseas Filipino workers, another perfect use case for crypto. Traditional banking systems, often inaccessible or inconvenient for citizens in developing regions, will find a formidable competitor in blockchain-based financial services if adoption continues to increase.

Crypto could serve as a financial equalizer, bridging gaps that have long excluded vast populations from economic participation.

Volatility and risk

Cryptocurrencies are infamous for their volatility, which might pose a significant risk for the underbanked. But if as many as 40% of the world were invested, that volatility would likely decrease. As more people participate in the market, the liquidity of crypto assets would increase, making it harder for any single transaction—even from whales—to dramatically affect prices.

A more widely held and traded asset tends to have smoother price movements, as the effects of large buys or sells are diluted. As the adoption rate increases, we can anticipate that cryptocurrencies might stabilize (to some extent), making their value more predictable over time.

Investment patterns

With nearly half the adult population holding crypto, traditional investment paradigms would shift. A significant portion of personal savings could be directed toward digital assets rather than conventional investments like stocks or mutual funds. Diversification would have a whole new meaning; traditional portfolios would include a mix of equities, bonds, and digital assets.

Financial systems

The massive shift in investment patterns would inevitably disrupt traditional financial markets. With so many people not invested in digital assets, a considerable portion of capital that might have been funneled into traditional stocks and bonds would instead flow into the crypt ecosystem.

This diversion could result in liquidity challenges for conventional markets, increased volatility, and shifts in valuations as investor attention is divided. IPOs would likely be structured differently, with some companies offering ICOs either as a replacement or in support of their public offerings.

Crypto integration

However, not all the effects will be negative. The increased demand for crypto-based investment opportunities would lead to greater integration with existing structures. We’ve already seen the beginning of this with the approval of several Bitcoin ETFs, which provide a regulated, familiar pathway for traditional investors to gain crypto exposure. These financial products would become normal—even mundane—as mainstream adoption rises.

Regulation and policy changes

However, for mainstream adoption to be possible, regulatory adjustments would be necessary. We’ve already seen some notable developments in this area. For instance, Senate majority leader Chuck Schumer recently pledged to push crypto regulation through before the end of the year. Legislation ensuring investor protection, curbing market manipulation, and fostering innovation would likely emerge all over the world. Policymakers would be compelled to work with the private sector to develop frameworks that both allow crypto to flourish and ensure it doesn’t undermine overall financial stability.

Digital payment expansion

Some of that legislation would have to address the explosion of digital payment options. Recently, a bipartisan bill was introduced by Senators Tedd Budd (R-NC), Kyrsten Sinema (I-AZ), Cynthia Lummis (R-WY), and Kirsten Gillibrand (D-NY) to remove the capital gains tax on small crypto payments. If successful, this type of legislation would set a precedent, encouraging more countries to follow suit and integrate crypto into their everyday economies. Imagine paying for your morning coffee or splitting a dinner bill without worrying about the tax implications.

Technological and social patterns

As crypto usage increases, blockchain innovation also increases, with new use cases being created every day. From supply chain management to healthcare, distributed ledgers can help increase transparency, security, and traceability.

Digital identification and trust

Governments all over the world are exploring digital identification, though too few are including blockchain technology in their initiatives. If crypto continues to thrive, blockchain-based citizen authentication will be a natural byproduct. Digital IDs on the blockchain can significantly reduce fraud, streamline transactions, and enable secure, authenticated access. Your ID would be universally recognized, securely stored, and irrefutable with the help of identification layers from companies like Concordium.

Social implications

For it to rise to 40% or more, trust must be placed in the technology itself rather than in human institutions. For many, that shift requires a leap of faith. Peer-to-peer transactions could become the norm, reducing reliance on traditional banking. The younger, tech-savvy generation would lead this transition, driving innovation and new business models. But it could also exacerbate digital divides. Those without access to the internet or technological literacy may find themselves further marginalized. Policy and educational programs would need to be created to promote inclusive access to new financial systems.

Environmental policy

One of the most pressing issues surrounding the widespread use of crypto is the environmental impact. Major tokens like Bitcoin (BTC) operate on a proof-of-work model, which requires extensive computational resources and, consequently, a large amount of energy. The Environmental Working Group has been vocal about the need for change through their “Change the Code, not the Climate” campaign, advocating for Bitcoin to move away from PoW to less energy-intensive models like proof-of-stake.

However, the environmental story isn’t just doom and gloom. Crypto and blockchain tech also offer promising avenues for advancing green energy initiatives. Peer-to-peer energy trading, where individuals can buy and sell their renewable energy directly to and from their neighbors, could reduce our reliance on traditional sources.

