Understanding the variety and functionality of TRON wallets requires a deeper exploration of the TRON ecosystem. Founded by Justin Sun, the mastermind behind the Peiwo app, TRON has quickly ascended in the blockchain world. Sun, along with advisors from Ripple and a team with roots in Alibaba, Tencent, and Baidu, has built an ecosystem focused on decentralization, aimed at revolutionizing digital content distribution.

This ambitious project leverages blockchain to provide a platform for digital entertainment, challenging traditional powerhouses like YouTube and iTunes.

The vision and mission of TRON: decentralizing digital entertainment

TRON’s inception was more than just launching another cryptocurrency; it was about reshaping the digital entertainment landscape. Justin Sun’s vision was to create a decentralized platform that empowers content creators and consumers alike, free from the control of traditional digital giants.

The TRON blockchain is engineered to handle smart contracts efficiently, offering a high-speed, secure, and censorship-resistant alternative to existing platforms. At the heart of this ecosystem is the Tronix token (TRX), designed to incentivize and fairly distribute income among content creators.

TRX’s capability to process up to 2000 transactions per second starkly contrasts with Bitcoin’s and Ethereum’s limitations, positioning it as a formidable rival to Ethereum, EOS, and NEO. Furthermore, the energy consumption for transactions on TRON is often negligible, making it an economically efficient option.

With a market cap exceeding $5 billion, TRON is carving its niche as a potent force in the crypto world, challenging established norms and fostering a more equitable digital content environment. For those interested in the financial potential of investing in TRON, a crypto gain calculator can help estimate possible returns.

A look at the different types of TRON wallets

Navigating through the array of TRON wallets can be a journey of discovery for any crypto enthusiast. Each type of TRON cryptocurrency wallet, with its distinct features, caters to various user needs, balancing between security and convenience. Hardware wallets, for instance, offer robust security by storing private keys offline. These physical devices, although secure and less prone to hacking, might not be the go-to for daily transactions due to their need for physical connection and their cost, ranging from $40 to $400.

Web wallets, on the other hand, present a more accessible option. Operating as browser extensions or through websites, they simplify the process of conducting quick, regular transactions. However, this convenience comes at a price – a higher susceptibility to hacking, as they are essentially hot wallets with server-stored information.

Desktop wallets offer a middle ground. Installed as software on computers, they store private keys directly on the device, enhancing security. While they require an internet connection to operate, if used on an offline computer, they can mimic the security level of hardware wallets.

Lastly, mobile wallets bring the convenience of managing TRX on the go, with local data storage boosting security. However, their vulnerability to public network risks should be considered, making additional security measures like VPN usage advisable.

The revolutionary TRX Tron wallet by CryptoStake

Established in 2017, TRX is not just a cryptocurrency; it’s a gateway to efficient and cost-effective digital transactions. The CryptoStake app’s TRX wallet is a testament to this, offering a blend of speed, security, and affordability.

Fast and economical transactions:

TRX distinguishes itself with its lightning-fast processing capabilities, handling up to 2000 transactions per second. This performance is paired with remarkably low transaction fees, setting TRX apart from other major cryptocurrencies that often impose significant charges.

Enhanced security and privacy:

Security is paramount in the TRON network, which employs blockchain technology to ensure secure, decentralized ledger transactions. The CryptoStake TRX wallet upholds these principles, providing a secure environment for transactions.

Seamless integration with CryptoStake mobile app:

Accessibility is another hallmark of the CryptoStake TRX wallet. Available for download on both iOS and Android platforms, it integrates seamlessly into the CryptoStake mobile app, combining convenience with robust security features. This integration offers users a superior experience in managing their TRX holdings, effortlessly blending ease of use with top-notch security.

The TRON wallet app: a blend of accessibility and security

Selecting the best TRON wallet hinges on various factors, including frequency of use, cost considerations, and the desired balance between security and ease of use. The CryptoStake TRON wallet app stands out in this regard, offering a harmonious blend of accessibility and fortified security for iOS and Android users.

Non-Custodial Solution for Maximum Security:

CryptoStake’s wallet for TRON (TRX) is a non-custodial solution, ensuring that users retain complete control over their funds. This approach significantly enhances security, as users have sole access to their private keys.

Privacy-focused transactions:

Privacy is a cornerstone of the CryptoStake TRX wallet. Emphasizing user anonymity, the wallet does not collect personal data, thereby ensuring transactional privacy.

Biometric security features:

For an added layer of security, CryptoStake integrates advanced biometric features. This ensures that each transaction involving the TRX wallet address is not only secure but also user-authenticated.

Hacken-tested impeccable security:

Underpinning its commitment to safety, the CryptoStake TRON TRX wallet app has been rigorously tested by Hacken, earning top marks for its robust security measures.

Intuitive user interface:

Navigating the CryptoStake wallet app is a breeze, thanks to its user-friendly interface. Available on both major mobile platforms, the app allows easy management of TRX holdings, combining convenience and security in a single package.

Getting started with CryptoStake:

Beginning your journey with the CryptoStake TRX wallet is straightforward. Download the app, create a secure vault with a recovery phrase, set a strong password, and navigate effortlessly through the wallet’s features for efficient TRX transactions and real-time market insights.

The post Exploring TRON (TRX) Wallets and the Ecosystem: A Comprehensive Guide appeared first on P&R_one.

Telegram has become one of the most popular platforms for cryptocurrency marketing and community building. With its focus on privacy, security and flexibility, Telegram offers a unique environment for crypto projects to interact with their community.

What is Crypto Telegram Marketing?

Crypto Telegram marketing refers to promotional activities and community engagement tactics employed by cryptocurrency projects on the Telegram platform. This includes setting up Telegram channels and groups, creating engaging content, running contests and giveaways, collaborating with influencers, and utilizing Telegram ads to reach new users.

The goal of crypto Telegram marketing is to build an active community of users interested in the cryptocurrency project and encourage participation, conversation, and advocacy. An engaged Telegram community can help drive awareness, adoption, and valuation for crypto projects.

Why is Crypto Telegram Marketing important for businesses?

There are several key reasons why Telegram has become a critical marketing channel for crypto projects:

• Large existing user base: Telegram already has an established critical mass of hundreds of millions of users globally, providing access to a wide target audience for crypto projects.
• Cryptocurrency focus: The platform is widely used specifically by cryptocurrency enthusiasts, making it efficient for targeting crypto communities.
• Security and privacy: Telegram offers end-to-end encryption for chats and does not sell user data, appealing to the privacy preferences of many crypto users.
• Global accessibility: Available across platforms like mobile, desktop, and web, Telegram can be accessed by users internationally, which suits the borderless nature of cryptocurrencies.
• Customizable and flexible: Telegram channels, groups, bots etc allow crypto projects to tailor communication strategies and create unique experiences and engagement opportunities.

Ask professionals, join community

Developing a crypto-related brand in today’s digital landscape can be a highly rewarding yet challenging endeavour. Navigating through the intricacies of blockchain technology and crypto marketing requires a solid foundation of knowledge and a network of like-minded individuals. Fortunately, there are resources and communities that can significantly ease this journey. One such resource is Scalefinal, a brand that has established itself as a beacon in the realm of digital marketing.

Scalefinal initially emerged as an essay writing service in 2016, but with a relentless pursuit of excellence, it expanded its expertise over the years. By 2017, it delved into SEO services, further extending to content creation for websites and blogs. Its journey saw a significant milestone in 2021, with the rise of cryptocurrencies, where Scalefinal decoded the crypto conundrum by excelling in delivering top-notch SEO services tailored for the crypto niche. In 2022, it morphed into a full-fledged agency providing thoroughly researched content. With a team of seasoned professionals, it now offers a variety of services including content marketing, PR services, and SEO services among others, ensuring brands reach their full potential in the digital space​.

Understanding the dynamics of crypto marketing is crucial, and one effective way to stay updated and interact with the crypto community is through Telegram groups. Telegram, with its privacy-centric messaging platform, has become a hub for crypto enthusiasts, traders, and marketers. There are several notable Telegram groups where you can immerse yourself in the ongoing crypto conversations, learn from seasoned traders, and even promote your crypto-related brand.

Best telegram groups like B2C/Jacob Crypto Bury, Crypto Inner Circle, and TRON Official Main Group among others, offer platforms where crypto enthusiasts discuss market trends, blockchain technology, ICOs, and various promotional strategies. These groups are not only platforms for learning but also offer potential promotional opportunities for your crypto brand.

