Blockchain

Solving The “Rug Pull” Liquidity Problem On Uniswap DEX After The SUSHI Debacle

The cryptocurrency industry is gradually changing the traditional financial system allowing users to send transactions and make monetary payments across the globe seamlessly – bypassing geographical and governmental limitations. This has seen the crypto ecosystem evolve to create totally decentralized solutions in finance – decentralized finance (DeFi) apps – which provide a full financial system

Published

6 months ago

September 7, 2020

Republished by Plato

However, these DeFi projects, especially if small, have found it difficult to get their tokens listed on centralized exchanges such as Binance and Coinbase. Moreover, to list these uprising projects, some of these centralized exchanges ask for exorbitant fees – unpractical for these small projects.

Understanding DEXes – Uniswap

This gave rise to decentralized exchanges, such as Uniswap, which provides a free listing of ERC-20 tokens. DEXes also differ from centralized exchanges in that users provide liquidity on the exchange in a method called pooling. Here, liquidity providers deposit cryptocurrencies in the liquidity pool and earn a share of the fees paid out in trading.

Uniswap DEX uses the Automated Market Maker to settle the trades between peers and the liquidity pool. The whole DeFi ecosystem is heavily dependent on liquidity hence a lack of it could raise problems for smooth trading on the platform.

Without liquidity, holders of the cryptocurrency will lack an incentive to keep the token as they will not be able to sell it on the market. On Uniswap, tokens prefer to create pools with 50% ETH and 50% of their selected token to ensure liquidity is maintained.

Problems with Liquidity

Over the course of 2020, a number of crypto projects have come up with the rising DeFi wave but as was the case in 2017, crypto scams have also increased. On DeFi, liquidity remains the key manipulator of the protocol and too much centralization of this liquidity (or too little liquidity) can be bad for the protocols.

SUSHI scam exit

Recently, the cryptocurrency world has been awash with stories of one of the nastiest ‘exit scam’ in decentralized finance (DeFi) recently, raising doubts on the whole ecosystem. SushiSwap (SUSHI), a competitor to top decentralized exchange – Uniswap, dropped over 80% in a week as the creator of the project sold all his profits for a $16 million payout in Ethereum.

This type of scam, known as a rug pull, sees the hacker set up liquidity in the pool only to pull it out after some time leaving unsuspecting holders with severe losses.

As such issues become prevalent across the DeFi system, projects such as Unicrypt, LID Protocol, and Vesta Protocol aim at solving these liquidity problems on Uniswap and similar DEXes in the future.

A solution to liquidity?

As explained before, a rug pull scam mainly arises some minutes, days, or a couple of weeks following the liquidity injection from the hacker. Such a huge sell-off of tokens leads to cascading collapse of projects, whereby the small action of withdrawing liquidity for a profit leads to an eventual collapse of the system.

So how do you solve this SUSHI-related problem? Liquidity protocols that govern pool liquidity are one of the fast-rising solutions to the rug pull scams and Uniswap related liquidity problems. One of the robustly-built projects, LID Protocol, or the Liquidity Dividends Protocol, offers a “Proof of Liquidity” token that solves these types of problems.

Proof of Liquidity

Proof of Liquidity makes it impossible for scammers to take out their liquidity as they are vested for a period of time to enhance development and innovation on the platform. This is ensured by locking the liquidity of tokens that are pre-launched on their platform. This means that project owners cannot pull the liquidity from their project in a way that cons investors out of their money, or tokens.

Staking proceeds

The platform also prevents liquidity problems on Uniswap DEX by providing staking related incentives on the governance of the launched protocol. Here, liquidity providers are incentivized to stake and vote on decisions on the protocol. Projects such as LID Protocol and TrustSwap provide incentives such as token payments and tax incentives to users who participate in protocol growth.

This incentivizes token holders to partake in actions that are beneficial to the community at large.

Parting Shot

The recent SUSHI exit scam debacle is opening up conversations on how to effectively solve and prevent rug pull scams on Uniswap, Justswap, and other DEXes. The growth of liquidity solution providers will help grow the decentralized finance system, providing users with a highly trusted and safe platform to carry out “frictionless financial transactions”.

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Author: Stan Peterson

Being an active participant in the Blockchain world, I always look forward to engage with opportunities where I could share my love towards digital transformation.

Source: https://coingape.com/solving-the-rug-pull-liquidity-problem-on-uniswap-dex-after-the-sushi-debacle/

Blockchain

GBA Healthcare Working Group Releases White Paper as First Asset inBlockchain Ethical Design Framework for Healthcare

Published

1 hour ago

March 8, 2021

Republished by Plato

WASHINGTON, DC –March 2021

Beginning early 2020, theGovernment Blockchain Association (GBA) Healthcare Working Group (HWG)began undertaking the development of an ethical design framework for blockchain solutions in the healthcare industry as a service to the public. The GBA HWG is releasing the first asset in the Blockchain Ethical Design (BED) Framework for Healthcare in the form of a White Paper.

“We are excited to offer this guidance to healthcare policymakers, decision-makers and innovators in implementing blockchain featured technology in the healthcare space. The BED Framework for Healthcareis being developed collaboratively by members in the HWG including caregivers, entrepreneurs, healthcare technologists and legal professionals from around the world. We cover a comprehensive spectrum of use cases, regulatory and legal scenarios, and procedural insights based on real world experience in healthcare technology innovation. This White Paper is only the first asset in a suite of guiding tools the GBA HWG will be releasing through 2021, and we are looking forward to the feedback of our audience.” –Marquis Allen, GBA Healthcare Working Group Chair

The purpose of this publication is to:

Identify potential ethical issues of blockchain used in health service delivery
Discuss potential ethical issues for stakeholders across the healthcare ecosystem including regulatory and compliance segments

Propose a conceptual framework of blockchain ethics as it applies specifically to its design, implementation and use in healthcare.
Create an outlinefrom which the Blockchain Ethical Design (BED) Framework for Healthcare and its assets, tools, documents and content will be developed by the GBA HWG.
Raise awareness and stimulate further debate on the ethics of blockchain in the healthcare IT,health system governance and regulatory communities.