Final thoughts

There’s still a lot of change to come if we want widespread cryptocurrency adoption. None of it is possible without a thoughtful, well-rounded policy that supports innovative technology.

I’m hopeful that the recent developments in the US and ongoing public pressure in the EU and the UK will force lawmakers to realize that the public wants—and deserves—robust, supportive crypto frameworks instead of endless restrictions.

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How crypto can reach the next one billion users | Opinion

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Most crypto entrepreneurs love to brag. They’ll tell you their blockchain, protocol, or app will onboard the next one billion users—and finally make digital assets a mainstream and indispensable part of our day-to-day spending.

But scratch beneath the surface, and you’ll quickly realize this is a load of hot air. Why? Because many of these projects suffer from the same issues that have prevented widespread adoption for the past decade: a chronic lack of usability.

Around 0.4% of all crypto users claimed their domain using Unstoppable Domains over the last few years. It’s not because of lack of demand but because of poor user experience and lack of security, where anyone can trivially look up the user’s balance and transactions just by knowing their name. It appears that neither Unstoppable Domains nor friend.tech or Mastercard Crypto Credential hit the mainstream because of a fundamental lack of privacy.

Poll after poll after poll tells us why everyday consumers are reluctant to give crypto a try. Bombarded with headlines about multimillion-dollar hacks and bad actors, they openly wonder whether businesses in this space are up to the job of protecting their cash. While many payments to merchants and loved ones are free for the public in the world of traditional finance, the prospect of forking out several dollars to cover transaction fees is very off-putting. Why make the switch to new technology that’ll actually cost you money?

That brings us to the endless jargon that curious prospective customers are bombarded with when they visit a crypto website. From talk of zk-SNARKs to liquidity pools and from degens to DAOs, too many platforms make things way too complicated. It’s little wonder that beginners feel everything is written in a second language that’s impossible to understand.

All of this then feeds through into usability. Web2 users are accustomed to getting what they want done in a couple of clicks without needing a PhD in coding to know how things work. Even those who regard themselves as tech-savvy often find web3 platforms painfully complex to use, meaning crucial first impressions are blown because newcomers give up in frustration.

When you bundle all of this together, crypto’s challenges become crystal clear: complexities in how blockchains have been designed detract from the powerful benefits they offer with decentralization, censorship resistance, and financial inclusion. One big hurdle in the way of tackling all the hurdles we’ve mentioned is alphanumeric addresses.

Addressing the issue

Bitcoin addresses are 34 alphanumeric characters—a random bunch of letters and numbers that are both impossible to memorize and prone to mishaps. To illustrate what I mean, back in 2014, a group of 75 people in a study asked to learn a series of alphanumeric strings—varying in length from just six to 14 characters. Researchers found that, as the length of a string increased, so did the number of errors identified when participants were asked to type them out unprompted. The most common mistakes included incorrectly capitalizing letters, missing characters entirely, and typing them in the wrong order.

Now ask yourself this: if mistakes can creep in when trying to type just eight alphanumeric characters, what will happen when the string is four times longer?

Missing a single character can have disastrous ramifications when a crypto payment is being made. In all cases, if the wallet accepts the bad address, funds are lost forever.  Double-checking an address and scouring for mistakes is also easier said than done, with a slew of letters and numbers blending together into one decipherable bunch. This is why savvy crypto typically sends their crypto addresses via an encrypted chat to the sending party, and then they request the sender to send a test transaction for a small amount just in case the sender gets the address wrong. Once the test transaction goes through, the rest of the funds can presumably flow to the same address.  You must send an encrypted message with the correct recipient address in the smoothest instance of the proper process. The sender sends a test, the recipient confirms it, and then the sender sends the main amount. The address also has to be correct for the crypto being sent. Ethereum (ETH) addresses don’t work for Bitcoin (BTC) payments (again, total loss if you get this wrong).

The answer to all of this is simple yet staggeringly underutilized. Crypto users should be able to send to a human-readable name instead of a jumble of digits and characters. That name should also not reveal to the world how much money the owner of the name has. The user should be able to simply post their name anywhere, like a PayPal, Zelle, Venmo ID/QR code, and receive any crypto funds on any chain without hackers being able to divine how much funds were received. Crypto will never reach the same level of adoption as TradFi until it implements the privacy consumers are used to and, ideally, does everything TradFi does, only better.  Human-readable addresses can be thought of as the new digital real estate of web3. Just as owning property grants you an address, those names can carry real utility, unlike NFTs, empowering users with a unique identifier for seamless crypto transactions, digital assets ownership, and SSI.

