Ethereum Based NFT Game, Axie Infinity, Raises $860,000 in Governance Token Sale

Top Ethereum-based crypto game Axie Infinity has raised $860,000 in its sale of AXS governance token.

The firm launched the AXS token officially this month on Uniswap and Binance. It was valued at $0.12 when it was first launched. But its current market price stands at $0.47, according to CoinGecko.

The fundraising was led by Delphi Digital and was necessary to make yield farming more simplistic. Other contributors to the funding include Sparg and Arca.

Axies’ are used like CryptoKitties, which are non-refundable tokens, symbolized by cryptographically distinguished cartoon characters that are almost difficult to find elsewhere. The NFT collectible creatures are rare, especially the Axie NFT, which was sold for 300 ETH ($1,300) this month.

Axie Infinity the only NFT project with over 10,000 users

Jeffrey Zirlin, the co-founder of Axie Infinity, commented on the achievement in an interview.

“We’ve overtaken CryptoKitties by quite a lot,” he said, adding that the company is the first Ethereum-based NFT project to cross the 10,000 level for monthly active users.

Based on information available on data site DappRader, Axie Infinity game currently maintains over 2,500 users per day, which makes it the most popular game on the Ethereum blockchain.

AXS token has been in development for two years

The AXS project may be coming when blockchain is taking center stage for the latest technology. But the Vietnam-based start, who also developed the Sky Mavis game, said the AXS token project began two years ago. According to Zirlin, the launch would have happened earlier, but the pandemic put a little hold on its development.

The scale of today’s governance token is coming amidst collaboration with Chainlink, announced a few days ago.

The announcement stated that Chainlink’s decentralized ETH/USD had been integrated into the game to make sure players always see the current price. The game also added Chainlink’s Verifiable Randomness Function (VRF) for more efficient in-game play involving breeding Axis.

Zirlin also said that the governance token’s primary goal is to bring everyone onboard by aligning their incentives. Core developers, content creators, and players can all have their aligned incentives, which the token will provide.

He also revealed that the tokens would have both fee-sharing features and governance functions, and the proceeds from such features will be sent to the Community Treasury.

Zirlin also confirmed the crypto gaming firm is about launching a new game mode, which will be available on the platform early next year. The game will feature an animal crossing-like setting, where the players can farm on virtual pieces of land to earn in-game tokens.

The play-to-earn approach is part of the game’s success.

Zirlin responded to questions about the game’s play-to-earn approach and said the process is one reason for its success.

According to him, players can spend time playing the Axie Infinity game to earn ERC-20 tokens, which is approximately $5 per hour.

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Author: Ali Raza

Uniswap (UNI) Farming to End Today, Billions of Dollars to be Released

Launched in the mid of September, the governance token of DEX Uniswap, UNI, is currently down over 10%. In the first week of November, the DeFi token crashed 72% from its all-time high, achieved right after its launch.

Since then, the 26th largest cryptocurrency by market cap of $803 million has doubled in value, trading at $3.56.

Uniswap actually has been the first DeFi project to hit $3 billion in total value locked (TVL), which is currently down at $2.84 billion. Meanwhile, it has 3.1 million ETH, 29.5k BTC, and nearly 190 million DAI locked.

The project, however, maintains its dominance in the market at 21.18%.

Interestingly, in the next few hours, UNI farming on Uniswap Protocol will end with about $1 billion to be released into the market.

As it stands, around $2.3 billion funds are deployed farming the native token, and with Ethereum being the reference token, it means there is currently $1.1 billion ETH locked. Although it remains to be seen how much ETH will actually leave, the portion that chooses to stay will get to enjoy the high fees.

This could still mean some selling pressure for Eth, which is trading just around $462, already “at resistance with a potential double top.”

DeFi-Inflow-of-Money
Source: IntoTheBlock

With this new influx of money flowing into the DeFi sector, it’s to be seen where it will exactly move to.

It is possible this money flow will potentially make its way to SushiSwap. While liquidity has been coming off its recent highs on Uniswap, SushiSwap’s liquidity has increased substantially.

Even SUSHI token is currently enjoying gains of over 17% at $1.36, up 109% month-to-date (MTD) basis compared to Uniswaps’ 62%.

However, both are still cheap when it comes to their valuations based on the price/sales ratio. While Uniswap P/S is around 10x and SushiSwap’s even much lower than that, its competitors like Curve and Balancer trade close to 80x.

In other news, over the weekend, the decentralized exchange Uniswap’s app interface went down due to issues with its gateway provider Cloudflare.

The automated market maker (AMM) built on top of Ethereum took to Twitter to share the outage issues and point out how “now is a good time to remember the benefits of decentralization.”