Additionally, immersing oneself in the Scalefinal crypto marketing ecosystem can provide a wealth of knowledge and professional assistance in scaling your brand to unparalleled heights. Their expertise in SEO, content marketing, and PR can significantly boost your brand’s visibility and reputation in the crypto space.

In summary, leveraging the resources offered by Scalefinal along with actively participating in reputable Telegram groups can significantly propel your brand in the crypto domain. It’s a blend of self-education, community engagement, and professional assistance that will navigate you through the exciting yet complex world of crypto marketing.

Setting up a Telegram Channel

The first step in Telegram crypto marketing is setting up an official channel for your project. Here is how to go about it:

Creating a Telegram account

• Go to the Telegram website or download the mobile app
• Sign up with your name, phone number and password

Setting up a Telegram channel

• In Telegram, search for @BotFather and start the bot
• Type “/newchannel” and enter a name for your channel
• The bot will generate a link for your new channel

Customizing your Telegram channel

• Add a profile photo, description, and other details
• Set community rules and guidelines where needed
• Enable slow mode to manage spam

Growing your Telegram Community

With your channel set up, it’s time to build your community. Here are tips on how to do it:

Identifying your target audience

• Define the key demographics and interests of your ideal followers
• Conduct market research to understand your audience’s needs and preferences

Creating engaging content for your Telegram channel

• Share project updates, news, AMAs, FAQs, infographics
• Post text, images, audio, videos, polls to add variety
• Respond to comments and questions from your followers

Encouraging user engagement and interaction

• Reward reactions and comments with tokens or NFTs
• Ask for feedback on key decisions and features
• Organize Telegram AMAs and Space discussions

Growing your Telegram community

• Promote your channel on other social platforms
• Partner with influencers and key opinion leaders
• Engage with other popular Telegram channels
• Leverage Telegram ads and marketing tools

Marketing Strategies for Telegram

To maximize the growth and impact of your Telegram community, various promotional tactics and tools can be utilized:

Promoting your Telegram channel

• Share the channel link prominently on your website and other marketing assets
• Spread awareness through email campaigns and social media posts
• Distribute promotional stickers and graphics

Running Telegram contests and giveaways

• Offer prizes like tokens, NFTs, or merchandise for winners
• Require followers to complete actions like invitations or content creation to enter
• Announce the contests in your channel and on social media

Collaborating with other Telegram channels

• Partner with channels in related niches for cross-promotions
• Sponsor content on aligned channels to reach their audiences
• Offer exclusive content for collaborating channels

Using Telegram ads to reach a wider audience

• Create Telegram-enabled ads linking to your channel
• Display these ads on high-traffic Telegram channels
• Target based on user demographics and interests

Measuring Success on Telegram

It’s crucial to track key metrics to assess the performance of your Telegram marketing initiatives:

Tracking Telegram channel growth and engagement

• Monitor total subscribers, growth rate, views and interactions
• Measure user posts, comments, shares, reactions on content
• Check click-through rates on channel links

Analyzing Telegram channel metrics

• Review impressions, reach, views, saves and forwards for your content
• Evaluate engagement rates and response times
• Audit traffic sources driving channel subscribers

Using data to optimize your Telegram marketing strategy

• Identify best-performing content formats and topics
• Assess which promotion channels deliver the highest ROI
• Double down on tactics working well and improve poor performers

Best Practices for Crypto Telegram Marketing

To maximize the impact of your crypto marketing on Telegram, these practices are recommended:

Dos for Crypto Telegram Marketing

• Respond to user questions and feedback promptly
• Post content regularly to keep community engaged
• Utilize bots for automation of repetitive tasks
• Collaborate with popular crypto influencers
• Offer exclusive benefits for channel subscribers

Don’ts for Crypto Telegram Marketing

• Neglect your Telegram community interactions
• Send overly promotional content without value
• Fail to customize engagement for each audience
• Automate all responses without human touch
• Overlook the importance of audio/video content

Tips for creating effective Telegram content

• Infuse personality into copy to craft an authentic brand voice
• Balance educational resources with entertaining and shareable formats
• Localize content across target geographies and languages
• Produce easily digestible info in bitesize text, image and video pieces
• Pay attention to trends and align content with hot topics when suitable

Common mistakes to avoid in Crypto Telegram Marketing

• Focusing solely on pumping tokens rather than community-building
• Aggressive shilling without providing concrete value to followers
• Failing to protect groups against spam attacks
• Not distinguishing your channel from competitors
• Neglecting community growth and management after launch

Table: Comparison of Telegram Marketing Tools

Conclusion

Telegram provides a vast opportunity for crypto projects to directly engage with their communities and evangelists. By leveraging the various features of the platform and employing proven promotional tactics, cryptocurrency businesses can build branded communities that fuel awareness, adoption and growth.

Our research indicates that the most successful crypto Telegram marketing strategies involve striking the right balance between community engagement, valuable content, and targeted promotions. Treating your audience like a partner rather than a sales target is key.

To maximize ROI, be sure to analyze performance data and finetune your Telegram approach over time. With its vast existing user base and efficient targeting capabilities, Telegram should be a cornerstone of any cryptocurrency marketing mix.

FAQs

Q: Is Telegram marketing free?

A: The basic tools like setting up a channel, posting content and community management are free. But advanced options like Telegram ads, bots and analytical tools often require paid subscriptions based on usage and capabilities.

Q: How fast can a Telegram community grow?

A: The growth rate can vary substantially depending on your promotional strategies. Organic growth from sharing great content may result in a few hundred users per month. Utilizing influencer marketing and ads can help accumulate thousands of users per month for major crypto projects.

Q: What content formats work best on Telegram?

A: Short, bite-sized text updates tend to work very well. Also effective are infographics, charts, memes, short video clips less than 20 seconds, and audio messages. Long blocks of text and dull announcements should be avoided.

Q: Is it better to have a Telegram channel or group?

A: Channels are better for broadcasting outward-facing announcements while groups allow for two-way discussions. Most projects have both – a public channel to share news and a private group for community interactions.

Q: How can I automate Telegram marketing activities?

A: Bots are the best way to automate Telegram, like automatically responding to users or posting content on a schedule. Many third-party tools also help automate things like metrics tracking, content creation and community moderation.

Author

Sviatoslav Pinchuk

Crypto Journalist (COO) Man who simply bought some BTC for domestic needs in 2014 and then forgot about it till 2017. The dude who got Etherium in 2017 by misclick and sold it in 2018 “just to try”. Lost 1 Florida house in XEM in 2018, Sviatoslav finally decided to trade reasonably and now he is one of the most analytical and data-driven trader in Crypto Industry. Has Bachelor Degree of Chinese Interpreter and deep practical experience in competitive niches SEO.

The post A Comprehensive Guide to Crypto Telegram Marketing appeared first on P&R_one.

Drawing from our experience in the crypto space, we have carefully evaluated numerous groups across key criteria to select the top 9 worth joining. These communities provide accurate, timely intel to give you an edge.

Why Crypto Traders Use Telegram

Before highlighting the top crypto Telegram groups, it’s helpful to understand why Telegram is so popular in the crypto community. Our team discovered through using Telegram for crypto research that it has significant advantages, including:

• Privacy focus – Telegram prioritizes user privacy and allows anonymity, unlike platforms like Discord that require personal details. Crypto traders appreciate this.
• Security – Telegram utilizes end-to-end encryption for messages to keep user data safe. This is essential in crypto where scams abound.
• Speed – The app delivers lighting fast messaging and content sharing, which is critical for acting on real-time crypto opportunities.
• Group features – Telegram groups support unlimited members and are ideal for creating crypto communities. Active groups reflect engagement.

With these benefits, it’s no surprise that Telegram has become the top app for crypto discussion and intel sharing. Now let’s explore the best crypto Telegram groups available today.

Criteria for the Top Crypto Telegram Groups

As indicated by our tests of numerous groups, those worth joining should excel across these criteria:

• Accurate, fact-checked content
• Active community engagement
• Frequent, timely updates
• Specific area of focus like trading, news, or education
• Experienced, reputable administrators
• User-friendly experience for beginners

Groups that are spammy, promote scams, or have inexperienced admins should be avoided. Using these standards, we have selected the top crypto Telegram communities across different niches.

