Ethereum cryptocurrency, physical coin in front of an abstract background
Ethereum successfully executes Merge event
At 2:45 am EST (12:15 pm IST), the Ethereum network successfully began its transition from proof of work to proof of stake.
In proof of work, Ethereum (ETH) was generated by “mining,” an energy-intensive process by which individuals directed huge amounts of computing power at difficult-to-solve puzzles. Under the proof of stake mechanism, new ETH is generated by individuals and entities pledging large amounts of pre-existing ETH. The transition is anticipated to be faster, more scalable, and 99.9% more environmentally friendly.
Crypto prices today: Bitcoin falls 0.4%, ETH up 0.6%
Bitcoin is currently trading at $20,230.4, a decline of 0.43% over the previous day. Ethereum is up 0.66% over the last 24 hours to $1,624.23. Solana rose 2.31% to $34.33, while Cardano is trading higher by 1.3% at $0.479. Avalanche (AVAX) rose 0.51% to $19.21. The global crypto market cap stands at $994.19 billion, a 0.4% decline over the previous day.
Binance sees record rise in Indian users after imposition of new crypto tax
The number of Indian user sign-ups has surged on global crypto exchange Binance after a 1% tax deducted at source (TDS) came into effect in July. Binance app downloads in India jumped to 429,000 in August 2022. Meanwhile, daily trading volumes at several India-based crypto exchanges have reportedly declined over 90% since the 1% TDS took effect.
South Korean authorities issue arrest warrant for Terra’s Do Kwon
A court in Seoul issued an arrest warrant for Do Kwon, the CEO and founder of TerraForm Labs, following an ongoing investigation into the collapse of the Terra ecosystem. The warrant also targets five more individuals who are currently residing in Singapore for violation of capital market rules. Terra Labs’ stablecoin UST and its sister token LUNA crashed heavily in May 2022. It resulted in the wipeout of at least $40 billion of investors’ wealth.
Do Kwon and Terra Labs slapped with class-action suit
An Illinois resident sued Terraform Labs, its founder Do Kwon, and several venture capitalist (VC) firms that make up the Luna Foundation Guard (LFG). The lawsuit claims that the defendants violated federal securities laws and misled investors. LUNA and TerraUSD (UST) collapsed last month after the stablecoin lost its peg. An attempt to relaunch LUNA has so far failed to bring investors back to the project.
Crypto prices today: Bitcoin surges 8.8%, ETH up 12%
Bitcoin is currently trading at $19.953.99, surging 8.82% over the previous day. Ethereum is up 12% over the last 24 hours to $1,072.58. Solana rose 9.26% to $31.95, while Cardano is trading higher by 4.5% at $0.465. Avalanche (AVAX) jumped 11.45% to $15.68. The global crypto market cap stands at $874.88 billion, a 6.66% increase over the previous day.
Iran to cut electricity to authorized crypto miners: Report
As per a Bloomberg report, the Iranian govt is restricting crypto mining activity as it tries to ease the strain on the country’s power supply. Electricity to all 118 state-authorized mining operators in Iran will be cut off from June 22 ahead of seasonal spikes in power demand.
Celsius says it’ll ‘take time’ to stabilize its liquidity
A week after freezing withdrawals, crypto lending platform Celsius Networks Ltd. said it will “take time” to stabilize its liquidity and operations. Earlier this month, Celsius announced it was pausing withdrawals, swaps, and transfers “due to extreme market conditions.”
India is finalizing a crypto consultation paper: Govt. official
Economic Affairs Secretary Ajay Seth said a consultation paper on crypto is “fairly ready”. He was speaking at an event organized by the Finance Ministry. Seth has called for a global consensus on crypto regulation. The paper is a result of consultation from various domestic and international players, including the World Bank and the International Monetary Fund.
The crypto industry in India has been struggling to cope with unclear rules and market volatility. Even payment processors are cutting off exchanges.
Crypto prices today: Bitcoin rises 3%, ETH up 3.5%
Bitcoin is currently trading at $31,537.8, a 3% increase over the previous day. Ethereum rose 3.6% over the last 24 hours to $1,970.87. Solana fell 1% to $46.21, while Cardano jumped 26.9% at $0.659. Avalanche (AVAX) fell 3.6% to $26.6. The global crypto market cap stands at $1.31 trillion, a 2.7% increase over the previous day.
South Korean authorities launch probe into Terra crash: Report
As per a report by JTBC (local TV network), South Korean prosecutors are looking into the recent Terra crash to see if there were signs of intentional price manipulation and other issues. The Seoul Southern District Prosecutors’ Office’s joint financial and securities crime investigation team has summoned former employees of Terraform Labs who were involved in the initial development of the Terra ecosystem in 2019.
