Anonymous analyst “Wezek Bruh” posted the main reasons why BadgerDAO and its native token pegged to Bitcoin, DIGG, could be a great opportunity for investors. Created as a rebase token, DIGG has the capacity to contract or expand its supply to meet a price target, as Wezek Bruh explained.
The analyst believes there is value in DIGG as a potential speculative investment and a “critical part of the Badger ecosystem”. DIGG holders have a fixed percentage of the token’s total supply market cap. Although its price is determined by market dynamics, the numbers of DIGGs an investor has, within a wallet or smart contract, can increase or decrease depending.
This is determined by the positive or negative rebase, but as the analyst explained, this mechanism is designed for the investor to “always keep your share of the pie”. Wezek Bruh added:
The main takeaway is that you should think about your DIGG position in terms of percentage ownership of the total market cap rather than the number of tokens multiplied by the price per token.
DIGG holders can stake their tokens inside a Badger vault and receive rewards with the token bDIGG. Currently, there is a 43% APY with this product. Unlike DIGG, bDIGG is not subject to the rebase mechanism. The analyst said the following about BadgerDAO and one of its investment Bitcoin-based strategies:
(…) you can buy DIGG which imperfectly tracks the price of BTC, stake it in Badger to earn 43% APY, and also get bDIGG tokens back in your wallet that you can use in other places within DeFi.
The analyst highlights that BadgerDAO offers its users incentives that allow both holders and the protocol to benefit. Therefore, the latter can build a sustainable model.
How DIGG Can Be A Hedge Against Bitcoin’s Swings
As Wezek Bruh further explained, DIGG’s is rebased on a 10-day period. The mechanism responds to BTC’s price oscillation. Therefore, DIGG takes longer to react to a crash or bull-run. This window can be leverage in more investment strategies.
Since the token tracks BTC’s price performance, DIGG can be considered a synthetic version of Bitcoin. An “impure” one, as the analyst claimed. However, BadgerDAO has the objective of integrating BTC with the DeFi sector. Wezek Bruh added:
Badger is entirely focused on bringing BTC to DeFi. And with DIGG, it is one of the few places that offer yield in BTC. In the end, I prefer BTC over “fill in the blank” latest token of the week.
In contrast with other synthetic versions of BTC operating on the DeFi sector, such as Wrapped Bitcoin (WBTC), DIGG removes a risk factor by not requiring users to provide collateral. The analyst believes this protocol can reach the “Holy Grail of crypto” by combining BTC’s feature as a store of value with the “long-term” utility found in DeFi and Ethereum’s ecosystem. Wezek Bruh said:
The mechanics around DIGG may be different, but the utility remains as DIGG owners are provided BTC in-direct exposure on Ethereum to earn interest (bDIGG, ibBTC), lend against their positions, and (most importantly) as a composable asset in DeFi to do much more!
Bitcoin trades at $57.043 with a 7.6% rally in the daily chart. In the weekly and monthly chart, BTC has a 9.7% profit and a 2.8% loss, respectively.
Crypto Scam Watchdog Group Wants To Get Back At Vitalik Buterin
A crypto scam watchdog group wants to get back at Ethereum’s creator after he got rid of all of his SHIB token holdings. Now, the group created a token that dumps ETH for rival BNB as we can see more in our latest Ethereum news today.
The market for SHIB collapsed after Buterin got rid of all of his tokens and now one crypto scam watchdog group wants revenge. The Telegram group War on Rugs hates rug pulls but now they are trying to rug pull Ethereum. The group says it’s composed of developers and auditors that created the Rug Ethereum token in retaliation for the ETH co-founder Vitalik Buterin’s decisions o transfer millions of his SHIB tokens to charity while at the same time he crashed the market for the token:
“Vitalik rug pulled Shiba, innocent investors have been hurt. He should never be shown as a hero for this.”