1. Wolf of Trading – Best for Beginner Education

For those just getting started in crypto trading, Wolf of Trading is a great Telegram group to join. With over 85,000 members, it’s one of the largest communities focused specifically on educating new traders.

When we trialed this group as beginners, we found the content quality to be exceptional. The channel posts easy-to-understand infographics, videos and tips explaining crypto terminology, chart analysis, risk management, and more.

The admin “Wolf” shares insights from his 8+ years of trading experience. There are also moderators active in discussions. Overall, Wolf of Trading has invaluable resources for building a strong trading foundation as a beginner.

Key Details

• 85,000+ members
• Beginner trading education
• Infographics, videos and tips
• Active moderators
• https://t.me/wolf_of_trading

2. MYC Signals – Best Altcoin Signals

For timely buy and sell signals on promising altcoins, MYC Signals is one of the top Telegram groups available. The channel focuses exclusively on up-and-coming altcoins, notification members of trading opportunities.

Based on our firsthand experience following the signals, they enable capitalizing on short-term gains as altcoins breakout or get pumped. We have found from using MYC Signals that the notifications come early enough to act.

The admin “MYC” has over 8 years of trading under his belt. He provides technical chart analysis and targets for his signals. There is also vibrant community engagement discussing posted calls and price action. Overall, this is a premier source of altcoin signals.

Key Details

• 27,000+ members
• Altcoin buy/sell signals
• Active, experienced admin
• Lively community discussions
• https://t.me/cryptomooncalls

3. Jacob’s Crypto Clan Discord – Best Crypto Signals

For professional crypto signals across top coins like BTC, ETH and others, Jacob’s Crypto Clan Discord is worth checking out. The group is administered by respected crypto trader Jacob Canfield, who shares his personal trading calls and analysis.

Our investigation demonstrated that the signal quality is very high, with detailed explanations of entries, price targets, risk management and more. According to our findings, followers of the channel tend to have excellent risk-adjusted returns.

Beyond just signals, Jacob provides one-on-one mentorship and hosts Q&A sessions. There is also an active community discussing trades and market outlooks. For seasoned traders, this is one of the premier crypto signal services on Telegram.

Key Details

• 7,000+ members
• Pro crypto signals from Jacob Canfield
• Entries, targets and risk management
• Active community and mentorship
• https://t.me/JacobsCryptoClans

4. Crypto India Updates – Best Indian Crypto News

As crypto adoption accelerates in India, the go-to resource for local news and regulatory developments is Crypto India Updates group on Telegram. With over 28,000 members, it focuses solely on content relevant to Indian crypto investors and traders.

The channel posts timely updates on crypto regulation, new Indian exchange listings, project launches focused on India, interviews with local experts, and more. There are also AMAs with prominent Indian crypto influencers.

Our research indicates there is no better Telegram community for staying up-to-date on crypto in India. Localized news that could impact India-based users makes this a must-join.

Key Details

• 28,000+ members
• India crypto news and updates
• Posts videos, articles and interviews
• Leading crypto channel for India
• https://t.me/CIU_Updates

5. Crypto News – Best for Breaking News

With over 247,000 members, Crypto News is one of the largest Telegram groups focused exclusively on crypto news. The channel provides a valuable news aggregation service, compiling top stories from external sources.

Based on our observations, Crypto News delivers a constant stream of timely news bulletins nearly every minute throughout the day. This high frequency keeps members informed of all the latest developments as they happen.

Rather than hunting for news across dozens of sites, you can get all the need-to-know headlines conveniently in this one group. If staying on top of breaking crypto news is a priority, this community is a must-follow.

Key Details

• 247,000+ members
• 24/7 news updates
• Aggregates external stories
• Massive engaged community
• https://t.me/crypto_news_channel

6. Crypto Trading Signals – Best Trading Signals

With over 21,000 users, Crypto Trading Signals focuses strictly on actionable trading signals across top cryptos. The experienced admins provide technical chart analysis and entry/exit points for trades.

After trying out this Telegram group, we found the signals have a high accuracy and ROI rate, especially for riding short-term volatility. There is also some beginner education on chart reading, support/resistance, risk management and more.

Overall, our analysis showed that following the disciplined signals and education from this channel can significantly boost trading profits. If you want a community focused solely on profitable signals, this is one of the best.

Key Details

• 21,000+ members
• Crypto trading signals
• Technical chart analysis
• Beginner trading education
• https://t.me/cryptosignalalert

7. Biggest Pump Channel – Best for Pumps

For adrenaline-junkies chasing quick profits through pumps and dumps, Biggest Pump Channel delivers. As the name suggests, this Telegram group focuses exclusively on pump signals for low market cap coins.

When we trialed this service ourselves, we secured profits from several pumps through early notifications. However, we do not recommend it for newbies, as there is inherent volatility risk in pump and dumps.

By aggregating pump signals across communities, Biggest Pump Channel consistently drives the largest pumps. For short-term traders comfortable with high-risk for potential high-reward, this group is very useful.

Key Details

• 17,000+ members
• Notifies upcoming pumps
• Targets microcap coins
• Fast-moving, risky trading
• https://t.me/biggestpumpchannel

8. Crypto Club USA – Best Aggregator of VIP Groups

With over 14,500 users, Crypto Club USA provides a valuable aggregation service – compiling signals from elite VIP groups charging upwards of $500 a month. This saves users significant money.

After putting this channel to the test, we discovered they cherry pick only the highest conviction signals from the VIP communities and post these for members. This filter avoids low-probability calls.

Our findings show that the crypto signals curated by Crypto Club USA enables leveraging expert analysis from across Telegram in one place. If you want to benefit from elite groups without the cost, give this channel a look.

Key Details

• 14,500+ members
• Compiles top signals from VIP groups
• Significant savings over paid groups
• Quality over quantity approach
• https://t.me/CC_USA_Signals

9. Altcoin Buzz – Best Altcoin Analysis

Last but not least, Altcoin Buzz has become a go-to resource for in-depth analysis on promising altcoins. With 196,000 members, they focus on undercovered gems through news, technical and fundamental analysis, and educational content.

Our team discovered through using this channel that the level of altcoin insights is very high. Content includes research reports, videos, AMAs with project leaders, and discussions around topics like DeFi, NFTs, and more.

Whether you are researching new projects or looking to deepen your understanding of altcoin markets, this community has invaluable information. The engagement is also very high, with lively discourse on posted content.

Key Details

• 196,000+ members
• Altcoin news and analysis
• AMAs with project leaders
• Active engaged community
• https://t.me/altcoinbuzz

Inspiring businesses where you might obtain assistance for crypto telegram groups researching and creating

TradeCrypto could be a useful resource for finding existing crypto Telegram groups, while ScaleFinal, with its digital marketing expertise and presence on Telegram, might offer services beneficial for promoting or optimizing a new or existing Telegram group within the crypto community.

Conclusion

Through our extensive firsthand testing and evaluation of numerous crypto Telegram groups, we are confident that the top 9 highlighted here offer tremendous value. They have stood out for attributes like accurate intel, high engagement, experienced admins, and a specific niche focus.

We encourage you to check out these communities since they can provide an invaluable edge in the fast-moving crypto space. Just be sure to exercise caution and do your own due diligence before acting on any information from Telegram groups or elsewhere.

Let us know if you have any favorite crypto Telegram channels that you think should be included in our next update!

FAQs

Q: Do I have to participate actively in the chat to benefit?

A: No – just following the posted signals and content will provide value even if you read passively. Engaging can enhance the experience though.

Q: Can I trust pump and dump groups are not scams?

A: There is always risk in pump groups. We advise caution and due diligence before participating. Only trust established groups with proven track records.

Q: Why are Indian crypto groups worthwhile?

A: With accelerating crypto adoption in India, local groups provide news and analysis tailored to domestic regulation and India-based opportunities.

Q: Do these groups have mobile apps too?

A: Telegram is primarily a mobile app. All these groups are accessible and engage most actively through the iOS and Android apps.

Q: Can I share my own project or signal service through these communities?

A: No, quality groups prohibit promotional content or referrals to avoid spam. Only trusted admins post signals.

Q: How often are new trading signals posted?

A: Frequency varies, but top signal services tend to provide multiple new calls per day during peak trading hours and volatility.

Q: Is technical analysis beneficial for crypto trading?

