“Ethereum to Scale by 100X in the Coming Months,” Says Vitalik on Optimism Rollups Launch

“Ethereum to Scale by 100X in the Coming Months,” Says Vitalik on Optimism Rollups Launch

Ethereum co-founder Vitalik Buterin believes the blockchain is closing in on solving its scalability problem, predicting the Optimistic rollup launch in the coming month. The Optimism rollup is a layer two solution aiming to scale the blockchain by a factor of 100, which will solve the medium-term high gas fees as the community awaits the launch of Ethereum 2.0.

Speaking in a podcast aired on Tuesday, Buterin stated Ethereum 2.0 developers are working to integrate these layer two solutions, adding that the Optimism rollup will solve Ethereum’s scalability problems before sharding is introduced on ETH 2.0. He said,

“Rollups are coming very soon. We’re fully confident that by the time that we need any more scaling of that, sharding will have already been ready for a long time by then.”

Rollups are off-chain solutions that compute and store transactional data before bundling up the information and recording it on a blockchain. This reduces the data load on Ethereum, allowing transactions to be processed faster and lowers the fee paid per transaction.

The growth of decentralized finance (DeFi), yield farming, and recently non-fungible tokens (NFT) markets have seen the transaction fees on Ethereum skyrocket to all-time highs. The Optimistic rollup solution’s launch aims to reduce the high gas fees and mold ETH into a user-friendly and cheap form of currency.

According to Buterin, Optimism rollups will increase the blockchain’s scalability by 100 as the chain awaits the launch of sharding – once ETH 2.0 is fully launched.

“The thing to remember is that if you have rollups, but you do not have sharding, you still have 100X factor scaling, right? You still have the ability for the blockchain to go up to somewhere between 1,000 and 4,000 transactions a second, depending on how complex these transactions are.”

Optimism rollups only account for one of the layer two solutions currently in development – adding to Arbitrum’s scaling solutions and ZK rollups. The rollups have been in testing for the past year, and some projects have already integrated them, including Loopring and zkSync. Vitalik predicts Optimism rollups will be fully launched in the “coming months” given the progress already shown by the rollup.

Optimism rollups are expected to be embraced by some of the leading DeFi projects, including Uniswap, which recently launched its upgrade, Sushiswap, AAVE, and derivatives platform, Synthetix. MakerDAO, a borrowing and lending DeFi platform, also introduced its DAI stablecoin to Optimism rollups.

Despite increasing Ethereum’s scalability, Optimism still faces some challenges, in that transferring tokens from the main blockchain to L2 is easy. Still, the reverse process takes up to a week to complete the transaction. This is to allow for potential fraud proofs.

In a forum chat, the MakerDAO community looks to reduce the “reverse process” transaction time on DAI tokens on the L2 solution. The post reads,

“Introducing the Optimism Dai Bridge with Fast Withdrawals – a bridge which will allow locking up L1 DAI to mint L2 oDAI (Optimism-based DAI) as well as allowing oDAI to be burned in exchange for near-instant access to L1 DAI.”

The Optimism Dai Bridge with Fast withdrawals will be launched in the latter half of 2021, the post confirmed.

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Author: Lujan Odera

Robinhood Adds 6 Million New Crypto Users in First 2 Months; 2021 Starting With A Bang

Robinhood Adds 6 Million New Crypto Users in First 2 Months; 2021 Starting With A Bang

“The numbers are clear: 2021 has started with a crypto bang,” says the online brokerage.

Zero commission online brokerage Robinhood revealed that 6 million new users signed up for its cryptocurrency services in the first two months of this year.

The company launched its crypto services three years ago. Bitcoin (BTC), Bitcoin Cash (BCH), Bitcoin SV (BSV), Dogecoin (DOGE), Ethereum (ETH), Ethereum Classic (ETC), and Litecoin (LTC) are the only available cryptos on the platform.

Robinhood Crypto, which is licensed to engage in virtual currency business activity by the New York State Department of Financial Services, recorded high trading volume amidst a sharp rise in the prices of cryptos.

These numbers just show that much like crypto exchanges which have been registering a sustaining number of new peaks in new user sign-ups and volume, the crypto-mania has spread to everyone.

As we reported, in January, the global crypto users broke the milestone of 100 million, and this week, Square also revealed in its earnings report that its Cash App recorded 1 million new Bitcoin users in January 2021, adding to its 3 million throughout 2020.

