Altcoins

Here’s What’s Next for XRP, Binance Coin, Cosmos and One Low-Cap Altcoin, According to Popular Analyst

Popular crypto strategist Michaël van de Poppe is outlining what he thinks is in store for four altcoins including XRP, Binance Coin (BNB) and Cosmos (ATOM) after a weekend that witnessed a bounce across the crypto markets. Van de Poppe tells his 613,700 Twitter followers that he believes XRP appears poised for a brief pullback […]

The post Here’s What’s Next for XRP, Binance Coin, Cosmos and One Low-Cap Altcoin, According to Popular Analyst appeared first on The Daily Hodl.

Crypto News

ViaBTC Capital | Reasons Behind Solana’s Frequent Downtime: Design Flaws in the Gas Economy

What is the gas fee? In the blockchain world, the gas fee is a fee that users have to pay to the blockchain network for each transaction. For example, when a user makes a transfer on Ethereum, miners must package his transaction and put it on the blockchain to complete the transaction. This process consumes the computing resources of the blockchain, and the fee paid to miners is called the gas fee. Gas economy Imagine that each public chain is a society or a city, and gas would be the currency that users need for various activities in the city, and the economic designs of gas have far-reaching impacts on the public chain’s future development. Today, we will illustrate the significance of the gas economy from the perspectives of performance and value capture. Performance – The frequent network congestion of Solana In early May, Solana’s mainnet lost consensus, and block generation was suspended for 7 hours. The mainnet was down due to the NFT minting of a new NFT project. Users turned to bots for sending transactions as much as possible to increase their success rate of minting. This led to 6 million transactions per second on the Solana mainnet, which jammed the network. Moreover, as Solana transmits consensus messages as a special transaction message between validators, the heavily congested network also disabled the normal transmission of consensus messages, eventually leading to the loss of consensus. This is not the first downtime of Solana. Last September, the public chain suffered a 17-hour downtime due to the massive trading volume created by on-chain bots during the launch of the hit project Raydium. A 30-hour Solana downtime incident happened at the end of January 2022 when the BTC price plunged from $44,000 to $33,000 during a market crash and created plenty of arbitrage opportunities. Meanwhile, the liquidation/arbitrage bots on Solana, which center on DeFi, kept creating massive transactions, which resulted in network downtime. When comparing Solana to a conventional IT system, we can tell that the downtime resembles a DDoS attack. 「A DDoS (distributed denial-of-service) attack refers to adding traffic from multiple sources to exceed the processing capacity of a network so that real users would not be able to acquire the resources or services they need. Attackers often launch a DDoS attack by sending more traffic to a network than it can handle or sending more requests to an application than it can manage.」 Instinctively, many people would think that Solana’s downtime is rooted in its public chain designs: the monolithic design of Solana inevitably leads to downtime. At the moment, mainstream public chains use two kinds of designs: the modular and the monolithic. The modular architecture refers to a modularized deployment where consensus, storage, and execution are implemented separately so that the collapse of the execution layer will not compromise the security of the consensus layer. At the same time, mainstream designs adopted by Avalanche’s Subnet, ETH 2.0, and Celestia’s Rollup can all diverge massive transactions. On the other hand, although Solana as a whole is designed to enable fast transactions, scalability and security were sacrificed. However, the modular design of a public chain is not the key because although the consensus stayed secure, the individual rollup could still suffer from downtime when facing overwhelming transactions in a very short period. In other words, the modular design just lowered the systemic risks (e.g., a certain rollup could halt but the rest can survive) for the public chain. The gas design is the real reason behind Solana’s downtime, and more network downtime is on the way if the design is not improved. – The gas mechanisms of different chains The figure below shows the gas designs of three mainstream public chains. On Solana, the gas fee is based on the number of signatures. The more signatures a transaction uses, the higher the gas fee. However, the maximum memory capacity of each transaction is fixed, and so is the maximum gas fee per transaction, which helps users easily calculate the cost of sending massive transaction requests. Moreover, transactions on Solana are not sequenced, which means that when the cost of sending massive requests is lower than the profit (arbitrage, NFT minting, etc.), users would use bots to send transactions on a large scale to increase the likelihood of the execution of their transactions. This is also the reason behind the downtime events that took place on Solana. Ethereum and Avalanche share