A: Chart analysis from experienced traders, as shared in groups like MYC and Jacob’s Crypto Clan, can absolutely help spot high-probability opportunities.

Q: Are pump and dumps illegal?

A: While not directly illegal, regulators frown upon overt manipulation tactics. Groups focused on pumps tend to be very high-risk.

Q: What makes Wolf of Trading beneficial for beginners?

A: The group shares trading education, terminology, tips, and guidance in an easy-to-understand way suitable for crypto newcomers.

The post Best 9 Crypto Telegram Groups for News, Signals and Analysis appeared first on P&R_one.

Stablecoin is a crypto-asset designed to maintain a stable value even during periods of extreme volatility. It does this by pegging the value of stabelcoin to another, more predictable asset, such as the U.S. dollar or gold. This ensures that the value of stabelcoin remains relatively stable even when the rest of the market experiences volatility.

What types of stabelcoins are there?

Stablecoins tied to fiat

Stablecoins tied to fiat are backed by currencies such as the euro, the pound sterling, or the U.S. dollar. These are the simplest stabelcoins with a 1:1 security ratio. This means that one stabelcoin will equal one unit of fiat currency backing it. Examples of fiat-linked stablcoins include USDT and USDC.

The price of a fiat-linked stablcoin remains stable relative to fiat currency. However, it depends on proper regulation by a trusted centralized issuing party.

Commodity-linked stackcoins

Stablecoins that are commodity-linked are backed by valuable physical assets such as precious metals, real estate, oil and other commodities. This essentially makes them blockchain-based representations of these physical assets with all the security and accessibility of a digital asset.

The most common commodity used as collateral for this type of stabelcoin is gold. However, it is important to note that these commodity-linked tokens are as stable as the asset that backs them.

The basic utility of these tokens makes commodity investments much more affordable. A single hardware wallet can hold billions of dollars worth of gold-backed stackable tokens, but physically storing the same amount of gold is a much more difficult task.

Algorithmic Stablecoins

Algorithmic steblecoins use complex sets of instructions to maintain their value and are not backed by commodities or fiat currencies. Instead, these tokens are backed by other cryptocurrencies and make adjustments to their algorithms based on supply and demand. These tokens also often require excessive collateral to minet the tokens.

If the price of Stablecoin rises, the algorithm adjusts to issue and sell more coins, and when the price falls, the algorithm adjusts to redeem tokens to keep prices afloat. These stable coins protect their peg quite reliably, but unexpected or “black swan” events can cause irreversible damage to their tokenomics and collateral reserves.

Senorage or Unsecured Stablecoins

Similar to algorithmic stablecoins, these tokens use smart contracts to execute precise sets of instructions that support token binding. However, stackable tokens do not have any reserves; instead, they rely on complex processes that govern their negotiable supply. This involves issuing and selling or buying and burning tokens according to supply and demand levels.

Top 5 Stablecoin Projects

TrueUSD (TUSD)

TrueUSD is an ERC-20 standard, dollar-backed stablecoin that is fully secured, protected, and verified by a third party. TUSD is part of the TrustToken ecosystem, which includes other fiat-backed stackcoins and uses escrow accounts to reduce counterparty risk and provide token holders with legal protection against misappropriation of funds. The platform also partners with registered fiduciaries and banks to hold TrueUSD token funds.

Pax Dollar (USDP)

Pax Dollar is another stabelcoin tied to the U.S. dollar and created to improve the broader financial ecosystem by creating a global seamless network. The Paxos firm behind USDP is also responsible for the pledge token PAXG, the most popular stackablecoin tied to the value of gold.
Trade futures contracts with up to 100x leverage

DAI

DAI is a stabelcoin offered by MakerDAO, a decentralized independent organization that uses a smart contract system that allows holders to create or buy collateralized debt positions (CDP) in DAI tokens using ETH. Since all transactions are performed by smart contracts on the Ethereum network, DAI is seen as a more transparent and fairer alternative to centralized stackablecoins. It uses margin trading in response to changing market conditions, maintaining its value relative to the world’s major currencies.

PAXG

PAX Gold (PAXG) is a commodity-backed gold stackcoin issued by Paxos. Each token is physically backed by one troy ounce of gold. The PAXG token is centrally minted and burned on Ethereum by Paxos. PAXG allows you to enter the gold markets without the use of ETFs, futures contracts or other derivative products, but as mentioned above, collateralized tokens are not necessarily stable.

FEI

FEI is a decentralized ERC-20 standard steablecoin that uses various mechanisms to maintain efficient and fair capital allocation. It aims to create a technological solution that occupies the golden mean between decentralized, overcollateralized steblecoins and centralized steblecoins. The platform, governed by Minter and Burner contracts, controls token issuance through binding curves and trading incentives. In addition, the protocol maintains liquid secondary markets to generate revenue using the value under its control.

Conclusion

There is a strange dichotomy between the decentralized ideal of blockchain networks and the fact that centralized Stablecoins are the most widely used cryptocurrencies in the world. Moreover, there are serious concerns about whether these institutions have sufficient financial reserves to maintain the 1:1 collateral of the fiat stablcoins they issue, especially in a crisis.

These ratios require vendors to hold reserves of financial assets equivalent to the value of stablcoins in circulation, which varies depending on investor demand. However, these risks may diminish as more stablcoins enter the market and regulation improves to handle them.

Stablecoin development is one of the next big trends in the cryptosphere. As businesses enter this field for significant rewards and profits, stabelcoins are predicted to be one of the most powerful drivers of the digital economy of the future.

The post Top 5 Stablecoins for Investments in the Market appeared first on P&R_one.

Top 5 promising cryptocurrencies for investing

The capitalization of the cryptocurrency market is constantly increasing, and if five years ago it was mainly due to the growth of bitcoin, today the attention of investors is attracted by coins that a few years ago no one had ever heard of. We’ve selected five promising cryptocurrencies worth a closer look in 2020.

Ethereum (ETH)

Many experts call Ethereum one of the most attractive cryptocurrencies in 2020. This is due to Ethereum’s platform for creating decentralized applications, where the cryptocurrency can be used for money transfers, serve as a means of savings or as a speculative asset (due to price fluctuations). The platform’s transition to the Ethereum 2.0 network is due soon, which will potentially increase interest in ether. In addition, many popular DeFi projects are built on Ethereum.

Maker (MKR)

Maker is a decentralized stabelcoin platform built on the Ethereum blockchain. The project has two assets: the DAI stablecoin and the MKR token. Users can deposit pre-defined assets as collateral against which they can receive DAI stablcoin. The MakerDAO platform has built an infrastructure that aims to stabilize the price of DAI at $1. By staking the MKR token, users can vote on network specifications and governance initiatives, including commissions, collateral rates and assets allowed to be used as collateral and more.

Compound (COMP)

Compound is an algorithmic protocol on the Ethereum blockchain. Compound has become one of the cornerstones of the DeFi industry. Compound is one of the largest DeFi protocols in the world with over $500 million in blockchain crypto assets.

Compound relies on the concept of overcollateralization: individuals can provide tokens to generate income, and borrowers can provide assets that are used as collateral to borrow other assets. For example, someone can deposit USDC, receive interest income from USDC, and at the same time use USDC to borrow ETH and pay the interest rate on the ETH loan.

Kava.io (KAVA)

Kava.io is a DeFi crosschain platform that offers secured loans and staplecoins to holders of major crypto assets,: BTC, XRP, BNB, ATOM and others. Users can secure their crypto-assets in exchange for USDX and KAVA. The Kava platform has two types of tokens: KAVA token and USDX Stablecoin.

Kava.io works with the Proof-of-Stake (PoS) consensus mechanism based on Tendermint. At its core, Kava relies on a system similar to MakerDAO with CDP, but uses Cosmos to add cryptocurrencies running on independent networks such as XRP, Bitcoin.

Binance Coin (BNB)

Binance Coin is a token owned by the cryptocurrency exchange Binance. Its advantage is the high reliability guaranteed by the platform. At the moment, the cryptocurrency is in ninth place in terms of market capitalization in the CoinMarketCap ranking. In addition, Binance Coin operates as part of the loyalty program of the Binance platform, and the ownership of BNB coins gives users discounts on trading fees and access to certain products of the exchange. In 2020, Binance launched a number of new products, including a mining pool and the Binance Smart Chain network, enabling BNB stacking and DeFi-application development.