On the security front, uncovering address poisoning scams, where malicious actors deceive unsuspecting users, could instantly become easier. Here, cybercriminals often generate alphanumeric wallets that are nearly identical to the addresses a victim has transacted with in the past—deceiving them into sending funds to an unintended destination.

This solution would also not need to rely on any Personally Identifiable Data (PID) to function and receive addresses computation, making it completely decentralized and, therefore, minimizing security risks. 

Human-readable addresses would also have a huge impact on ease of use, enabling consumers to enjoy the perks of digital assets without any of the fuss. Growing interest would, in turn, create a network effect as more and more users start to make transactions.

A good start—but what next?

The crypto industry may not wish to admit this, but human-readable addresses would only be the first step on a long roadmap to achieving mass adoption.

Account abstraction has been touted as a huge breakthrough in simplifying blockchains, as they enable funds to be managed through smart contracts. While this can offer greater customization to some extent—and move some of the technical processes behind the scenes—it remains complicated to implement and prone to security vulnerabilities, with the prospect of additional costs for end users.

That’s not the only headache that needs to be addressed. As of now, account abstraction only exists on Ethereum when many crypto enthusiasts make use of a constellation of other networks. Fragmentation between blockchains is getting worse—and because most wallets are built for specific ecosystems, they’re unable to communicate with one another. This gives users little choice but to rely on even harder-to-use bridges if they want to move wealth around.

Other vital steps that need to be taken with security include the implementation of multi-party computation and hardware security modules—vital safeguards that add another layer of protection for user funds in custody, all while making it prohibitively difficult for hackers to strike.

The future can—and should—be bright for digital assets. However, for blockchains, web3, and crypto platforms to achieve greatness, developers need to be brave, head back to the drawing board, and look at the user experience through the eyes of beginners who have never owned a single token. Then, and only then, can any claim of being able to onboard the next one billion users be taken seriously.

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Hybrid crypto exchanges will inevitably reign in the market | Opinion

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As we start to see renewed interest in crypto—with prices hovering near their all-time highs and prominent people and institutions discussing the industry—building a robust crypto exchange is essential.

Crypto traders’ standards for an exchange are higher than ever. They are looking for a sleek user experience, architecture that supports high throughput and low latency, and top-notch security. The latter is especially important given the industry is still recovering from the implosion of FTX and the domino effect it had on other businesses in the space. 

While centralized exchanges excel at building beautiful user interfaces and intuitive user experiences, they operate at speed by custodying users’ funds for them. As the industry has seen many times throughout crypto’s history, funds that the users themselves don’t control can be mismanaged by fraudulent actors. Additionally, CEXs possess the authority to limit access to accounts, such as freezing funds or halting withdrawals. As the crypto adage goes: Not your keys, not your coins. 

Decentralized exchanges, on the other hand, grant users complete control over their funds with self-custody. They leverage blockchain technology and smart contracts to execute trustless trade and settlement. However, this architecture can be clunky and complex for users to navigate. It comes with trade-offs in throughput and latency, the absence of advanced trading features (like advanced order types and conditions), and can also deal out significant fees to pay gas for settlement on a blockchain. 

A new crop of crypto entrepreneurs is thinking about exchange architecture differently. They are looking to combine aspects of a centralized and decentralized exchange with building on the best of both worlds. Enter hybrid crypto exchange. 

A better trading engine for a better crypto trader

CEXs from the last cycle, including Coinbase and Binance, built their businesses by copying the UI of broker platforms and mimicking the mechanics of broker platforms and the UI of fintech apps. They focused on user-friendly UI, robust mobile apps, competitive fees, and an extensive selection of coins and tokens. 

The centralized trading infrastructure offers high throughput and low latency, which is what the world demands for crypto trading. Going deeper, high throughput and low latency enable better liquidity, as market makers can reprice quicker. They also allow for more efficient margin usage, as a centralized risk engine enables the exchange to offer higher leverage. Centralization enables advanced trading features and logic, such as advanced order types and conditions. 

Aside from performance, it allows exchanges to have more control over compliance. CEXs control what customers have access to their platform and can manage the access of those users by implementing robust blockchain analysis, fincrime, and compliance programs. In the wake of FTX, lawmakers and enforcement agencies have been clamping down on the industry, dishing out huge fees and even jail time to businesses and entrepreneurs that are found to be skirting regulations. 

So, to sum up, that’s why the hybrid exchange model inherits the bright side of centralization. The trading architecture is kept centralized to a large extent. UX is also inherited from CEX because DEXs simply lack features, such as simple account creation, which eliminates the need for users to already have a wallet before interacting with the exchange. DEXes are also limited in their on- and off-ramps, fee abstraction, and advanced trading analytics. Especially as another batch of crypto traders enters the space during what appears to be the beginning of a bull run, a powerful feature set on top of a polished user experience is critical. 