similar gas designs. Both feature the base fee and the priority fee, which creates an inherent sequencing issue because transactions with a higher priority fee would be first executed. As such, although users can still use bots to create massive transactions on Ethereum and Avalanche, their transactions will not be executed no matter how many requests are sent when the priority fee becomes insufficient, and they have to wait in line. Considering the cost of gas, such a design eliminates the possibility of network downtime arising from massive transactions at the economic level. Source[1] – Improvement by Solana Economic isolation has always served its purpose better than methodological isolation. Solana has already started to build its own Fee Market by introducing a concept similar to the priority fee. Meanwhile, Metaplex, Solana’s NFT market, will also adopt a new concept called Invalid Transaction Penalty, which means that users will have to pay a fee for invalid transactions when minting NFTs. Value capture Value capture is the reflection of a gas economy via the market cap of the gas (the native crypto of the chain). The market cap of a native coin is roughly determined by two factors: cash flow and monetary premium. – Cash flow When it comes to charging the gas fee, most public chains follow the same approach: lower the gas fee as much as possible to attract users from Ethereum. From the perspective of cash flow, such an approach is unsustainable. Of the three mainstream public chains, only Ethereum stands with a considerable net cash inflow, although the network is still issuing more Ethers. If we consider additional issuance as a type of subsidy, then the net expenditure of Ethereum per day would be about $25.7 million if the annual issuance rate stands at 3.21%. Solana and Avalanche, on the other hand, have an income of $6,250 and $42,000 a day on average, with a daily net expenditure of $4.6 million and $1.86 million and a yearly issuance rate of 6.93% and 5.22%. The high net expenditure & high issuance rate significantly dilute the market cap of the public chain coins. Source[2] Let’s turn to the destinations of cash flows. Under Ethereum’s current mechanism, the base fee is burned, while the priority fee is offered to miners. Compared with the gas burning and distribution mechanisms of Solana and Avalanche that offer the gas fee to validators, the miner reward is a design that compromises value capture. Ethereum uses the PoW design for block generation, and most of the miners adopt a business model under which tokens that have been mined are sold to cover the mining cost (such as electricity fees and maintenance costs). Therefore, the part of the gas fee paid to miners will most likely go out from the ecosystem. It would be better to give the gas fee to validators because the cost of running a node is not as high as operating a mining factory. Since there are not significant ongoing operating cost, validators are more likely to invest the rewards they’ve received in the nodes, which makes the ecosystem safer without diluting the value of the native coin. Burning fees might be the most direct and effective way to capture valuee and benefits both node stakers and token holders. In addition, MEV constitutes another major source of revenue for public chains. According to statistics from Flashbots, from 2020 to now, $600 million worth of MEV has been paid to miners, which is a conservative estimate. Source[3] – Monetary premium Monetary premium refers to the appreciation of a public chain coin in terms of its practical value and value storage. Most existing public chain coins are carrying out massive issuance, which makes them poor value storage, and the practical value forms the backbone of their market cap. The growth of the ecosystem of a public chain coin will create scenarios where it can be used as a payment method. For instance, most NFT transactions are settled with public chain coins. Meanwhile, most emerging public chains also consider the practical value as the primary means of appreciation, which is why they have set negligible gas fees to attract traffic and new users. Meanwhile, some public chains have built foundations worth hundreds of millions of dollars to encourage more developers to build DApps in their ecosystem. The logic behind such an approach is to make big investments to attract users in the initial stage and try to recover the cost later. Conclusion To sum up, the gas design of a public chain will have profound impacts on the future development of a public chain, and a poor design could lead to poor value capture and even performance bottlenecks. When evaluating a public chain project, we can also get a rough picture of its development strategy and future growth through its gas designs.   [1] https://docs.solana.com/implemented-proposals/transaction-fees#congestion-driven-fees,https://ethereum.org/en/developers/docs/gas/,https://docs.avax.network/quickstart/transaction-fees/ [2] https://cryptofees.info/,https://moneyprinter.info/,https://solanabeach.io/ [3] https://docs.solana.com/implemented-proposals/transaction-fees#congestion-driven-fees,https://ethereum.org/en/developers/docs/gas/,https://docs.avax.network/quickstart/transaction-fees/