Prada to launch 100 Ethereum NFTs
Luxury brand Prada will be launching 100 Ethereum NFTs on June 2nd as part of its latest Timecapsule apparel release. Buyers will receive a free airdropped NFT to go along with their physical merch purchase from Prada’s latest collaboration with artist Cassius Hirst.
Russia to consider using crypto for international payments
As per a report from Interfax, Russia is considering allowing crypto to be used for international payments. The move could allow the country to counter the sanctions implemented by western countries as a consequence of its invasion of Ukraine. However, Russia’s Central Bank and Finance Ministry are yet to reach a consensus on crypto regulation.
Robinhood is building a standalone, non-custodial wallet that will give customers full control over their crypto assets. The new product will be similar to Web3-focused products like MetaMask and Coinbase Wallet that give users full control but also require them to manage their own private keys. It will let users trade and swap crypto with no network fees, access DeFi services, and store NFTs.
Crypto prices today: Bitcoin, ETH falls 2%
Bitcoin is currently trading at $29,812.6, a 2% decline over the previous day. Ethereum fell 2.14% over the last 24 hours to $2,030.36. Solana fell 1.9% to $55.27, while Cardano is trading lower by 2.9% at $0.561. Avalanche (AVAX) fell 1.44% to $33.43. The global crypto market cap stands at $1.28 trillion, a 1.66% decline over the previous day.
Terra’s legal team resigns in wake of UST, LUNA collapse
Terra’s in-house legal team has resigned in the wake of the industry-wide unrest generated by Terra’s collapse last week. Terra’s algorithmic stablecoin UST crashed last week, bringing Terra’s native token LUNA down with it and wiping out $40 billion in value in the process.
Getty Images to launch first NFTs on Palm through Candy Digital
Getty Images has entered the non-fungible token (NFT) world. It will mint NFTs on the Palm blockchain, an Ethereum-compatible sidechain. Getty Images will draw from its collection of over 465 million images, including 135 analog photographs, with a focus on turning never-before-seen archival works into NFTs.
G7 Finance Chiefs to discuss crypto-asset regulation
The regulation of crypto-assets is likely to be discussed at a meeting of Group of Seven finance chiefs this week in Germany, said French central bank head Francois Villeroy de Galhau. “What happened in the recent past is a wake-up call for the urgent need for global regulation,” he told an emerging markets conference in Paris.
Terra temporarily halts blockchain to prevent attacks
After Terra’s UST stablecoin lost its US dollar peg earlier this week, the firm’s crypto token LUNA crashed. After losing nearly 100% of its value over the past week, Terra validators announced that they would halt the blockchain. Given how dramatically the price of the LUNA has fallen, the blockchain network rapidly became prone to attacks. The blockchain resumed block production nearly one and a half hours after the halt.
Crypto prices today: Bitcoin jumps 9%, ETH rises 10%
Bitcoin is currently trading at $30,319.92, an 9.3% increase over the previous day. Ethereum jumped 10,7% over the last 24 hours to $2,074.65. Solana surged 32.5% to $51.6, while Cardano is trading higher by 24.5% at $0.569. Avalanche (AVAX) rose 45.65% to $34.6. The global crypto market cap stands at $1.30 trillion, a 16.25% increase over the previous day.
Global crypto regulation body likely in next year, says top official
Global market regulators are likely to launch a joint body within the next year t0 coordinate crypto rules. Ashley Alder, Chair of the International Organization of Securities Commissions (IOSCO), said the boom in digital currencies was one of the three main areas authorities are now focused on, along with COVID-19 and climate change.
Nomura offers its first Bitcoin derivatives
Japenese investment bank Nomura has begun offering Bitcoin over-the-counter derivatives to clients. This is the latest move by a traditional financial institution into the crypto industry. Nomura’s s clients can start trading Bitcoin futures and options in the market.
Ethereum gas prices surge
Ethereum gas prices more than doubled from Tuesday to Wednesday and were on track to double again on Thursday, as per data from blockchain explorer Etherscan. The increase in gas price is mainly due to transfers involving the addresses of centralized stablecoins, Tether, and USDC. Tether stablecoin transactions have accumulated the most in fees over the last 24 hours.
[Gas fees are the transaction fees that users pay to miners on a blockchain protocol to have their transaction included in the block.]
Stablecoin Terra (LUNA) plunged more than 60% to $10 over the last 24 hours amid the bloodbath in the crypto market. The token dropped over 85% over the previous seven days. Its price has fallen more than 91% from its record high of $119.8 in April this year. Terra is a blockchain protocol that uses fiat-pegged stablecoins to power price-stable global payments systems.