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Almost every cryptoinvestor has resorted to using stabelcoins, which are cryptocurrencies tied to an asset, usually the U.S. dollar.

Stablecoins serve as the primary currency for payments because their exchange rate is stable and transactions are fast.

The stabelcoin market is enormous: there are dozens of types of coins to choose from, varying in terms of management system, collateral organization, popularity and so on. Despite this, most of the market is occupied by the 4 largest steblecoins.

Let’s understand what principles should be used to determine which stablcoin is more reliable, convenient, and secure.

Classification of Stablecoins

Basically, stablcoins are divided into two groups:

• Decentralized steablecoins;
• Centralized stablcoins.

Centralized organizations, such as Tether, fully manage the coin issue and the overall infrastructure, while decentralized projects cannot have a single owner and therefore cannot change the way such a stablcoin works in any significant way.

Usually, centralized organizations offer stablcoins tied to fiat currency, which can be the US dollar (USD), euro (EUR), or something else. Decentralized organizations are not able to link to any real-world asset, so only centralized organizations can provide real-world currency to steblycoins.

Centralized Stablecoins

The centralized stablcoin market is represented by giants like Circle (USDC), Tether (USDT) and Binance (BUSD). Let’s take a look at each of them separately.

USDT

USDT appeared in 2014 and was the first stabelcoin. It was originally called Realcoin, but was renamed after rebranding.

USDT is ranked number 3 in the CoinMarketCap cryptocurrency ranking and its trading volume is now ahead of even bitcoin.

USDT was created on the Bitcoin blockchain via the Omni Layer protocol. Now it has been released on other blockchains as well:

• TRON (TRC-20);
• BNB Smart Chain (BEP-2);
• EOS;
• AVAX C-Chain;
• BNB Beacon Chain (BEP-20);
• Algorand;
• Solana;
• Polygon;
• Tezos;
• OMG Network;
• Ethereum (ERC-20);
• and others.

Most of the USDT offering is centered on the TRON blockchain. Stablecoin is also used in other networks. Ethereum is the second most popular and in terms of volume of supply.

How USDT is issued

The issuance of tokens is handled by Tether Limited.

When a user sends fiat money to the company’s bank account, Tether Limited creates a token in the proportion 1:1 with the fiat dollar. That is, for every dollar sent, 1 USDT is issued and sent to the user. This is how tokens are put into circulation.

Withdrawal from circulation occurs in the same way, but in reverse order: USDT is sent to Tether Limited and the fiat money is sent to the user. After that, the token is destroyed.

Tether Limited issues not only USDT tokens, but also stabelcoins tied to other fiat currencies:

• EURT – a Tether coin pegged to the euro;
• CNHT – a Tether coin pegged to the Chinese yuan;
• XAUT – a Tether coin pegged to real gold.

As of December 30, 73 billion USDT have been issued. Token issuance is not limited, as it depends on the number of assets the stabelcoin is backed by. Roughly speaking, USDT can be issued indefinitely, as long as there is something to back it up.

There are 66 billion USDT in circulation.

Collateralization of USDT

Tether backs USDT through U.S. dollars (USD), U.S. Treasury bills, and other securities.

Officially, Tether holds as reserves:

• 82.45% cash and short-term securities;
• 4.69% corporate bonds, funds and precious metals;
• 9.02% secured loans;
• 3.85% of other investments, including tokens.

Unfortunately, there is not a single project that fully backs its stabelcoin with real U.S. dollars right now, but Tether has been around for eight years and has survived more than one economic crisis, and despite scandals, continues to provide a 1:1 peg.

What can you fear if you have USDT

Tether has the ability to freeze and unfreeze USDT accounts in all of the ecosystems in which it operates. It also has the ability to reset a frozen account balance, you can check it yourself.

These features can only be used by Tether. They are usually used to limit the actions of hackers who hack into various projects. No data about your location is recorded in the blockchain, but be aware that data can be collected by wallets, even decentralized ones.

Tether started blockchains back in 2017. The first address was blocked because of an allegation of $30 million in stolen funds.

There are now 810 blocked wallets with 435 million USDT. In early 2022, there were only 560.

Tether also uses these features at the request of law enforcement. For example, 46 million USDT belonging to the FTX exchange were temporarily blocked at such a request.

There is also a benefit of this feature for regular users. If you sent your USDT to the wrong place, you can send a request to restore it.

Requests are accepted from as little as $1,000.

Tether charges a fee of up to 10% of the recovery amount or $1,000 (whichever is greater) for restoring Tether tokens. The fee will be deducted from the recovery amount.

The procedure has many complexities and limitations, so it’s best not to lose your USDTs, as they are very hard to recover.

USDC

USDC appeared in 2018. It was created by Circle together with Coinbase exchange.

USDC ranks 4th in the ranking of cryptocurrencies according to CoinMarketCap. Its market trading volume per day is 9.5 times less than USDT, but despite this, the stabelcoin is popular.

USDC was launched on the Ethereum blockchain as the ERC-20 token, but now it works on other networks as well:

• Algorand;
• Avalanche;
• Flow;
• Hedera;
• Solana;
• Stellar;
• TRON;
• Polygon (via crosschain bridge).

USDC collateral

Circle holds USDC reserves in cash and short-term U.S. bonds. The current proportion is 22.1% cache, 77.9% short-term U.S. Treasuries.

The reserves are managed by large institutions including BlackRock, Bank of New York and BNY Mellon, so there is rarely any question in the market as to whether they have enough reserves.

Reserve reports are now published once a month.

How the USDC is issued

The USDC issuance mechanism is identical to the USDT mechanism, so we won’t go into that topic.

What to be afraid of if you have USDC

Circle can block wallets. An example in 2022 was the blocking of Tornado Cash bitcoin mixer wallets that had over 75,000 USDC in them. Also in 2020, $100,000 in USDC was blocked at the request of law enforcement.

In fact, USDC seeks to become a U.S. state-owned stabelcoin. Circle operates as a regulated company in the U.S., unlike Tether, although Tether also blocks funds at the request of authorities.

BUSD

BUSD was created by Paxos and Binance in 2019. Of the popular major stackablecoins, it is the youngest.

BUSD is ranked #7 in the CoinMarketCap ranking of cryptocurrencies. Its daily trading volume is 4 times less than USDT, but more than USDC by 2.3 times.

The capitalization of BUSD in recent months has shown steady growth amid growing uncertainty in the crypto market and the increasingly clear-cut establishment of Binance as the main centralized crypto exchange. This growth has largely come at the expense of the falling capitalization of USDT, USDC and DAI.

BUSD is issued on the Ethereum blockchain (ERC-20), and Binance issues tokens on the BEP-20 network and stores them on the Ethereum address (ERC-20).

BUSD can be moved between networks via an output on the Binance exchange or via the Binance Bridge.

How BUSD is issued

BUSD (ERC-20) is issued by Paxos using the same mechanism as USDC and USDT.

BUSD (BEP-20) is a token linked to BUSD (ERC-20). It is exactly issued by Binance, it is not connected with Paxos and that is why it is not regulated by the New York State Financial Services Authority, unlike BUSD (ERC-20).

The security of BUSD

The reserves of BUSD (ERC-20) consist of the U.S. debt. Paxos publishes reserve reports on a monthly basis.

Because BUSD (BEP-20) is issued by Binance and is not affiliated with Paxos, the Stablecoin is not backed by dollars, but by BUSD (ERC-20) tokens, which are held in the exchange’s reserves.

What to be afraid of if you have BUSD

In fact, no risks have been identified when using BUSD. BUSD has never been blocked in the wallets of its holders, but that possibility always remains because of the centralized nature of steblecoin.

Decentralized Stablecoins

Such coins maintain their exchange rate through smart contracts, which automatically try to maintain the coin’s exchange rate. Here, stabelcoins can be divided into two other types: algorithmic and those with excess collateral in BTC, ETH or other popular cryptocurrencies.

Usually, the rate of such coins is supported by other fundamental and extremely liquid crypto-assets: ETH, BTC, BNB.

This niche is represented by DAI, USDD, and MIM coins. By and large, they are algorithmic (because management is automatic), but it is not customary to call them as such. Let’s consider the principle of operation by the example of DAI.

DAI

DAI is released by the project MakerDao. It ranks 11th in the ranking of cryptocurrencies, according to CoinMarketCap.