It all sounds like a flawless victory for centralization so far. The question is, what do hybrid exchanges inherit from decentralized ones? The answer is simple: The essential feature that enables trust in crypto trading. And centralization has a dark side.  

Give users the keys

Hybrid exchanges still pull from DEX concepts by utilizing blockchain technology to secure funds. Users self-custody their funds, and trades are settled on the blockchain at various periods. Another crucial trait is the on-chain validation of the trading logic, which will prevent operator fraud. As such, trust is provable, and transparency is immutable. 

Operator fraud is one of the most significant risks in crypto. CEX’s control over funds is beneficial for compliance reasons; however, it grants the authority to limit access to accounts, such as freezing funds or halting withdrawals. The collapse of FTX certainly heightened concerns over an operator’s access to user funds. Yet, FTX wasn’t the first or only exchange to mishandle user funds and call into question the CEX model. One of the first-ever crypto exchanges, MtGox, completely shut down and filed for bankruptcy in early 2014 because of an undetected theft over many years that drained the exchange of more than 850,000 Bitcoin (BTC). In 2018, Canadian exchange QuadrigaCX went dark and was later revealed to be a Ponzi scheme, causing the loss of roughly $190 million in user funds. 

These continued instances highlight the importance of self-custody and trustless on-chain settlement, whereby users hold the keys to their own coins instead of trusting a centralized entity that isn’t fully transparent to retain their keys. 

Scaling tech for cutting costs

In the derivatives market, traders often transact in large volumes, which can accrue significant fees. There is no feeless trading. CEXs and DEXs charge fees for trading, but DEX users have an additional cost to settle all their trades on a blockchain. These fees fluctuate depending on the overall usage of the blockchain at any given period. Earlier this year, in March, Ethereum transaction costs skyrocketed to nearly a two-year high due to increased speculation in meme tokens.

The hybrid exchange approach simplifies the fee structure because trading is centralized and relies on layer-2 technology to boost scalability while keeping transaction fees low. Rollups are one such scalability solution that processes transactions on a separate network before bundling the transaction data into batches to submit and settle to the main chain. 

Now’s the time to go hybrid

Blending features from centralized and decentralized exchange architecture is an obvious choice in a market that’s becoming more mature and competitive. 

The speed, usability, and design of CEX help users of all levels of technical know-how trade crypto easily. And the security provided by implementing aspects of DEX will create an ecosystem of trust and reliability that gives users peace of mind. 

The hybrid crypto exchange is poised to be the winning business model in the next bull run, highlighting that it’s not always about reinventing the wheel as much as it’s about creatively putting the pieces together. It’s not a one-size-fits-all industry; it won’t have a one-size-fits-all solution.

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The future of web3 gaming is not tap-to-earn—it’s Roblox | Opinion

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It’s no secret that web3 gaming has struggled to take off. However, if the web3 gaming-related sector wants to make its mark on the global entertainment market, it must focus on what makes it unique. Current trends such as tap-to-earn and other arcade-like models are far from that.

With blockchain technology, web3 game developers can create games designed for players with complete rights to their virtual goods. This is a gateway to new in-game economies and speaks to a new generation of players who use platforms like Roblox. 

These gamers are used to creating assets and making legitimate profits from them, where players can monetize their creativity in a dynamic and legitimate in-game economy. It is not uncommon for this group to see these games as lucrative full-time jobs. This is where web3 gaming can find its perfect fit.

History replays itself

Having the mature market of traditional video games as its competition—with a total value of $200 billion a year—seems like a daunting challenge for web3 gaming. However, this doesn’t necessarily mean that it’s completely defenseless.

This used to be the case for traditional video games, too, which 30 years ago were a niche next to the global movie industry. Today, they have outgrown this market by far, with the gaming industry reaching approximately $227.6 billion in 2023, compared to only $65.21 billion for global subscriptions to over-the-top video-streaming revenue. Games like Fortnite have an annual profit equivalent to half the world’s movie box office. 

The current state of things came about when a new generation of users better adapted to technological advancements emerged. Then, people witnessed the potential in the gaming niche, and businesses turned to this segment of the entertainment market. Can this be the case for web3 games in three or five years?

An economy in (and of) leisure

The number of video game enthusiasts continues to grow each year, and they are welcomed by new platforms with new business models. This is especially the case for younger generations, who are more likely to treat gaming as their primary leisure time activity and entertainment.