@VitalikButerin rug pulled Shiba Inu $SHIB. Let’s rug Ethereum $ETH. Introducing Rug Ethereum $RETH on the Binance Smart Chain. A token that dumps ETH for BNB. The first @WARONRUGS token. #SellYourETHhttps://t.co/lZ7zckBqIG
— #WARONRUGS❌ (@WARONRUGS) May 14, 2021
Binance CEO Changpeng Zhao agreed to list the token on Binance’s Innovation Zone and called SHIB high risk. War on Rugs which looked at the smart contract said that this year Buterin had a huge stake in the token which meant it could be vulnerable. A rug pull is a type of scam where developers leave a project and take investors’ money with them. They are most common in the DeFi space where people can go to get crypto loans, earn interest, and trade assets without getting the help of a financial intermediary or insurance that intermediaries provide.
Buterin didn’t develop the token so now the creators of the meme token sent trillions of the asset to Buterin who is reversed among ETH acolytes for his intellectual capacity and lack of concern for the things money can buy. Sending the funds to Buterin’s wallet lent the project a veneer of legitimacy while also decreasing the supply because he wouldn’t touch the funds. DeFi researcher Chris Blec said:
“If you consider a ‘rug pull’ to be quickly, without notice, removing a damaging amount of liquidity from a pool, then I guess that’s what Vitalik did. The fact that he never asked for the liquidity in the first place definitely changes things though.The SHIB token project was originally deployed with a specific set of risks and a whole lot of inherent problems. Vitalik didn’t change any of that. He simply exposed the token for what it was.”
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Bitcoinist Book Club: “The Bitcoin Standard” (Prologue and Chapter 1)
To lay the foundation for everything we’ll learn in the Bitcoinist Book Club, we had to start with “The Bitcoin Standard” by Saifedean Ammous. A fair amount of experts in the field recommend it as the first Bitcoin book people should read. Does that mean it’s too basic for the Bitcoinist audience? Not at all. Our readers might already be familiar with these concepts, but seeing them used as building blocks to construct a case for Bitcoin is a thing of beauty.
Here’s an introductory deep dive into The Bitcoin Standard and the first iteration of the Bitcoin Book Club.
About The Coolest Club On Earth
The Bitcoinist Book Club has two different use cases:
1.- For the superstar-executive-investor on the run, we’ll summarize the must-read books for cryptocurrency enthusiasts. One by one. Chapter by chapter. We read them so you don’t have to, and give you just the meaty bits.
2.- For the meditative bookworm who’s here for the research, we’ll provide liner notes to accompany your reading. After our book club finishes with the book, you can always come back to refresh the concepts and find crucial quotes.
That’s it. Let’s get into it.
“The Bitcoin Standard” – Prologue
The book is divided into three parts. The first one discusses the concept of money and everything it implies. The second part goes back in time and analyzes the use of “sound and unsound forms of money throughout history.” The third, finally, gets into Bitcoin and the possibilities it brings to the table, “and analyzes the possible uses of Bitcoin as a form of sound money.”
The prologue also provides a solid definition of what Bitcoin is:
In essence, Bitcoin offered a payment network with its own native currency, and used a sophisticated method for members to verify all transactions without having to trust in any single member of the network. The currency was issued at a predetermined rate to reward the members who spent their processing power on verifying the transactions, thus providing a reward for their work.
That means Bitcoin is, “the first demonstrably reliable operational example of digital cash and digital hard money.” This is huge. This is what the world needs. And, as we go through this book, we’ll find out exactly why.
The prologue cannot end without a familiar disclaimer: “This book does not offer investment advice.” Of course it doesn’t, and everybody involved resents the implication.
BTC price chart on Bitstamp | Source: BTC/USD on TradingView.com
“The Bitcoin Standard” – Chapter 1: Money
The main function of money is as a medium of exchange. The second is as a store of value, and the third is as a unit of account. We need money because barter is not an efficient enough system for a complex society. So, “A good that assumes the role of a widely accepted medium of exchange is called money.” It doesn’t matter what it is and it doesn’t have to be “government paper.”