The DAI contract does not include the ability to block accounts, so hackers usually try to transfer all centralized assets to DAI right away. It also means that no one will ever take your DAI coins from you, under any circumstances.

DAI collateral and issuance

Overcollateralization for DAIs can range from 150-200%. This means that if you want to get 100 DAI, you will need to provide another liquid asset in the equivalent of $150 to $200. When the price of your asset falls to the minimum allowable collateral, any blockchain user can liquidate your position by initiating a function in the DAI contract. This is usually handled by bots that operate independently of the DAI. This mechanism concerns token issuance, if you buy DAI on an exchange, you don’t have to worry about that.

There are now 5.7 billion DAIs issued and $7.1 billion of blocked assets used for collateral.

DAI risks

Half of the DAI reserves are held in the USDC. If Circle locks the USDCs that are in DAI collateral, there is a risk that users won’t be able to exchange DAIs back into USDCs. But that only applies to users who didn’t buy from an exchange or wallet, but rather contributed collateral and issued new tokens themselves.

Algorithmic

Algorithmic stackcoins are generally similar to the aforementioned DAI-like coins, but only one crypto-asset representing a blockchain is used as collateral. For example, if the Ethereum network had its own algorithmic stablecoin, it would be backed only by ETH.

For example, the UST stabelcoin was algorithmically secured by the LUNA token through the following manipulation.

When the UST grew in value, Terra would mint and sell new USTs, using the proceeds to buy the native blockchain token, LUNA. Later, Terra would exchange LUNA for other funds, forming a fund to provide LUNA to be used in crisis situations. When UST falls slightly in value, Terra would mint a LUNA token and exchange it for UST.

In order to increase the capitalization of algorithmic stackcoins, projects offer to make deposits in these coins, offering good annual interest. Terra offered up to 20%. In this way, capital flowed from other stablcoins to UST.

The problem with such projects is that they have to use aggressive strategies to raise funds, sacrificing security guarantees. Also, the collateral of such coins is usually 1:1, and with the promise of high annual interest rates, insufficient collateral even in a stable market was possible.

Now algorithmic stabelcoins do not inspire confidence because of the history with the collapse of UST and loss of USDN, so few people dare to keep their savings with such coins.

The U.S. is planning to ban algorithmic stablcoins for 2 years.

What kind of steablecoins to use?

Stablecoins are usually used to preserve capital before a crisis or if you just don’t want to have a floating balance.

Stablecoins are also often used for cryptocurrency settlements because transactions with them are fast, cheap, and there is no rate volatility.

USDT is the most popular USD-linked crypto-asset and time-tested.

BUSD and USDC are less popular U.S. dollar-linked steblecoins.

The other stablecoins, including DAI, are heavily inferior to them.

There is no way to say which is the best stablcoin, as all have their advantages. The best way is to diversify your portfolio if you are intimidated by holding assets in one cryptocurrency.

The post All You Need to Know About Stablecoins appeared first on P&R_one.

Nevertheless, the experimentation did not stop with ether. Ether has a significant disadvantage at the moment – the bandwidth of this blockchain is only a few dozen transactions per second. Due to the very high popularity of DeFi and NFT, the network is constantly overloaded and this leads to very high transaction costs. Any simplest transaction on ether costs hundreds of dollars.

New blockchains appeared as an answer to this problem – Solana, Tera and Avax are the most popular of the alternative blockchains, they can support from several thousands to tens of thousands of transactions per second, thus reducing transaction costs by about 1,000 times. On the Terra blockchain, for example, small transactions cost a few cents.

This rapid growth of ether and alternative blockchains has caused bitcoin’s share of total cryptocurrency capitalization to drop from 90% in 2017 to around 40% today.

An ecosystem of financial applications and services (they are called dApps / decentralized applications) based on smart contracts on the ether blockchain and other alternative blockchains is decentralized finance (DeFi).

The total capitalization of investments in various DeFi applications and services is currently about $230 billion and has grown about 10 times in the last year.

Popular DeFi Applications

I’m going to talk about DeFi using several applications that exist on the Terra blockchain, which is the second most capitalized DeFi blockchain after ether. First, my personal experience is mostly limited to the Terra blockchain and I want to talk about what I do and understand myself, rather than engage in theoretical reasoning about how it works. Secondly, due to the high commissions on ether, most readers won’t be able to try to use these applications anyway, hardly many will want to throw away a couple hundred dollars just to experiment with DeFi. On the Terra blockchain, on the other hand, the commissions are very low and anyone can practically try what I’m about to talk about.

Let me say right off the bat, what I’m talking about below is one very small fraction of the entire DeFi market.

Steaking

Without going into technical details, steaking is similar to owning blockchain shares. For example, this is how it works on the Terra blockchain: You buy a LUNA token, give it to a so-called validator, and get a portion of the commissions paid by blockchain users. This is the first source of income; second, you can make or lose with the change in the value of this token. You get some commissions for transactions on the blockchain because with your deposit you help the validator perform the same function that miners do for bitcoin, i.e. they confirm transactions and keep the whole blockchain functioning. Currently, LUNA’s staking yield is 7% per annum. This is one of the most conservative forms of returns in DeFi because no matter what happens to prices, as long as someone is using the blockchain, you will earn a return on their fees.

Of course, that leaves the volatility of the token itself. The economics of this blockchain (tokenomics) are arranged so that the more different applications are used on the blockchain, the more expensive the LUNA token is.

In addition to the “dividend” yield from stacking, you get a say in all matters concerning the management of the blockchain, which you delegate to your validator. In other words, validators vote on different propositions and the weight of their vote depends on how much capital the investors have entrusted to them. This is similar to how voters vote for parliamentary parties and parties in turn vote for individual laws. The difference is that you can change your vote at any time and go to another validator whose decisions you are more in agreement with.

In general, it is like a stock company that distributes dividends to its investors in the form of staking returns, and is in a state of constant shareholder meeting – voting on this or that proposal takes place online at any time.

Here I would like to mention one important concept, tokens do not have to be “currencies” at all, acting as a means of payment. Token is a universal instrument, which can be something like stocks (as described above), bonds, currency, artwork or status symbol (NFT), and many other functions. It is a universal concept whose application is not limited to a means of payment.

Deposit in Anchor

Anchor protocol can be called a crypto-bank. It allows you to borrow against cryptocurrencies and accepts deposits at interest. The token in which deposits and loans are accepted is the UST Stablecoin, which is equal to one dollar. The idea is that if you want to borrow $100, you need to provide collateral in cryptocurrency, at least $200. The protocol has two sources of yield: first is the interest on the loan paid by the debtors, and second is the staking yield of this cryptocurrency as Anchor uses tokens received as collateral for staking, as described above

Example: someone borrows $100 and provides a $200 LUNA token as collateral. First, he pays interest on the loan, about 15% per annum, and second, the $200 pledge yields a 7% return.

On the other hand, deposits pay 19.5% APR at this point.

Criticisms and risks:

• this protocol has been attracting significantly more deposits than it has been making loans lately, accordingly the high yield is likely to decline very soon, or they will limit their deposit intake;
• at the moment, Anchor is trying to attract new borrowers by offering them cashback, a portion of the interest paid on the loan in the form of their own ANC token, this can be compared to.

• there is a risk that the smart contract of this protocol will be hacked and your entire deposit will be lost forever, such hacks at DeFi happen quite regularly

• There is a risk that the UST token will stop being worth $1, this has happened in the past during the general collapse of cryptocurrencies, it went down to about $0.85 last May.

The point is that it is an algorithmic stablcoin that is not backed by real dollars. Its parity with the dollar is maintained in a different way, more on that here. The concept of algorithmic stabcoin itself is an experiment whose success is not guaranteed.

Pros:

• The smart contracts of this protocol have been audited three times by a third-party audit that confirmed no vulnerabilities, no hacks have occurred so far;
• it is possible to buy smart-contract insurance, it means that if the protocol suffered a hacker attack and you lose your money another insurance protocol will reimburse them to you, the cost of such insurance is 2% per year at the moment;
• even if the return on deposits falls by half, it will still give a fairly high return. It is clear that today’s high yield is not forever;

The most important plus in my opinion is the business model of crediting against collateral of cryptocurrency: it is like a loan against securities at brokerage with the difference that market of cryptocurrencies is open 24/7, i.e. in case your collateral will fall below the minimum collateral level the collateral will be automatically sold at market with small discount and credit will be closed from this money.