As for Robinhood’s crypto division, they averaged about 200,000 new customers trading on its platform per month in 2020, the company said in a blog post. “The numbers are clear: 2021 has started with a crypto bang,” it said.

Robinhood crypto traders by year

Source: Robinhood

The average transaction size of crypto investors on the platform is around $500.

Robinhood, which also offers stock and options trading, currently allows its customers to only buy, sell, and hold cryptos and recently said it also plans to introduce the ability to deposit and withdraw cryptos to other wallets.

The company is expected to go public this year, with a value of over $20 billion, nowhere near the more than $100 billion valuation crypto exchange Coinbase got. The largest crypto exchange in the US, Coinbase, filed to go public with Nasdaq through a direct listing on Thursday.

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Author: AnTy

Privacy Browser Brave Unknowingly Leaked Users’ Dark Web Activities: Researchers

Privacy-oriented web browser Brave has been leaking users’ web data for months unknowingly through a bug in its code. The bug named Support CNAME, which was incorporated into its Tor mode offering had been sending user data to local network providers without the company knowing.

Leaked DNS Requests

Tor mode on Brave Browser allows users to access hidden services better known as .onion dark web domains while using Brave’s private browsing windows. The feature, which was added in 2018, was created to ensure increased privacy for Brave users while surfing the web.

But in recent research revealed on Friday for the Brave stable build, a Reddit user said Brave’s Tor mode was re-routing web queries for .onion domains to public internet domain name system (DNS) resolvers rather than designated Tor nodes.

Although the claims were initially refuted, other security experts confirmed the issue and asked the privacy browser to do something about it.

A DNS leak occurs when a request that should be sent through a private network arrives at a DNS server unprotected. The DNS server is likely your local network provider who will likely collect, evaluate and possibly sell the data. A DNS leak also leaves a trail that can be traced by government officials, hackers, or anyone with top-level security clearance.

To address this sort of issue, the Tor network was created in 2002. This network directs your web traffic through myriads of nodes, hiding the location you are searching from and protecting against network surveillance and traffic analysis.

Brave Browser has subsequently addressed the issue and released a formal fix for the erring bug the same day the data leak was discovered. The company said it first found the CNAME bug in its Brave Nightly build which developers mainly use. The issue was fixed on Feb. 4, and it proceeded to look into the stable build. It delayed the fix because it looked for other likely bugs that may result from the data leak.

The company has advised users genuinely concerned about their privacy to use the Tor network instead.

Brave’s User Community Grows By 130%

But despite what might seem like a bad deal for the ads blocking browser, Brave browser has enjoyed some measure of success in 2021. In a published report, the privacy portal said it has seen its user community increase from 11.6 million to 25.4 million as of Feb. 2 reflecting a 130% increase.

The Brave browser is sometimes compared to the famous Tor network due to its privacy-centric business model. Its Tor mode deployment in 2018 has seen it become a household name in a few short years.

The Chromium-based browser also rewards its users a basic attention token (BAT) for accepting to view ads. These digital tokens can then be exchanged for other crypto-assets or given to content creators through its in-built wallet.

With the idea of privacy becoming a much-discussed topic in the last decade, Brave may continue to find itself in business for a long time to come.

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Author: Jimmy Aki

“Outrageous Demand” for Bitcoin & Crypto from Retirement IRAs

  • Grayscale continues to add Bitcoin to its stash, currently holding 570,860 BTC.
  • In the past six months, GBTC’s holdings have grown by 56% to represent more than 3% of Bitcoin’s circulating supply.

As we reported, Michael Sonnenshein, Managing Director of the Grayscale Investments, said the most extensive digital assets manager had seen inflows that “are now probably up 6x what they were last year.” Sonnenshein said in an interview on Thursday,

“It’s some of the world’s largest investors and the allocations that they’re making are bigger than we’ve ever seen before and their time horizon for this is generally something over the medium to longer-term.”

This growing demand can be further seen in the premium that people pay to get exposure to digital assets through Grayscale.

GBTC shares are currently trading at a premium of more than 30%. This premium has been slowly grinding up since early October, when it was just around 6%. However, we are nowhere near the 132% premium people paid in March 2017. On-chain analyst Willy Woo said,

“Wow 33% GBTC premium, that’s outrageous demand for Bitcoin via retirement IRAs.”

“If I was a Euro Pacific shareholder I’d be wondering why the company is not getting in on that obvious growth business. Like Kodak revolutionized photos until one day it didn’t run towards digital.”

However, it’s not just Bitcoin that Grayscale users are after. The premium on other products is even higher than GBTC except for its BCH product, which is actually on a discount (-13%).