Unlike a CeFi, which, if goes down, has no way to access it, a “true DeFi on Ethereum there are no central points of failure” and “there is no downtime,” as pointed out by Uniswap creator Hayden Adams.

As can be seen with Uniswap, it is available on other IPFS gateways, can be run locally, easily be forked and re-hosted, and can be traded over Uniswap natively from Dharma and other Ethereum wallets. One can also trade on Uniswap through a wide range of aggregators, a command-line, and over Etherscan.

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Author: AnTy

BProtocol Uses $7 Million Flash Loan to Push Through Governance Vote On The Maker Platform

  • A first in the DeFi ecosystem, a protocol uses a flash loan to vote and influence its own governance decisions.

BProtocol Foundation, a platform concentrated on developing Bancor Network, raised a governance proposal vote on the Maker platform using a quick $7 million flash loan to pass its proposal. Maker warned users of the possibility of governance proposals being “rigged” through the use of flash loans following the successful vote completed by BProtocol last week.

BProtocol submitted a vote on Maker to be whitelisted to access the latter’s decentralized price oracle on October 23. To make it happen, the team manipulated the governance vote by borrowing a flash loan and voting for themselves – winning the vote. However, this raised questions on the negative impact of flash loans on the emerging DeFi space.

Flash loans are lending agreements that allow a user to borrow a certain amount of Ethereum and return it within the same block. These loans allow holders to simultaneously buy lower-priced tokens and sell them at a higher price on another platform. However, as seen in the latest and former exploits such as the bZx exchange, flash loans cause unexpected risks and security qualms across the largely untested DeFi ecosystem.

In BProtocol’s case, the team proposed the vote on October 23 and three days later carried out the flash loan. Here’s how it worked:

BProtocol locked 50,000 ETH tokens on dYdX exchange to borrow wrapped ETH, wETH. The team then transferred the wrapped Ether to Aave Protocol to borrow $7 million in Maker governance tokens, MKR. These tokens were then transferred and locked on Maker’s platform to vote on their whitelisting. Once the vote was complete, BProtocol unlocked the funds and paid back the loan.

In a statement on the flash loan vote by Maker, the DAO claimed the increase of flash loan attacks is causing a “risk of malicious governance action [becoming] unacceptably high.” At current times over 63,400 MKR tokens are at susceptible risk of being accessed in flash loans. Still, there is no risk of a governance attack yet – only new executive governance proposals are at risk when submitted. The statement reads,

“In the event of a malicious governance attack that leads to a redeployment of the Maker Protocol before the introduction of flash loan guards into the governance process.”

“The community and domain teams should do everything possible to burn the MKR involved in the attack, regardless of whether the owner was directly involved in the attack.”

Maker DAO is currently looking at solutions to prevent such security breaches and flash loans affecting the decentralized voting process. The team plans to increase the waiting time to execute a proposal from 12 hours to 72 hours to give the community enough time to rectify contentious proposals. They also plan to increase MKR on the hat proposal to over 100,000 MKR to prevent flash loans executions.

The executive plan to add Yearn.finance (YFI) and Balancer (BAL) as collateral on Maker has also been delayed due to the recent attacks.

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Author: Lujan Odera

UNI Shorts Get REKT As it Goes Into Price Discovery While Uniswap TVL Hits a Record $2B

It has been only three days since Uniswap launched its governance token UNI.

The free $1,200 crypto stimulus saw 32k accounts selling their 400 UNI instantly, under $5.

This much activity resulted in ETH gas fees skyrocketing to $11.60, yet again and seeing a level of congestion; the Ethereum network has “never” faced before. The good thing is ETH price also spiked to $392 amidst the ETH balance on exchanges reaching the lowest levels so far this year.

But what these sellers didn’t anticipate was the price discovery the token would go on. Yesterday, UNI hit an all-time high above $8.37, and currently, it is trading at $7.13.

“UNI shorts getting rekt. I’m pretty sure there’s a lot of farmers that leverage hedge yields because I do that often, but Jesus this chart looks like someone got rekt, futures were 35% below index and it teleported to the index in a few ticks,” noted trader CL.

These sellers also didn’t take notice of the fact that the decentralized exchange (DEX) handles the same level of volume as the top centralized exchanges such as Coinbase.

“There are VERY few productive assets in crypto space,” said Dovey Wan of Primitive Crypto. “Uniswap Protocol operational efficiency is an order of magnitude higher than Binance and Coinbase.”

Uniswap is currently the dominant force (19.4%) in the DeFi space with a record of $2 billion in TVL, as per DeBank.