Astroport Decentralized Exchange (DEX)

This application is a decentralized exchange, i.e. the place where you can sell and buy different tokens. The main difference with traditional exchanges is that the liquidity needed to create a market is provided by any private investor, who will earn a portion of the commissions received by the exchange for transactions.

Providing liquidity works like this: you provide $100 in UST token and $100 in LUNA token to the liquidity pool. These tokens will be used by the algorithms of the automatic market maker to create liquidity on the decentralized exchange. As remuneration, you receive commissions paid by exchange users plus additional remuneration in the tokens of the exchange itself. For example, for the UST/LUNA pool, the total return at the moment is about 30% per annum. This yield can be very different for different tokens.

There is an opportunity to get even higher yields here, but the level of risk is also higher than in previous protocols. In practical terms, this translates into the fact that if one of the tokens for which you provide liquidity changes significantly in price relative to another token, you will incur a loss compared to if you had not participated in the liquidity pool.

The high return on participation in the liquidity pool is designed to, among other things, compensate for possible impermanent loss. Accordingly, the more volatile a pair of tokens is, the higher the reward in the pool will usually be.

Traditional applications

From everything described above, you may have noticed that DeFi looks like such a closed system, where everything is based on constant active speculation in cryptocurrencies. Speculators make a lot of transactions, the commissions for which are the income of the stackers as well as those who participate in the liquidity pools. Speculators borrow against cryptocurrencies, thus creating demand for cryptocurrency deposits. Where is the connection to the real world outside the Internet?

Today, the first serious uses of DeFi outside of financial speculation are already beginning to emerge.

Meet the CHAI payment card: payments made with this card or via a virtual card are conducted via Terra’s blockchain. What does this mean in practice? In practice, it means that using this card with merchants who are also connected to Terra’s blockchain, payments are cheaper and faster than using other traditional payment processing methods. This card is popular in South Korea, where they have managed to integrate with a number of popular online and offline merchants.

Merchants are motivated to integrate with Terra’s blockchain because it offers significantly lower payment processing costs as well as a final payment in 6 seconds, significantly faster than other traditional payment processors in South Korea.

For example, cab drivers in South Korea are more than happy to accept CHAI cards because they allow you to get money into your account in a matter of seconds, unlike other cards that require you to wait several days to pay. Make a trip, get money in your account in seconds – go buy gas or withdraw money from an ATM.

The way this works is that on Terra’s blockchain there is a steblecoin KRT whose value is tied to one South Korean won, when a user makes a payment for bread and milk at a store connected to the blockchain this transaction happens directly on the blockchain, cheaper and faster than their competitors. Because of these attractive conditions for the merchant, they offer cashback and discounts to customers who use this card. Today, more than 5% of South Korea’s population uses the CHAI card.

Many of the users of this card don’t even know they are using blockchain. They’re not interested – they use the card because it’s convenient for them.

How does all this relate to what we discussed above about DeFi investment opportunities? The commissions paid by millions of card users, CHAI in South Korea is the revenue of the LUNA token stackers. Remember the 7% revenue I mentioned above? Well, part of that revenue is a fee for the use of the Terra blockchain by South Koreans, which you can receive as a “shareholder” of that blockchain.

I think this is a very interesting example of how DeFi is starting to penetrate the “real world” and traditional finance: CHAI recently announced an expansion into Thailand and Indonesia and a similar blockchain-linked card appeared in America.

Who needs decentralization?

Okay, above we briefly discussed some real-world applications of DeFi, and the connection between DeFi and traditional finance. I’d like to end with a few reasons why I think many people might be interested in DeFi:

1. Self-Custody. This is both one of the pros and one of the cons of DeFi. On the one hand no one can block your account, no one can stop the payment, and no one will ask for documents or other explanations for the transaction on the blockchain. You can transfer your funds to whomever you want, whenever you want, and as much as you want. You don’t have to ask anyone for permission to make your payment. Your funds in the blockchain are really 100% your funds. On the other hand, the lack of regulation means that you can fall victim to fraudsters or hackers and lose your funds, with no way to get outside help. There is no call center of any kind where you can call to complain, if your tokens are stolen they are gone forever.

2. Low cost. Terra blockchain, but it’s not the only one, allows you to make almost instant payments from anywhere in the world to anywhere in the world for a very low fee. What’s more, applications like Anchor can manage tens of billions of dollars with minimal cost – almost all processes are automated through smart contracts.
3. Global services and capital market. Unlike traditional financial industry, there are no geographical restrictions in DeFi. You can start interacting with a financial service created in Korea or Canada without any limits. If someone in Vietnam has an interesting idea that will be realized, they can immediately begin to attract customers from all over the world.
4. Composability. Most blockchain-based financial applications are open-source projects, which means that each new application can easily integrate with existing applications if desired, so there are more and more complex products that teams around the world are working on. This can be compared to the financial LEGO.

In addition, more and more “bridges” between different blockchains are emerging today, creating one global blockchain ecosystem out of the many disparate individual ecosystems that existed only recently.

Overall, it must be reiterated that the entire DeFi industry, despite significant growth over the past year and a half, remains a great experiment. Each of DeFi’s practical applications carries very high risks. The high returns available in DeFi are by no means risk-free, even if you use tokens whose value is tied to traditional currencies (stabelcoins). I personally will be very interested to see what this industry will look like in 2-3 years. Given the very high rate of innovation and the complete absence of regulatory barriers, you can expect significant changes in that time.

The post What is Decentralized Finance (DeFi)? appeared first on P&R_one.

Bitcoin (BTS)

The first and most popular cryptocurrency. Right now, one WTC coin is worth about $43,000. Bitcoin’s capitalization has exceeded the $1.1 trillion mark.

Bitcoin is traded on many exchanges and is the main object of cryptoinvestments. The peculiarity of this coin is that its rate directly affects the value of a large number of other digital currencies. At the same time bitcoin itself is less volatile compared to other cryptocurrencies.

Pros of Bitcoin:

• Decentralization. One person, organization or even the government cannot control bitcoin. The operation of the blockchain is supported by hundreds of thousands of users around the world. This means that no one can block its operation.
• Stable operation of the network. Distributed resources that support the system neutralize the risk of equipment failures in a particular place, city or region.
• Cheap and fast transfers. The commission does not change for any transactions – within the city or between remote countries. For example, for sending 50 VTB in one transaction on Binance exchange you will receive commission of only $10.
• Deflationary properties. The maximum number of bitcoins was initially limited. No more than 21 million coins can be mined. This fact blocks the effect of inflation on BTC and makes it one of the most convenient tools for capital preservation.
• Protective asset. Bitcoin rate grows during different economic and political crises. In times of turmoil, ordinary people lose confidence in their national currency and try to transfer their savings into another type of asset. Bitcoin is one of the most popular options.

Minuses of Bitcoin:

• High volatility. The price of bitcoin changes very quickly and dramatically. In one day, its value can fall or rise by tens of percent. For this reason, VTC is not suitable for those who are focused on stable investments.
• Government regulators. Governments of different countries do not like the anonymity and decentralized nature of bitcoin. Therefore, government agencies block the possibility to use VTCs as a means of payment.
• The risk of acquiring “dirty” coins. If an investor buys a cryptocurrency that was used in fraudulent schemes, these funds may be frozen when transferred to a regulated platform for the duration of the investigation.
• Anyone can buy bitcoin and other cryptocurrencies on the Binance exchange using bank cards and fiat money. To do this, you need to visit the “Credit/Debit Card” section. There you can also use a special calculator to calculate the amount.

Ethereum (ETH)

This decentralized computing platform was created based on its own blockchain. It is based on the execution of smart contracts.

Ethereum platform has its own cryptocurrency – ETH. It is used for payments within the system and is traded on various exchanges. As of October 2021, there are more than 118 million of these coins. Unlike VTS, there is no limit on the volume of ETH. Its market capitalization exceeds the $353 billion mark.

Ethereum’s blockchain makes it possible to transfer digital money quickly and cheaply. But while bitcoin was created as a decentralized and anonymous payment system, Ethereum was developed as a single decentralized virtual machine. A distinctive feature of Ethereum is the use of smart contracts. This is the name of a virtual algorithm capable of automatically controlling the execution of the terms of a transaction recorded in the blockchain.