Children and teenagers have plenty of free time to spend on leisure. They can easily spend 10 to 12 hours a day “grinding” or gathering adequate gear in a video game. However, for adults, this free time shrinks in the face of responsibilities, including financial ones. Many games lose long-lasting players at this point in the life cycle of their products mainly because they weren’t designed to balance engaging gameplay with monetary incentives—this is precisely the challenge that web3 is uniquely equipped to address.

Would it be possible to play for a living and choose it as your career path? A few years back, this idea seemed ridiculous. Obviously, a few chosen ones could treat playing as a full-time job thanks to e-sport competitions or streamer revenues. For most, however, these doors would remain shut.

The Roblox model

However, if we look a bit closer at a few renowned, massive multiplayer web2 games, we find complete financial systems that can illuminate a different perspective. For over two decades, MMO RPGs like World of Warcraft or EVE Online have had players ready to pay real money for anything from leveling up characters to obtaining in-game currency used to buy coveted items. Many skilled players treat these activities as their main source of income.

No platform is a better example of in-game time capitalization than Roblox, however. We could even see it as a bridge between what happens in web2 and what would be possible with web3 models.

Being more of a social platform than a game, Roblox has provided its users with an experience based on community-created content. Roblox allows players to create their own assets and monetize these products by gaining “Robux,” its in-game currency. After reaching a certain level, they can choose to convert these coins into real currency. This is an economy mostly powered by creators, allowing both parties (the company and the players) to earn their share.

Lo and behold, Roblox’s MAU reaches 300 million players. The platform has become the leisure activity of choice for a whole generation of new gamers in the Gen Z demographic. It turns out that providing players with freedom and tangible (financial) rewards for their creativity does create an enormous amount of user engagement. Its model has created the right balance between financial incentives and good gameplay. 

However, Roblox is not a blockchain-based project. Players do not own their creations and are forced to pay significant fees to obtain profits. As developers indicate on their website, only 29% of the sold asset’s value is returned directly to its creator. The rest is distributed to cover platform expenses or goes to the game developers’ pockets.

Web3 can balance incentives with gameplay

It’s easy to see how adopting a model like Roblox to include the benefits of having a decentralized and permissionless onchain economy could be the logical next step in the evolution of gaming. This could start by allowing players to manage their in-game assets and go as far as designing new in-game economies.

From a web3 perspective, this approach could also be the solution to the lack of quality in web3 games today. A platform that gathers users by providing them with the right incentives would leave game developers to focus and compete solely on designing the best gameplay. 

Currently, most web3 games are in the stage of searching for their path or, in the worst of cases, only attracting users in search of a quick buck. It’s no secret that this is what drives the success of certain categories, such as play to earn and now tap to earn. This has been very unappealing to a whole generation of gamers who never saw gameplay mixed with financial incentives.

However, younger users who are raised on titles such as Roblox, Fortnite, or Albion Online have different expectations. They also seek quality entertainment and opportunities to socialize with other players, but financial components are already a part of the game for them.

That is precisely where the new path for web3 gaming must be laid. GenZ players are already used to economic mechanics, and the demand for the possibility of capitalization will increase as time goes by. They are in the middle of the road. All we have to do is design platforms that improve the overall quality of the experience, and web3 gaming may well be the birthplace of the next Roblox.

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Offchain Labs unveils new platform to boost crypto adoption

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Offchain Labs, a venture-backed firm with traction across the crypto space, aims to boost further development and adoption of blockchain via a new platform dubbed Tandem.

The Offchain Labs developer team’s ecosystem footprint includes core contributions to the development of Prysm, a consensus client for Arbitrum (ARB) and Ethereum (ETH). Tandem is the team’s latest project aimed at bolstering blockchain innovation.

In September 2023, Offchain Labs teamed up with Espresso Systems, the platform behind the Espresso Sequencer, to help Ethereum rollups and developers achieve interoperability.

What does Tandem bring to the market?

With this new project, the team offers Tandem as a partner studio that will provide select projects with access to Offchain Labs’ resources and market presence to build and launch on-chain applications.

Tandem’s dedicated service will utilize Arbitrum Nitro’s execution layer, tapping into features such as data availability and Rollup-as-a-service (RaaS) for customizable scalability. RaaS helps projects scale their infrastructure to enhance network operations and settlement.

In a comment on Tandem’s mission, Offchain Labs co-founder and chief executive officer Steven Goldfeder said:

“By providing resources and mentorship, we aim to empower developers and entrepreneurs to bring their visionary ideas to life, driving the next wave of decentralized applications and transformative technologies. We are excited to see the groundbreaking projects that will emerge from this initiative.”

Projects that benefit from Tandem will have a dedicated stakeholder who will act as the “point person,” collaborating with the project from building to deployment. Additionally, projects will benefit from partnerships facilitated by Tandem.