This week, the volume on the platform is also gradually growing to over $600 million, which is much more than the likes of Coinbase, Gemini, Poloniex, and Bitfinex.

The token has already been listed on the top cryptocurrency exchanges with futures contracts, providing the opportunity to short or long the crypto asset. DeFi options protocol Opyn also launched the UNI put options.

“DeFi will devour CeFi, piece by piece. It will be very difficult for proprietary, closed platforms to compete with neutral, open infrastructure,” said Jake Chervinksy, a legal counsel at Compound Finance, about the ongoing development in the DeFi space.

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Author: AnTy

Coinbase Pro to Pass the Rising Network Fees Onto The Customer During Withdrawals

The launch of UNI, the governance token of Uniswap DEX, is having a big impact on the Ethereum network. The good thing is the price of Ether spiked to $393 today and is currently trading above $385. But it also resulted in congesting the network even more as a new all-time high of 1.32 million transactions were recorded on it.

Uniswap mania is making the network unusable as it puts further upward pressure on the already elevated fees, which had miners’ combined revenue set a new record, $938,000 in one hour yesterday. Denis Vinokourov of prime broker Bequant noted,

“As such, while the smaller and less efficient market participants may be struggling, the larger firms that are able to capitalise on inefficiencies and as indicated earlier, miners are making the most of the latest surge.”

In the light of increasing fees, Coinbase Pro also announced that from now, it would “pass along network fees directly to our customers.”

The gas fees that are paid directly to crypto miners to process transactions and secure the network has been historically absorbed by the exchange itself on behalf of its customers.

But “as crypto has begun to gain broader adoption in applications like DeFi, payments and other projects, networks have gotten busier,” which means longer wait times and higher fees “as users compete to get their transactions confirmed faster.”

Although the exchange does not change network fees for crypto transfers from one Coinbase account to another and Coinbase pro account still has no fee, “Coinbase Pro will charge a fee based on our estimate of the network transaction fees that we anticipate paying for each transaction,” it said.

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Author: AnTy

Rug-Pulled on the Latest YFI Clone, Soft Yearn (SFYI), After Rebase Gets Exploited

YFI, the governance token of Yearn Finance, is the most popular DeFi token, which currently has the highest value of $21,465 and is dubbed a “cash generation machine.”

Since its launch in mid-July, many copycats of this popular DeFi token have emerged, such as CREAM, Wifey, YFII, YFL, and others.

The latest knockoff has been Soft Yearn (SFYI), the adaptive yield-stable currency, which merges Yearn.Finance and Ampleforth. “As DeFi flourishes, the demand for YFI will increase exponentially. SYFI has a direct growth relationship to the prominent YFI token,” reads the website.

Being a soft pegged currency, whenever SYFI has a significant difference form the main currency’s price, the contract or expansion algorithm will converge the market price to the pegged price.

Ampleforth birthed based-finance, but it hasn’t been a success — elastic-finance means the supply of the token changes, and so does the number of tokens held by an investor.

Also, rebases have led to the collapse of the projects. It was last seen with YAM, which found a bug in its rebase function resulting in its crash.

But on Monday, the price crashed 100% from its peak of $174 last week to $0.00040, as per CoinGecko.

The crash happened due to what happened during the rebase period.

“During our first rebase at 8:00 UTC, September 3rd, 2020, a malicious actor bought 2 SYFI, and timed the adjustment of their token holdings with a Uniswap sell. During the transaction, the rebase applied, but Uniswap price remained unchanged, thus, the perpetrator’s sell was amplified to the extent of wiping out most of the liquidity provided in the Uniswap pool. The rebase itself was also incorrect. The YFI rate per SYFI was not streamlined properly,” shared the SYFI team on its Telegram.

The team behind the project is now offering a “very large sum” of ETH as a bounty who can identify and apprehend the wrongdoer.

Last week, they did a presale and raised 400 ETH with a supply of 60,000 SYFI, double of YFI. However, unlike YFI, which is completely decentralized, but much like an ICO, they distributed portions of the token supply to the team and for marketing.

However, like the YAM project, they aren’t going anywhere and are planning a migration. They are also proposing to recreate the SYFI token, airdrop the number of tokens they had before the rebase, add at least 250 ETH to the initial liquidity pool, and fix the rebase mechanism.

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Author: AnTy

Decentralized Finance (DeFi) is Reminiscent of Bitcoin in 2013: Coinbase Report

As we talked about the curious case of YFI, a governance token launched with zero supply and zero value, it is quickly becoming a favorite among the crypto market.