ETHE is trading at 170% premium, ETCG 43%, and LTCN at the most significant 2,259% premium. Trader and economist Alex Kruger said,

“When crypto heats up, premiums to Net Asset Value (NAV) for Grayscale products skyrocket.”

“Driven by dumb money buying Grayscale products from a brokerage.”

Grayscale is currently holding 2.94 million ETH, 948.34k LTC, 12.29 million ETC, 225k BCH, 35.65 million XRP, 18.94 million XLM, 192.7k ZEC, and 450.11k ZEN.

In an attempt to protect the average folk by restricting access to asset purchases, SEC has ended up creating “a racket where the many subsidize the few,” said Alex Kruger. Because primary issuance is for accredited investors, an average person has to buy in the secondary market to pay a premium.

The institutions that are buying GBTC do so directly from Grayscale at a 2% fee with a 6-month lock-up but gain a premium twice a year.

The crypto market has repeatedly pointed out that more competition and ETF getting approval from the US Securities and Exchange Commission will push these premiums down.

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Author: AnTy

Cryptocurrency Exchange Coinbase Files S-1 Form With SEC for Potential IPO

After months of speculation, Coinbase, the largest cryptocurrency exchange in North America, has confidentially filed for a public listing. Per an official blog post from the exchange, Coinbase revealed that it had completed its S-1 Filing and shipped it off to the Securities and Exchange Commission (SEC).

Not There Yet

The company pointed out that the filing will be effective following a review from the regulator.

The SEC Form S-1 is the initial registration form for companies planning on floating their IPOs to register their securities with the SEC.

It’s a prerequisite for companies before they list on any of the country’s stock exchange platforms. It contains details such as planned use of capital proceeds, company business model, and competitors. The form also features details like the methodology for arriving at the offering price and possible dilutions to other listed securities.

The Crypto Space is Ripe for IPOs

This isn’t the first time that Coinbase will be linked to an imminent IPO. In July, Reuters reported that the company was working towards a public listing, which would occur either later this year or in the first half of 2021.

At the time, Coinbase was looking to hire investment banks and law firms to guide the exchange in the process. It was also reported then that the company was considering a direct listing, which offers the opportunity of selling existing shares without offering new ones. Direct listings have become popular recently as an alternative to the traditional IPO.

Coinbase’s filing couldn’t have come at a better time considering Bitcoin’s recent rally. BTC broke its all-time high yesterday and has sat pretty above the $20,000 mark since then. With the leading cryptocurrency – as well as several other large-cap assets – expected to maintain their hot streak for the next few weeks, the crypto market is as vibrant as it has ever been.

Coinbase isn’t the only crypto-facing company that is working towards a possible listing. As Bitcoin Exchange Guide reported this week, Robinhood, the renowned crypto-friendly trading platform, had also made significant progress in pushing for a public listing. Robinhood had tapped Wall Street investment bank Goldman Sachs to lead the public offering, with the firm hoping to list in the coming months.

Robinhood plans to raise about $20 billion in its IPO valuation. Subject to market conditions, the Menlo Park-based company hopes to get on with the listing as soon as possible in 2021.

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Author: Jimmy Aki

Here’s Why Another Dump is ‘Extremely Bullish’ for Bitcoin

Besides being healthy for the Bitcoin price after an 85% uptrend in less than two months and mirroring the 2017 bull market when there had been an average of 30% pullbacks, another decline in BTC price means it is acting just like gold.

The crypto market has long been pointing how Bitcoin is the digital gold not only because it is now the hedge against inflation and in limited supply, but because the price of the digital asset also follows the same trajectory as the precious metal.

This has been pointed out by legendary investor Paul Tudor Jones in May when he announced that he had become a Bitcoiner and Tom Fitzpatrick, the Managing Director of Citibank, in his call for $300k per Bitcoin.

And this is why this is all bullish dumping.

“Any continued dump in BTC would be extremely bullish as it would reveal we are following the gold fractal from the 1970s, as per below by Paul Tudor Jones–the legendary macro investor who successfully used fractals to predict the 1980s stock market supercycle,” said Su Zu, chief executive officer of Three Arrows Capital.

This week, while the stock market made a new all-time high, Bitcoin lost big time, seeing a drop of 17% to nearly $16,300 level.

But Bitcoin wasn’t the only one; bullion has been falling for months now, going to $1,774 today — down 13.5% from its ATH in August. BTC, which climbed to $19,500 on Wednesday, is currently down 17% from its record high.