The GBA invites you to contact them for more information.

Learn more about the GBA: gbaglobal.org

For more information about the GBA Healthcare Working Group: gbaglobal.org/HWG

To download the whitepaper: gbaglobal.org/download

Contact: Kathy Dache @ Kathy.Dache@gbaglobal.org

________________________________________________________________________

Blockchain

Big Data Protocol Staking Surges Over $6 Billion in Latest DeFi Frenzy

Published

1 hour ago

March 8, 2021

Republished by Plato

Boasting three and four-digit annual percentage yields, Big Data Protocol (BDP) has become the latest DeFi frenzy as total liquidity on the protocol has skyrocketed to $6.1 billion just two days after liquidity mining incentives were launched.

The protocol announced its fair launch on March 6 where 100% of the initial circulating supply, which is 30% of the total of its BDP token, will be distributed to the community over six days. It is backed by a team of technologists, crypto investors, and data scientists and designed to incentivize liquidity mining over the long term.

There are liquidity pools for twelve different DeFi assets and they have attracted a lot of collateral in just two days.

1/ANNOUNCEMENT: fair launch of $BDP and $bALPHA is coming!

100% of initial circulating supply of $BDP is distributed to the community over 6 days, starting Sat 11 am ET/4 pm GMT

Earn by staking 12 assets $WETH $WBTC $USDT $USDC $OCEAN $LINK $SUSHI $UNI $YFI $AAVE $SRM $TOMOE pic.twitter.com/GatOjGtUZJ

— Big Data Protocol (@bigdataprotocol) March 3, 2021

Big Returns for DeFi Stakers

Over a million ETH has been deposited in the wrapped Ethereum pool according to the BDP data vault, earning an APY of 40%. Almost 17,000 BTC is currently in the wBTC pool earning 82% APY while the Tether vault has gained 728 million USDT earning 96%.

The top earning pools are boasting four digit returns with OCEAN at 1,375% and TOMOE at 1,315% at the time of writing.

A blog post explaining the tokenomics elaborated:

“Users provide liquidity to earn bALPHA over the course of 3 months. Subsequent data tokens, named bBETA and bGAMMA, will launch after bALPHA, which will further incentivize liquidity.”

A portion of BDP and data tokens are burnt as the usage of the Protocol and marketplace grows over time, it added.

The total supply of 80 million tokens will be divided as follows: 30% distributed in the initial six day yield farming incentive, 35% allocated to future staking rewards, 25% held as an ecosystem reserve, and 10% to the team and advisors.

The bALPHA data token will have a total supply of just 18,000 tokens which will all be allocated to liquidity mining rewards. Two more data token sets, bBETA and bGAMMA, will be announced in due course the blog post added.

BDP Price Update

At the time of writing, BDP was trading at $5.85, falling 19% on the day after hitting a peak of just over $14 on Sunday, March 7.

The bALPHA price is a little over $10,000 per token after skyrocketing to over $40,000 at the weekend according to Coingecko.

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Source: https://cryptopotato.com/big-data-protocol-staking-surges-over-6-billion-in-latest-defi-frenzy/

Blockchain

TA: Bitcoin Turns Attractive Above $50K, Why BTC Extend Its Rally

Published

3 hours ago

March 8, 2021

Republished by Plato

Bitcoin price gained bullish momentum above the $50,000 resistance against the US Dollar. BTC traded towards $52,000 and it remains supported for more upsides.

Bitcoin started a fresh increase above the $50,000 and $50,500 resistance levels.
The price is now trading well above $50,000 and the 100 hourly simple moving average.
There is a key rising channel forming with support at $50,500 on the hourly chart of the BTC/USD pair (data feed from Kraken).
The pair could correct a few points, but the bulls are likely to protect $50,000 and $49,500.

Bitcoin Price Starts Fresh Increase

After a strong close above the $48,000 level, bitcoin started a fresh increase. BTC was able to clear the key $50,000 and $50,500 resistance levels to move into a positive zone.

There was also a break above a major bearish trend line with resistance near $48,400 on the hourly chart of the BTC/USD pair. The pair extended its rise above the $51,000 level and traded to a new weekly high at $51,853.

It is now correcting lower, but it is trading well above $50,000 and the 100 hourly simple moving average. An initial support is near the $50,750 level. It is close to the 23.6% Fib retracement level of the upward wave from the $47,141 swing low to $51,853 high.

Source: BTCUSD on TradingView.com

There is also a key rising channel forming with support at $50,500 on the same chart. The next major support is near the $50,000 level. Any more losses may possibly lead the price towards the 50% Fib retracement level of the upward wave from the $47,141 swing low to $51,853 high near $49,500. The main support is now forming near the $48,800 level and the 100 hourly simple moving average.

More Upsides in BTC?

If bitcoin stays above $50,500 and $49,500, it could start a fresh increase. An initial resistance on the upside is near the $51,500 level. The first major resistance is near the $52,000 level.

A successful close above the $52,000 resistance level could open the doors for a larger increase in the coming sessions. The next major resistance could be $53,200, followed by $54,500.

Technical indicators:

Hourly MACD – The MACD is now gaining momentum in the bullish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now well above the 50 level.

Major Support Levels – $50,500, followed by $50,000.

Major Resistance Levels – $51,500, $52,000 and $53,200.

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Source: https://www.newsbtc.com/analysis/btc/bitcoin-turns-attractive-above-50k/