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Bitcoin is the solution to an inevitable hyper-financialization | Opinion

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If there’s one thing that is becoming clear, it’s that hyper-financialization is inevitable, and our best chance to navigate it successfully is through Bitcoin (BTC). This decentralized cryptocurrency, which is known for its fixed supply and robust security, offers a unique solution to the upcoming problem of wealth inequality and concentration of power. By adopting Bitcoin, we can create a more transparent and resilient financial future, or we risk losing our financial sovereignty to a handful of corporations.

The hyper-financialization of the world has already begun with the financial sector becoming a relatively bigger part of the economy, growing in size and importance. Financial structures are now fast creeping up in other sectors as well. 

For instance, in 2023, Americans spent more than $100 billion on state-run lotteries, according to The Economist, which reported poorer citizens spent a staggering amount on tickets. Additionally, the online sports betting market, valued at over $100 billion, is projected to generate almost $46 billion in revenue this year, with a 3.9% user penetration. 

Moreover, Robinhood, a commission-free investing platform popular among retail, has seen its number of funded customers rise to 23.9 million and assets under custody surge to $129.6 billion, yet another prime example of the hyper-financialization trend. It was during the COVID-19 pandemic in 2020 that Robinhood started gaining traction, and the trend of hyper-financialization was exacerbated. For people stuck in their homes, the online world became their primary means of entertainment and social interaction. 

Then, the governments injected billions of dollars into the market, providing people with an incentive to bet their money on markets. The subsequent surge in inflation and the weak economy around the world have now further intensified this trend as people bear the burden of survival. 

It has led to a heightened proliferation of financial structures in different spheres of life, which means that both builders and consumers are taking this route. 

The crypto industry

As we can see in crypto, it has grown from less than $150 billion in March 2020 to now worth $2.7 trillion. This explosive growth is not only turbocharging the hyper financialization trend for finance with yield farming, restaking, points, rewards, and meme coins but also for art via NFTs, social dynamics through social tokens and platforms like Friendtech, gaming with play-to-earn concepts, and physical assets via tokenization.

Then, there are prediction markets that allow people to bet on all kinds of events. These range from the US 2024 Presidential election outcome to whether Bitcoin will hit $100k by year-end, if Drake’s verse in “Wah Gwan Delilah” is AI, what will be ‘Bad Boys: Ride or Die’ Opening Weekend Box Office, or if Fed will raise rates this year?

This growing trend of hyper-financialization is detrimental to society, given that it broadens the already widening wealth gap by increasing wealth concentration and contributing to economic inequality. Not to mention, this will lead to even bigger asset bubbles, short-term focus over long-term approach, and more interest in speculative investments. 

Here, crypto can help provide a better way to approach hyper-financialization. After all, middlemen are where the wealth lies, and the use of blockchain technology removes this third party from the equation, bringing trustlessness, traceability, and immutability to the market. Blockchain actually allows the hyper-financialization to be fair and transparent.

Before crypto, not everyone was allowed to participate in markets. But through disintermediation and permissionlessness, crypto has made markets more efficient and accessible. Not to mention, one gets total control over their data, mitigating the risk of data manipulation and privacy invasion.

A better way to deal with hyper-financialization

This is where Bitcoin provides the perfect solution. This decentralized peer-to-peer network enables financial inclusion and resistance to censorship, which is critically important in today’s world, where organizations and governments are encroaching on people’s rights. This network has a decade-and-a-half-long history behind it, offering a robust and secure platform for people to achieve financial sovereignty.

The trillion-dollar asset class further serves as a hedge against inflation, allowing holders to preserve their wealth over time. Unlike fiat currencies, which are devalued through policies, Bitcoin’s fixed supply and decentralization safeguard it from such pressures, making it the perfect asset to be owned in a world where everyone is competing to extract value.

The largest crypto network has now also been seeing experimentation as both developers and investors use it as a base to build a truly decentralized future of finance and value.

For so long, Bitcoin has been a low-activity blockchain, its key role being a store of value. While Bitcoin has been playing a passive role in the blockchain world all these years, it finally changed with the Taproot upgrade that brought NFTs into the BTC realm. Then there has been an increasing interest in tokenization, that too from institutions like Blackrock. 

This focus on expanding Bitcoin’s utility has sparked a wave of innovation, and the day is not far when BTC might dethrone Ethereum to become the go-to blockchain for decentralized finance. Several aspects, including Bitcoin’s robust security framework, widespread recognition, and institutional interest, are positioning Bitcoin at the forefront of defi innovation. 

So, with these developments, Bitcoin is now evolving to start its new era of utility and innovation after fulfilling its original vision of being a peer-to-peer electronic cash system. 