In less than a week, this valueless token has flown to the highest level of $4,660 today. At the time of writing, YFI has been trading at $3,316, as per CoinGecko. From nothing, it has gained a valuation of $88 million, with a maximum supply of 30,000 that the community is voting to cap at.

Some are expecting this DeFi token to rise to the Bitcoin level and, at an off chance, even hit $10,000 before the world’s leading digital currency.

YFI might be the latest hot token in the DeFi space. Still, the entire sector in itself has been pretty hot lately, so much so that it has pushed Ethereum usage and fees to hit new highs leading to periods of congestion and highlighting its scaling challenges.

Over the last month, DeFi protocols exploded with now nearly $4 billion total value locked (TVL) in the sector, as per DeFi Pulse. TVL recorded a growth of a whopping 113% in July.

DeFiPulse
Source: DeFiPulse

Also, the total Ether locked in DeFi protocols has exceeded 4 million ETH — a new all-time high, the same as 18.2k BTC, and 280.2 million DAI.

The reason behind this much demand is “yield farming,” which was triggered by Compound.

The decentralized finance (DeFi) protocols built on Ethereum hand over the governance in the form of tokens to its users to achieve decentralization. And “using a protocol to earn native platform tokens is known as ‘yield farming.’”

ETH Undervalued or has a questionable long-term security model?

In the DeFi ecosystem, the DEX volume rocketed over the last month and is now rivaling some centralized exchanges, thanks to yield farming — especially swapping between two different ERC-20 tokens, particularly stablecoins.

Stablecoins had a record Q2 growth, not only surpassing $12 billion in market value but also being used within DeFi. Both USDC and DAI market cap grow over 50%.

“DEXs provide liquidity for all DeFi tokens and projects. Token creation will likely outpace how quickly centralized exchanges can add them, making DEXs the natural playground for unique new assets and the long-tail of smaller assets,” stated Coinbase in its latest report.

Over the last seven days, DEXs did over $1 billion in total volume.

Also, the market cap of all ETH tokens exceeded the market of Ethereum itself. According to Coinbase, it may either “indicate ETH is undervalued,” or raise questions about its long-term security model.

DeFi may boast of activity, but not many people are using it, but even that is a good thing as it means there is more room for growth. Also, it has grown 100% YTD.

DeFi is a “prominent narrative” in crypto. In this industry, “Outsized financial incentives drive increased user awareness, and people run through brick walls to participate,” which leads to smoother onramps, more refined revenue models, and more user-friendly products over time.

According to the Coinbase report, it is reminiscent of what happened with Bitcoin in 2013 when only a select few understood it, but price movements drive awareness and growth.

“Today, DeFi returns are sparking similar levels of awareness, but only the crypto-sophisticated are running through hoops to capitalize,” it reads. “There is some fuzziness in the numbers, but the trend is hard to argue against.

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Author: AnTy

Amidst DeFi Boom, Binance Lists Two New Hot DeFi Tokens Maker (MKR) & DAI

Leading spot cryptocurrency exchange Binance is listing MakerDAO’s governance token Maker (MKR) and stablecoin DAI.

The exchange is adding support for eight trading pairs viz. MKR/BNB, MKR/BTC, MKR/BUSD, MKR/USDT, DAI/BNB, DAI/BTC, DAI/BUSD, and DAI/USDT.

This is no surprise given the ongoing DeFi crazy. Binance has been increasingly adding support for these projects, and as we reported, Binance CEO Changepeng “CZ” Zhao is a “very strong proponent” of this sector. However, he did warn that they are “very inherent high risk” and doesn’t see an “overwhelmingly large proportion” of them succeeding.

The DeFi sector actually surpassed $3 billion in total value locked this week, after reaching $2 billion earlier this month only. The hot trend in the DeFi market is yield farming, which is trying to get the highest yield from DeFi products.

The decentralized credit platform built on Ethereum, Maker, is back to dominating the DeFi space at 20.90%, a substantial loss from over 50% up until the launch of COMP token, which momentarily even took Maker’s place.

Also, the majority of ETH, 2.7 million ETH, out of the total 3.9 million ETH locked in DeFi, are in Maker protocol. However, when it comes to DAI, it’s the third biggest protocol with the highest amount of DAI locked at 21 million after Uniswap and InstaDapp.

The 27th largest cryptocurrency by market cap is also enjoying gains today, up 22.50% trading at $572.

Binance’s MKR listing came after Coinbase listed the digital asset last month and DAI a month before that. Both the tokens are also supported on DEXs like Balancer and Uniswap.