Crypto News

Eminem And Snoop Dogg Team Up, The Video Features Bored Ape Yacht Club Imagery

Is the Bored Ape Yacht Club responsible for this collaboration? Hip hop legends and worldwide icons Snoop Dogg and Eminem join forces once again for the single “From The D 2 The LBC.” The video is basically a BAYC ad and the duo premiered the song at Apefest, the Bored Ape Yacht Club multi-day party that was part of the NFT.NYC conference. This is a huge win for the BAYC, at a time when the NFT collection lost 60% of its value in a flash. The last time we saw this duo collaborate was on the track “Bitch Please II,” from Eminem’s 2000 outing The Marshall Mathers LP. Besides Snoop Dogg, that track features their mentor Dr. Dre, Xzibit, and the late Nate Dogg. After that, the legend says that Eminem’s camp denied a request for collaboration from Snoop and the pair never worked together again. Until now. Did the Bored Ape Yacht Club accomplish that? Eminem And Snoop’s Bored Ape Yacht Club Story It’s worth noting that both Eminem and Snoop Dogg come from Dr. Dre’s lineage, so a collaboration between both artists makes all the sense in the world. They are also both part of the Bored Ape Yacht Club. Approximately six months ago, Eminem paid $425K for a BAYC specimen inspired in him. At the time, NewsBTC reported: “The NFT, named “EminApe,” depicts Eminem’s iconic Bored Ape figure wearing a khaki army cap and a gold chain necklace, both of which he frequently wears in real life. BAYC member GeeGazza sold the digital artwork for 123.45 ETH, which is around $450,000 USD. In November 2021, GeeGazza tweeted, “I still think Eminem is destined to buy my @BoredApeYC one day.” Took too long to reconnect with @snoopdogg– you know we had to make a movie! https://t.co/087W2OZJOI #FromTheDToTheLBC #curtaincall2 @BoredApeYC pic.twitter.com/k443JqXHON — Marshall Mathers (@Eminem) June 24, 2022 For his part, at approximately the same time, Snoop Dogg got a full set and announced “When I APE in I APE all the way in!!.” A full set, for those not in the know, consists of a Bored Ape, an M1 and an M2 Mutant, and a Bored Ape Kennel Club with similar characteristics. In Snoop’s case, those were a military helmet, leopard skin, and a pink and fluffy garment. At the time, NewsBTC reported on the story behind the purchase: “It all came from a deleted tweet. What did it say? We wouldn’t know. However, NFT strategist Just1n.eth brought another rapper into the conversation. “He needs to link up with Waka Flocka to talk about the NFT collection that he should be looking into!” And Waka Flocka went straight to the BAYC. “Uncle Snoop you need a Ape mane!!! Join the yacht club.” Eminem. Snoop. From the D 2 the LBC. Out now. https://t.co/fcZqaniRxQ pic.twitter.com/bmTpKNXtjq — Snoop Dogg (@SnoopDogg) June 24, 2022 The Video, The Song, The Premiere The psychedelic video mixes video of Em and Snoop in the studio with Bored Ape Yacht Club-inspired animation. It was directed by James Larese. They premiered it at Apefest, an all out party that featured performances by hip hop legends like Lil Wayne, Bun B, The Roots, Future, and of course Eminem and Snoop Dogg.  The videos abound. Check this one out: WORLD PREMIERE: Snoop & Eminem show their new song featuring at ApeFest @BoredApeYC @SnoopDogg pic.twitter.com/8lLVY9mRng — cr0ss.eth @ NFT NYC (@cr0ssETH) June 24, 2022 And this one: What the actual fuck? @SnoopDogg @Eminem @BoredApeYC #apefest pic.twitter.com/1KDZ5rxHGc — Leonardo Viti (@leovitiart) June 24, 2022 The Bored Ape Yacht Club team will also sell merchandise related to the single, but no one knows what it actually looks like. “Snoop x Eminem merch drop pushed. We’ll tweet here with timing updates,” they announced through Twitter.  APE price chart on Coinbase | Source: APE/USD on TradingView.com This is not Snoop Dogg’s first musical collaboration with the Bored Ape Yacht Club. The rapper appeared in Colombian producer and singer Esther Anaya’s single “BAYC,” a dance music track that sounds like this: Last but not least, NewsBTC has to point out that Eminem and Snoop appeared on stage together earlier in the year at Dr. Dre’s presentation at the Super Bowl Halftime Show. So, maybe the Bored Ape Yacht Club is responsible for this single, but the two artists probably had already squashed their beef. Featured Image: Screenshot from the video | Charts by TradingView