As everything turns into a financial asset and becomes tradable, attention, which is a scarce resource, will become even more critical. Bitcoin has already solidified its position in the attention economy, and the newfound interest in regulatory complaints and the widely adopted BTC to drive productivity will see it lead the future of digital economies. This points to a world where crypto is leading the charge for hyper-financialization, with BTC in the driver’s seat.

So, to conclude, the resilient Bitcoin network that survived the test of time spectacularly may have started as a way to facilitate the transparent flow of monetary value, but today, it has become a foundation of hope to not just protect yourself from a future that is going to be super fixated on financialization aspect but to take advantage of it to build wealth and thrive.

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Theo Crypto News

DeFi

From niche to necessity: Why defi literacy matters | Opinion

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Embarking on a journey into decentralized finance is akin to navigating a new and vast wilderness. Unlike traditional finance, defi offers a platform where everyone can be more than just a consumer; they can be active participants, decision-makers, and even innovators. For novices, this is an exhilarating but complex terrain. Structured education is not just helpful—it’s essential. It functions as a compass in the vast, sometimes perplexing landscape of defi.

The promise and perils of defi

Defi offers the allure of financial transactions without traditional intermediaries, promising greater efficiency and reduced costs. More significantly, it holds the potential to democratize finance. Defi provides essential services directly to consumers through blockchain-based smart contracts in regions where traditional banking systems falter. This empowerment, however, comes with substantial challenges.

Despite the total value locked (TVL) in defi, protocols have experienced massive fluctuations, peaking at over $180 billion in late 2021 and adjusting to market conditions with about $40 billion as of mid-2023, according to data from DefiLlama. This growth signifies a robust engagement, yet a significant gap in understanding persists.

Defi demystified: Mastering the basics

Diving into defi without understanding its foundational technology is like trying to navigate without a map. Structured educational programs help demystify this complex system by teaching the basics of blockchain, cryptocurrencies, and smart contracts in relatable terms. This grounding is crucial as it allows learners to grasp why defi can operate without traditional banks and how it offers enhanced transparency and security. Such knowledge is practical, equipping novices to make informed decisions and effectively manage their digital assets.

Risk management: Navigating safely

Autonomy in defi comes with significant responsibilities. The freedom to make financial decisions also includes the risk of making costly mistakes. Education in this field teaches critical risk management strategies and helps learners understand the volatility of crypto markets. For instance, novices learn about impermanent loss, the importance of due diligence, and how to spot potential scams—common pitfalls in the defi space. This knowledge is vital, as it protects individuals from the financial pitfalls that can occur when enthusiasm outpaces understanding.

Bridging the gap between theory and practice

Understanding defi concepts theoretically is one step; applying them is another. The best defi education bridges this gap through interactive learning—simulations, real-world case studies, and even sandbox environments where novices can practice transactions in a controlled setting. This hands-on approach is crucial for internalizing knowledge. It transforms theoretical understanding into practical skills, enabling learners to engage with real defi platforms confidently and competently.

The collective learning experience

Venturing into defi doesn’t have to be a solitary journey. Structured education often includes access to a community of learners and experts. This network acts as a dynamic support system where novices can ask questions, exchange ideas, and share insights. Such communities enhance the learning experience, keep members updated on the latest developments, and provide a forum for collaboration. In defi, where innovation happens rapidly, being part of a knowledgeable community helps individuals stay agile and informed.

Defi literacy is more crucial now than ever

The urgency for defi education stems from the sector’s rapid evolution and increasing relevance to everyday financial activities. As more financial instruments migrate to blockchain platforms, the line between traditional finance and defi blurs. Individuals who understand defi are better prepared to exploit emerging opportunities in this new financial paradigm.

Moreover, the global nature of defi makes it a powerful tool for financial inclusion. Due to stringent requirements or geographical barriers, traditional banking systems often exclude vast population segments. Defi, accessible to anyone with an internet connection, offers a viable alternative. Education in this sector equips people worldwide with the knowledge and tools to access financial services previously beyond their reach, fostering greater economic empowerment.

The path forward

The future of finance is increasingly decentralized. For novices, entering this new territory equipped with a comprehensive education in defi is not just beneficial; it’s imperative. This education goes beyond mere participation; it’s about thriving in a digital economy where those who understand and leverage defi principles can influence and lead.

Those on the brink of this financial revolution must remember that knowledge is power. In the context of defi, this is literal. Understanding how to navigate this landscape can lead to unprecedented control over your financial destiny. But it starts with education—structured, thorough, and continuously updated to keep pace with defi’s rapid evolution.