The USD pegged stablecoin DAI has been seeing an increase in supply by over 40 million since July 17th, which again is likely due to high demand for it in the DeFi ecosystem. Currently, DAI has a 7.47% supply APY on Compound, 4% to 6% higher than either USDT or USDC.

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Author: AnTy

Compound Backers Decreasing the Number of COMP Tokens Issued to Users After Price Explosion

COMP, the governance token of the lending platform Compound exploded in value after the US-based cryptocurrency exchange, Coinbase, listed it. In less than two weeks, the token went live on both the Coinbase retail and Pro platform and is now available on the firm’s Android and iOS apps.

This explosion was one of the fastest Coinbase listings ever since the launch of a digital asset.

Compound was actually the first-ever investment by Coinbase’s venture fund which was part of the $8.2 million seed round led by VC Andreessen Horowitz, crypto hedge fund Polychain Capital and Bain Capital Ventures.

COMP prices dropped 35% this week only to get a jump after the Coinbase listing and Binance’s announcement of opening trading for COMP/BTC, COMP/BNB, COMP/BUSD, and COMP/USDT.

COMP was launched on June 15 with an initial price of $80 that made an all-time high of $375 last weekend, which even Compound team didn’t expect, and is currently trading around $250.

For now, the token has formed a local top as crypto data tracker Santiment noted, “As is our golden rule, when an asset like COMP enters the top 3 on the @santimentfeed emerging trends list, it is generally indicative of an upcoming local top forming.”

The Long & Short of it

The governance token is awarded freely to both borrowers and lenders to incentivize people to use the Etereum-based platform. This led traders to borrow against themselves to receive free tokens.

In order to increase the prices further, traders were also buying COMP tokens from spot markets along with perpetual swaps, futures with no expiry on crypto derivatives exchange FTX.

“Because of the relatively large size of the COMP Perpetual Swap market, it would be profitable to buy the Perp and then buy spot in significant enough size to move the price, amplifying gains in the Perp and squeezing the shorts,” said Tony Sheng from Multicoin Capital. COMP price dropped the same day.

The Proposal

COM’s success saw its supplied assets growing from ~140M to ~870M and borrowed assets from ~30M to ~320M. And just a few days after the launch, a governance proposal 010 was created, succeeded, and is ready to be executed.

The proposal is to “change the reserve factor of BAT, ZRX, REP from 10% to 50%, and correct the COMP Distribution speed to 2,880 COMP/block as intended,” down from the current 3,297~ / day distributed COMP.

As per the proposal, the network encountered two problems; users concentrating extreme liquidation risk into the BAT (and ZRX) market, “placing the protocol in jeopardy” and the majority of existing users, who are using it “honestly”, are receiving little to no COMP Distribution.

Compound founder Robert Leshner proposed several solutions to the problems, including increasing the Reserve Factor on each asset, making interest rate models across all assets more uniform, and reducing the COMP speed.

He also proposed updating the distribution formula to “totalBorrows * USD Value” from “totalBorrows * borrowingRatePerBlock * USD Value.”

The proposal has been approved with 1,198,438 COMP votes, while 189,177 COMP was not in favor. But those in favor have been the ones that put their money into the project.

Given that, the team and investors of the project hold about 46% of the total tokens compared to mere ~0.03% of tokens issued every day; it was to be expected.

But now the question is, how decentralized is this DeFi (Decentralized Finance) project?

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Author: AnTy

Japan’s FSA Rolls Out New Initiative (BGIN) To Create ‘Open and Neutral’ Blockchain Dev

Japan’s Financial Services Agency (FSA), has announced the launch of the Blockchain Governance Initiative Network (BGIN). The regulator revealed this at the “BG2C – Special Online Broadcasting Panel Discussion,” held in collaboration with Nikkei on March 10.

According to Georgetown University Professor, Dr. Shin’ichiro Matsuo, this project is meant to create a sustainable ecosystem for blockchain tech development. The fundamental idea is to develop an open network that can facilitate dialogue between industry stakeholders.

Apart from a communication avenue, BGIN will serve as an archive for academic research and development on distributed ledgers. The project is set to create a common language which will enhance interaction and sharing of perspectives amongst network stakeholders like the JFSA;

“an open and neutral sphere for all blockchain stakeholders to deepen common understanding”

These developments are part of the G20 Osaka declaration where the JFSA spearheaded research initiatives around blockchain. The roundtable took place back in 2019 and prominent regulators across the world were in attendance. Some notable mentions include the United Kingdom, Singapore, Germany, and France.

Given Japan’s advanced crypto laws, BGIN is more likely to complement regulatory development so far. This open network will take blockchain discussions to distributed ledgers which means more input and consolidation within the industry.

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Author: Edwin Munyui