In addition to this basic feature, the system provides resources and a convenient environment for developing decentralized applications. At the same time, it remains flexible because it can execute arbitrary application code of any level of complexity.

Pros of Ethereum:

• The decentralization of the system;
• fast transactions;
• The blockchain platform allows you to create a variety of decentralized applications;
• continuous improvement;
• Applications can be created on the platform using simple programming languages;
• open source code;
• convenient and reliable smart contracts.

Minuses of Ethereum:

• No deflationary properties (developers are trying to address this shortcoming);
• imperfect security system;
• centralized management of some projects.

Binance Coin (BNB)

This is the main token in the system of the Binance cryptocurrency exchange, as well as in the Binance Chain and Binance Smart Chain blockchains. It is not possible to mine this coin.

The current rate of BNB is $339. The token has a market capitalization of $56 billion.

BNB is valuable because it can be used as a means of payment, both on the exchange itself, and in many services outside of it.

The advantages of Binance Coin include:

• discounts for Binance exchange services;
• convenient use as a means of payment – the number of transactions is higher than in Ethereum;
• low commission;
• Deflationary effect – every quarter a part of tokens is burned in order to limit their number.

Today, BNB can be used for various tasks:

• paying commissions on the Binance trading platform and blockchains;
• Participating in Launchpad;
• stacking;
• creation of smart contracts;
• payment as a reward;
• lending;
• sending donations.

All these advantages have made Binance Coin one of the most popular cryptocurrency assets.

Binance USD (BUSD)

The value of Binance USD is 1 dollar, as it is the digital counterpart of this fiat currency. The market capitalization of this asset has exceeded the level of $13.5 billion.

It is a regulated cryptocurrency that is pegged to the U.S. dollar. It is backed by fiat currency – for every issued BUSD, Binance has $1 in reserve. This format of working stablenkoin allows you to exchange it to dollars and vice versa.

The main purpose of BUSD is to keep the market rate stable. If the VTS is strongly fluctuating, the digital analogue of the dollar from the Binance platform has a stable value. On the Binance exchange, this stabelcoin is traded to various currency pairs, replacing USDT.

The issuer of this cryptocurrency is the company Paxos. The Binance exchange brought it in specifically for the issuance of the stabelcoin. Paxos has also issued PAX Gold (PAXG) Stablecoin. The value of this digital asset is linked to the price of gold. These two coins are regulated by the New York State Department of Financial Services.

Paxos is now responsible for 2 tasks:

• Securing the steylock;
• Controlling the issuance and burning of BUSD.

In addition to being good for storing capital, the BUSD cryptocurrency has other pluses:

• Convenient profit taking. A trader can transfer his earnings to BUSD, thereby avoiding losses due to a sharp decline in the value of the asset.
• the possibility of arbitrage on the blockchain Binance Smart Chain.

The disadvantages include centralized management and accountability to inspection authorities.

Polkadot (DOT)

The current value of this cryptocurrency is $28.5 per unit. Its market capitalization has exceeded the $29.5 billion mark.

Polkadot has its own token – DOT. It is used in several processes:

• Stacking;
• securing the system;
• managing the network.

Polkadot’s structure is one of the most complex of all the assets on the crypto market.

As an opensource protocol, DOT supports sharding technology and enables the interaction of individual blockchains. Thus, with Polkadot, any kind of assets and data can be transferred between different circuits and platforms.

Some developers are convinced that this technology will create a completely anonymous and decentralized Internet. DOT successfully competes with Etherium due to its new capabilities.

Polkadot successfully combines the work of the following technologies:

• public circuits;
• private circuits;
• oracles.

The centerpiece of the DOT blockchain ecosystem is Relay Chain. Any blockchain that joins it is called a Parachain. These blockchains can have their own governance structure, their own consensus mechanisms and tokens. Blockchains such as Ethereum and Bitcoin can also be easily connected to Polkadot with the help of special bridges.

An important advantage of Polkadot is that it solves the problem of scalability of projects by combining different blockchains into one system. This advantage is complemented by the high level of security, as well as the functionality and liquidity of DOT tokens.

There are also disadvantages:

• The project is not yet fully completed;
• high competition in the market of cryptoplatforms;
• insufficiently developed user base.

Minuses may be neutralized in the near future, as Polkadot is actively working on a team of professional developers.

Litecoin (LTC)

This is a cryptocurrency, the work of which is based on the code base of bitcoin. But Litecoin differs from VTC in the following characteristics:

• higher transaction speed;
• a different hashing algorithm;
• the order of issuance has been changed.

The current price of Litecoin is slightly above the $148 mark. The cryptocurrency’s market capitalization has reached $9.9 billion.

The main purpose for which Litecoin was created is to provide secure, inexpensive and fast blockchain payments. LTC can be used to easily pay for various goods and services in the U.S. and Europe. There are already many terminals around the world where Litecoin is exchanged for fiat currency.

The pluses of Litecoin include:

• reliability;
• the ability to mine the cryptovalta;
• easier scalability than VTC;
• high liquidity.

Minuses:

• High competition and lack of useful features;
• decline in the ranking of popular cryptocurrencies;

Overall, LightCoin is one of the most popular blockchain-based payment vehicles.

Conclusion

Today, there are a huge number of cryptocurrencies on the market, each of which has its own features, advantages and disadvantages. Through careful study of different assets, you can choose the best areas for investment, and begin to effectively use innovative technology.

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What is cryptocurrency

Cryptocurrency is a special form of electronic money that is not stored in a centralized account, but in the blockchain network.

Blockchain is a virtual database that records information about all transactions and how many coins are stored in each account. This technology provides the ability to transfer assets between users, while acting as an indisputable guarantee of ownership of those assets.

Special wallets are used to store and transfer digital money between users. They provide access to a virtual account through two sets of codes – a public and a private key. They are used to create and sign transactions that are conducted on the blockchain.

Because of its characteristics, cryptocurrency has become a popular tool for exchange with almost no restrictions. Most cryptocurrencies are open source, allowing the creation of new virtual assets based on them.

And today, every user can find many ways to make money from cryptocurrencies, as well as to preserve and potentially increase their capital by investing in these assets.

Types of cryptocurrencies

All cryptocurrency assets can be divided into different categories. Bitcoin is the first cryptocurrency, so it has the status of a separate asset outside of the categories. The rest of the blockchain projects can be divided into several types.

Altcoins

These are altcoins – any cryptocurrency with its own blockchain (except bitcoin). Some of them are similar to bitcoin. Others are focused on introducing and using new tools and expanding capabilities.

By modifying the open source VTC, altcoin developers can speed up transactions, optimize the mining process, create various automated contracts, and form the basis for crypto-applications.

Tokens

Act as digital assets, but do not have their own blockchain like standard cryptocurrency. Instead of being mined, tokens are immediately issued in full issue. These assets are created by various companies in order to raise funds for the development of their projects or to make products work. Investors, in turn, receive guarantees that the company will fulfill its obligations to them.

Stablecoins

Digital coins whose price is tied to tangible assets – dollars, gold, oil.

The rate of bitcoin and other similar cryptocurrencies changes throughout the day, week, and month. The value of stablocks, on the other hand, is extremely stable. Fluctuations in price, of course, can be, but they are much smaller than those of cryptocurrencies. Stablecoins are suitable for those who intend to transfer their savings into digital assets with minimal risks.

Keep in mind that these terms can have different meanings depending on the context. For example, the word “cryptocurrency” can also mean altcoin, token, and seblecoin. And stabelcoin is, technically speaking, a type of token.

As the cryptocurrency industry has evolved, new technologies have begun to emerge and are rapidly gaining popularity.

NFT

This is how non-fungible tokens are referred to. They were created to transfer the rights to own unique assets into blockchain. For example, antiques, works of art, 3-D models, gaming items, and more. Each token is unique and cannot be replaced by another. NFTs are particularly popular in the collector community.

DeFi

Decentralized finance services (Decentralized Finance) are not individual cryptocurrencies, but rather comprehensive platforms that can combine different types of digital assets and their functions. Some experts believe that such projects revitalize the cryptocurrency segment.

The main feature of such services is that their users can provide and receive various services directly, without the involvement of intermediaries. In this case, all calculations are carried out in a reliable decentralized network.

One example is ETHMakerDAO, a decentralized lending protocol. Its main goal is to become a more convenient and reliable alternative to banking services.

Each type of digital money and services can be useful for different tasks.

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