Thus, structured defi education isn’t merely about learning; it’s about transforming participation in the global financial ecosystem. It’s about preparing for a future where finance is not only digital but also decentralized, democratic, and diverse. This is why a structured educational approach is indispensable for anyone looking to navigate the promising yet complex world of defi. 

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Theo Crypto News

Bitcoin

WisdomTree CEO says crypto is going ‘mainstream’

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Jonathan Steinberg, the founder and CEO of WisdomTree, believes that crypto is going mainstream and that adoption will gather pace amid further regulatory clarity.

Steinberg shared this view during an interview with CNBC’s ‘Money Movers’, commenting on Bitcoin (BTC) performance and Trump’s speech at Bitcoin 2024. He also talked about crypto going mainstream as an asset class amid current trends such as tokenization.

Trump’s speech key, Steinberg says

According to Steinberg, former President Donald Trump’s speech at the Bitcoin 2024 conference last week struck an ambitious tone and highlighted the overall sentiment around cryptocurrency’s future.

The WisdomTree CEO lauded Trump’s pro-crypto stance, noting that more than just his appearance at the Bitcoin event, the Republican nominee added a top politician’s voice to the industry’s growth. Trump vowed to fire SEC chair Gary Gensler if he wins in November’s election.

“More importantly,” Steinberg said, ”is that he’s promising regulatory clarity for crypto and digital assets broadly. I think that will have a very positive effect, not just on the crypto asset class, which is only half of the story but also blockchain-enabled finance that WisdomTree is a very early leader in.”

Bitcoin best performing asset in 15 years

In Steinberg’s opinion, Bitcoin has showcased remarkable growth since its inception 15 years ago. Within this time, BTC has emerged as the best performing asset, beating private equity. But there’s more to this feat, Steinberg noted.

“What’s so interesting about Bitcoin, with no employees and no institutional buying, it raised more than a trillion dollars. And now crypto as an asset class is well over $2 trillion. I think it’s going mainstream and will continue to go mainstream in years ahead.”

Steinberg also commented on crypto adoption across the world.

According to him, there’s nothing really complex about crypto, blockchain or things like decentralized finance and tokenization. What has previously driven people away from embracing the market and the different ecosystems built around it, is the skepticism from regulators.

“There’s nothing more transparent than blockchain and bitcoin in general,” he explained.

In his opinion, regulatory clarity and the launch of crypto exchange-traded products are some of the factors that will see the digital asset class continue to go mainstream.

WisdomTree ETFs market growth

WisdomTree, which provides several ETPs, including a spot Bitcoin ETF, recently reported its total assets under management at over $109 billion.

The New York-based firm recorded net inflows of $1.9 billion for its U.S.-listed ETFs in the second quarter of 2024 and reached total net inflows of $4.2 billion into its ETFs.

According to data by SosoValue, the WisdomTree spot Bitcoin ETF BTCW currently holds over $89.3 million worth of Bitcoin and has recorded net inflows of over $72.5 million.

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Theo Crypto News

Công nghệ

Le Poisson Rouge brings ticketing on-chain with Aptos integration

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Le Poisson Rouge (LPR), an iconic music venue in New York City, has sealed an exclusive partnership with live event ticketing platform KYD Labs to bring its ticketing system on-chain.

On Tuesday, Aptos Labs announced that KYD Labs and LPR had entered an exclusive four-year deal that will see the Aptos blockchain power all of the historic NYC venue’s shows and tickets.

LPR is first major U.S. venue to go all on-chain

The collaboration is the first instance where a major U.S. venue has gone fully on-chain, the Aptos team posted on X. It’s a major milestone for Web3, Aptos added, with this partnership set to offer Le Poisson Rouge’s event goers and music fans a new experience.

“A major US venue with hundreds of thousands of tickets per year transitioning to on-chain ticketing is a big step forward for blockchain utility. Eventually, ticketing will all be on-chain. Better interoperability, directly connecting event organizers to buyers, easy promotions, and verified secondary sales are some big advantages,” Avery Ching, the CTO and co-founder of Aptos Labs, said.

KYD Labs will help LPR tap into the benefits of blockchain technology to improve the ticketing experience for fans. Leveraging Aptos’s technology will also be crucial to artists, who can further engage with fans via on-chain initiatives.

Going on-chain removes challenges and barriers associated with legacy ticketing systems.

Overall, LPR will leverage Aptos to not only monitor secondary ticket sales but also offer a transparent mechanism for its loyalty programs, pricing, and booking rates.

Le Poisson Rouge opened in 2008 and has grown into a historic music venue in New York. Aptos is a Layer-1 blockchain that launched in October 2022 and offers a scalable, low-transaction costs network.

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Theo Crypto News