Even the greenback has gone down to 91.75, touching a three-month low and closing its lowest since April 2018.

“Over the longer term, this is probably the right trend for the dollar. We think the dollar has further room to the downside,” said Bipan Rai, North America head of foreign exchange strategy at CIBC Capital Markets.

Coming back to Bitcoin, it is trading above $17,150, as of writing, up over 1% with $2.59 billion in volume.

But of course, the pain is not over, and we can decline as much as to $13,500. The market, however, is uncovered and busy buying the dips.

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Author: AnTy

Crypto Network Fees on the Rise After DeFi Sees Signs of Another Parabolic Action

DeFi is popping again.

After two months of downward price action, DeFi tokens are bouncing back. The market cap of DeFi governance tokens that bottomed on Nov. 4 at just under $5 billion has managed to now double, at $10.2 million, in aggregate market cap in less than two weeks.

DeFi MarketCap
Source: CoinMetrics

Total notional value deposited across DeFi also hit an all-time high at about $14 billion this past week.

The growth stagnated in October and early November, but an increase in DeFi activity can be seen again in the past two weeks that helped it push to new highs.

This is because DeFi tokens are rallying again after witnessing large declines in market value. Over the past week, SUSHI gained more than 100%, SWRVE 88%, CRV 52%, and Hegic 45%.

At the beginning of summer, DeFi tokens were red hot as various assets recorded over 300% gains in a few months. Now, this parabolic action seems to be returning after a cool-off period of two months.

The return of bulls has the network fees also returning to healthy levels. Ethereum topped the list, generating nearly $2 million in daily fees, as per TradeBlock.

On Uniswap, the fees are back above $1,000,000 per day after declining to under $500,000 per day last month. Much like Uniswap, SushiSwap is generating over $100,000 in fees after declining to lows as liquidity across its platform decreased.

The Q4 also saw a new platform, Playmarket, joining the list of fee-generating crypto platforms for the first time. The Ethereum based betting platform saw an uptick in fees after the US presidential election, which brought its presidential betting market to the mainstream.

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Author: AnTy

Binance’s Mining Pool Becomes 4th Largest One Amidst ‘More Adoption & Institutional Participation’

Launched less than seven months back, Binance Mining Pool is currently the 4th largest one with a hash rate share of 11.36% after Antpool, Poolin, and F2Pool.

The leading spot cryptocurrency exchange Binance launched its own mining pool in April this year, which at the time was the 11th largest one, accounting for less than 4% share.

At the time when the pool finally went public, Spencer Noon of DTC Capital had shared his skepticism towards saying the “galaxy brain power move” by Binance CEO Changpeng Zhao makes him nervous because this might led to exchange-owned mining pools to “prioritize their own transactions or even censor transactions to competitor exchanges.”

Recently, as we reported, a new Bitcoin mining pool actually promotes censoring certain Bitcoin transactions, which the community is against.

The increased market share is achieved by Binance amidst the bull run with Bitcoin up 120% YTD and ETH 253%.

As a result of the greens, the market has been experiencing heightened volume and interest from the likes of PayPal and legendary investors, including Stanley Druckenmiller and Ben Miller.

“Right now, we are definitely seeing more users come in, more adoption happening, and more institutional participation,” said “CZ” in an interview. “Overall, things are going pretty well, I would say.”

Regulatory Aspect

Amidst this, Binance.US also expanded its services to the 10.5 million residents of North Carolina, now serving over 80% of the US.

Binance.US first opened the registration to the United States users in Sept. 2019, but residents of the 13 states, including North Carolina, were excluded due to local rules and regulations.

Binance.US is an independent entity that is fully compliant in the US, according to Zhao, who said in an interview with Bloomberg that they are hopeful they will be able to get the licenses to offer its services in other left-out states as well.

Recently, as we reported, Binance started blocking the users who are US citizens, which according to Zhao, they have “always” done.

“But users do find intelligent ways to get around our block sometimes, and we just have to be smarter about the way we block,” he said.

“Basically, we do continually try to improve our blocking. There are sometimes a few guys who want to circumvent our blocking and still use the platform, and we have to come up with a smarter way to protect that, and when we do, we block them.”

As for China making new moves to regulate the crypto market, it doesn’t impact Binance’s operations because the exchange is not in Hong Kong, said Zhao.

“Our position is usually we want to see other smaller exchanges to succeed first in any geographic location, and then we will expand our services potentially to cover those regions as well,” he said.