What the market looks for in potential money is salability. That is, “the ease with which a good can be sold on the market whenever its holder desires, with the least loss in its price.” If that characteristic persists across time, then the asset displays an “ability to hold value into the future.” So, it becomes a store of value.
It therefore follows that for something to assume a monetary role, it has to be costly to produce, otherwise the temptation to make money on the cheap will destroy the wealth of the savers, and destroy the incentive anyone has to save in this medium.
If it’s difficult to produce new “monetary units,” that’s “hard money.” If it isn’t, then it’s “easy money.” Over time, people who use hard money will tremendously outperform people who use easy money. A constant increase in the supply will erode the purchasing power of the easy money, it’s as simple as that. The law of supply and demand never fails.
The ratio between the stock and flow is a reliable indicator of a good’s hardness as money, and how well it is suited to playing a monetary role.
With flow being the “extra production that will be made in the next time period.” These core concepts are the basis for PlanB’s Stock-To-Flow model. And this is the main reason that model works, “The higher the ratio of the stock to the flow, the more likely a good is to maintain its value over time.” Or to, you know… augment its value.
It’s time to talk about liquidity, “the more people accept a monetary medium, the more liquid it is.” And acceptance throughout a community is the characteristic that allows for pricing to be, “expressed in its terms, which allows it to play the third function of money: unit of account.”
So, money plays “the roles of medium of exchange to allow specialization; store of value to create future-orientation and incentivize individuals to direct resources to investment instead of consumption; and unit of account to allow economic calculation of profits and losses.”
So simple, and yet it eludes even the smartest of us.
Related Reading | A new year – new opportunities in crypto
A Critique, Because It Can’t All Be Positive
This sentence should’ve been heavily edited, it sounds like a bad joke:
Producers can specialize in producing capital goods that will only produce final consumer goods after longer intervals, which allows for more productive and superior products.
Five product-related words in a row? Come on! And, as a bonus, in the same paragraph:
The production of these tools stretches the duration of the production process significantly while also increasing its productivity.
Three more product-related words? That’s a total of eight in the same paragraph. Too much.
Stay tuned for the next installment of the Bitcoinist Book Club.
Coinsmart. Beste Bitcoin-Börse in Europa
Twitter CEO Jack Dorsey says he would forever work to make bitcoin better.
Twitter CEO Jack Dorsey expressed his support for the leading cryptocurrency bitcoin on his microblogging platform Twitter, in response to a tweet by the Square chief financial officer, Amrita Ahuja. “Our bitcoin strategy hasn’t changed. We’re deeply committed to this community, including working towards a greener future through our Bitcoin Clean Energy Initiative,” Ms Ahuja wrote on Twitter. These comments came a few days after Elon Musk’s Tesla suspended bitcoin payments.
#bitcoin changes *everything*…for the better.
And we will forever work to make bitcoin better. https://t.co/wssrF2U0P0
— jack (@jack) May 14, 2021
Square’s Bitcoin asset is valued at $410m.
Square is a digital payments company founded by Twitter chief executive and Jim Kelvey and launched in 2020. The company valued at over $100 billion in 2020 is evaluating Bitcoin as an investment opportunity. Square has purchased a total of $220 million Bitcoin to date. Its Bitcoin asset is valued at $410m. Bitcoin was trading at $48,523.20 on Saturday and is down 13 percent over the past five days since Tesla announced to drop the cryptocurrency as a payment method. “Square is doing exactly this for bitcoin with @SqCrypto,” Jack Dorsey had tweeted last year.
Tesla suspends the bitcoin payment option citing environmental reasons.
Less than two months after Elon Musk had announced to accept the leading cryptocurrency bitcoin payments for Tesla vehicles, the company discontinued its support. Elon Musk announced that the reason they are suspending bitcoin payments is because of environmental concerns. Bitcoin mining uses specialized computers that use massive energy for the process of mining. However, Tesla would continue to retain bitcoin holdings that it acquired sometime in January this year. The leading electric car maker had purchased $1.5 billion worth of bitcoins earlier this year, sending the price of the leading cryptocurrency to new highs.
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