But still, the Asia market “is pretty significant,” an estimated 25% to 40% of daily trading volume originating there, he said.

Commenting on China’s digital yuan plans, Zhao said the country is “way ahead” of other countries, which will put pressure on others. Being the first one to have a CBDC will mean attracting a lot of international usage and volumes, he added.

“This probably will help significantly in making RMB a more dominant currency in the world, and if that works, then I think that will put pressure on other central banks to get their own central bank digital currency out as soon as possible.”

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Author: AnTy

DeFi Hacks Rise from Trivial to $98 Million in 2020: CipherTrace Report

In the last 10 months of 2020, losses from cryptocurrency hacks, thefts, and frauds have declined a good $1.8 billion compared to last year. But at the same, the crimes in the “decentralized finance” (DeFi) sector jumped.

Crypto crime reached $4.5 billion globally in 2019, as per the report from crypto intelligence company CipherTrace.

“What we have seen is that exchanges and other cryptocurrency players have implemented more security procedures,” Dave Jevans, CipherTrace’s chief executive officer, told Reuters.

“They have taken the guidance and implemented the procedures to secure their funds better. So you’re going to see less mass-scale hacks.”

So far, in 2020, losses from thefts and hacks increased to $468 million, excluding fraud and misappropriation of funds. This is a jump of 30% from $361 million in the entire last year.

20% of these hacks, at around $98 million, belong to DeFi space, which currently has a record of $13 billion of total value locked (TVL), as per DeFi Pulse. The sector has grown by 1,825% since the beginning of this year.

The DeFi mania attracted criminal hackers to space, which resulted in the most hacks for the sector this year. In 2019, the DeFi hacks were negligible.

“Companies and individuals have rushed DeFi products to market that have not gone through security verification and validation,” said Jevans. “So people are figuring out that there’s a weakness here.”

After a crazy bull run in August that topped out the next month, this week, as Bitcoin’s price took a breather following its run-up to almost $16,000, DeFi tokens are yet again enjoying a hot rally.

Some of the blue-chip DeFi tokens are up 60% to over 100% this past week, as per Messari.

According to Jevans, because of these networks being permissionless by designs, they can easily become a haven for money launderers.

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Author: AnTy

Here’s Why BTC and Gold are Getting Hammered while Stock Market Hits New ATHs

On Monday, US markets saw one of their strongest openings in months on the back of progress on the COVID-19 vaccine and Democrat Joe Biden’s electoral victory.

Markets soared even before they opened and after that, it was all-time new highs.

S&P 500 made a new peak at 3,628 with a 1.3% move today, beating early September’s record of 3,580.

Much like the equity market, Dow Jones hit a new high at 29,632, with a 1.8% upwards move while tech-heavy Nasdaq fell short of hitting its high.

Not just US stocks but global stocks also surged on Monday after drugmaker Pfizer said that early data from its coronavirus vaccine shows it is more than 90% effective.

France’s CAC 40 jumped 7%, Germany’s DAX climbed 5.4%, and the FTSE 100 in London spiked 4.7%.

Even the price of Brent crude oil vaulted nearly 8% to $42.45 a barrel.

Unlike the mania seen in the stock market, gold crashed hard. The precious metal took a dive to $1,850, with a drop of almost 5.8%. Much like the yellow metal, silver had a bad time today, falling 9.2% to $23.6.

The US Dollar index meanwhile only oscillated between 92 and 93.

When it comes to Bitcoin, initially, it held strong only to fall 6.5% on Bitstamp. Today, BTC moved between the range of $14,824 and $15,854. The leading digital asset remains 24% away from its ATH.

“This volatility is just fast money funds that play BTC as a higher beta GOLD dumping on vaccine news. The players that enter on behalf of the longer-term thesis for Bitcoin are not changing their positioning,” noted trader Cantering Clark.

At the time of writing, BTC/USD has been trading around $15,200 in the red (-2%) with $3.81 billion in volume.

BTC’s downward movement had altcoins trailing down as well, with top cryptos down between 3% to 8%.

Before the vaccine news even broke out, stocks were already rallying as investors reacted positively to political certainty following Joe Biden’s victory. During his victory speech on Saturday, Biden announced his plans to assemble a coronavirus task force to help curb the virus’s spread.

Coronavirus cases are rising at an alarming rate in the US, forcing some states to shut down parts of the economy. Recently, several major countries in Europe have imposed nationwide lockdowns again.

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Author: AnTy