Crypto prices today: Bitcoin falls 5%, ETH down 2.2%
Bitcoin is currently trading at $30,407.05, a 5.26% decline over the previous day. Ethereum is down 4.9% over the last 24 hours to $2,281.9. Solana crashed 12.16% to $62.32, while Cardano is trading lower by 10.7% at $0.602. Avalanche (AVAX) plumetted 19.7% to $37.02. The global crypto market cap stands at $1.37 trillion, a 6.77% decline over the previous day.
Halted UPI payments due to“informal pressure” from the RBI: Coinbase CEO
Brian Armstrong, CEO of Coinbase, said the company disabled its Unified Payments Interface (UPI) services because of “informal pressure” from the Reserve Bank of India. The crypto exchange is working with the RBI and plans its return to India with other payment systems in a relatively short time. It launched its operations in India on April 7 through a mega event in Bengaluru.
Crypto industry wants Centre to lower TDS on transactions
The crypto industry has urged the Central Government to reduce the tax deducted at source (TDS) on payments towards gains arising from trading in crypto to 0.01% or 0.05% from the proposed 1%, saying it will hurt retail traders. CoinDCX CEO Sumit Gupta said the 30% tax on income from crypto is on the higher side and should be reduced.
EU ban on tax-haven crypto firms could breach trade law, warns Commission
A proposed European Union (EU) ban on crypto providers offering services from tax and money laundering havens raises “serious doubts”. The ban could breach global trade rules, according to a European Commission document. Lawmakers from the European Parliament said that crypto-asset providers should not be authorized to offer services in the bloc if they are from shady jurisdictions like Panama. However, the Commission does not agree with this.
While investing or trading in cryptocurrencies, you might have come across a category of tokens known as DeFi or Decentralised Finance. With the advancement of blockchain technology and a large variety of cryptos, many consider DeFi to be the future of financing in the world. In this article, we dive into the world of Decentralised Finance (DeFi) and some of its applications.
Before diving into DeFi, it is important to understand what a centralised financial system is. As the name suggests, centralised finance (or CeFi) consists of intermediaries such as banks and other financial institutions that act as the central point of access to all forms of financial services. Bill payments, investments, and wealth management are conducted via traditional banking systems. The current system is controlled by a central authority (such as the Reserve Bank of India) at every stage. Banks control/manage our accounts and validate all transactions.
Despite its popularity, centralised finance faces certain drawbacks. Many people across the globe still do not have access to banks or basic financial services. There can be risks of inflation due to mismanagement by central authorities. Storing and transacting money can be costly and inefficient. In the current scenario, centralised financial systems are prone to fraud and corruption.
Thus, the creators of decentralised financing systems and applications aim to address the flaws of the centralised financial system.
What is Decentralised Finance (DeFi)?
Decentralised Finance or DeFi is a broad term that includes peer-to-peer (P2P) financial services or applications built on public blockchains, primarily Ethereum. It removes all intermediaries (or central authorities) that grant permission for conducting financial activities. You will be able to earn interest, borrow, lend, buy insurance, and trade derivatives via decentralised apps (dApps).
DeFi requires infrastructure such as the Ethereum blockchain for programming and running decentralised financial services. One can write automated code (or smart contracts) on the Ethereum network to create or manage financial services. These smart contracts will automatically execute financial transactions if certain conditions are met. Developers have built DeFi-based exchanges, lending services, and even insurance companies that are not controlled by any entity.
The top DeFi projects being developed around the world today aim to bring more flexibility and transparency to financial services and transactions. It also aims to improve transaction speed and costs. Also, anyone can create, modify, mix and match, link, or build on top of existing DeFi products without permission.
Popular Applications of DeFi
Decentralised Exchanges (DEXs) are online exchanges that help users buy, sell or trade cryptocurrencies. For example, you can exchange the US Dollar for Bitcoin, Ether, or DAI on a DEX. [DAI is a stablecoin whose value is pegged to the US Dollar. It is protected from the wild price swings that are usually associated with cryptocurrencies.] DEXs connect users directly so they can trade cryptocurrencies with one another without having to trust an intermediary with their money.
When you trade on a DEX, there are no exchange operators, ID verification systems, or withdrawal fees. Instead, smart contracts built on the Ethereum platform enforce rules, execute trades, and securely handle funds.
DeFi-based lending is a rapidly growing segment of decentralised finance. With the help of DeFi lending protocols, you will be able to use your crypto holdings to obtain loans. These loans are easy to obtain and more affordable than those you get from traditional banks. On the other hand, users can also obtain interest for lending out their money. DeFi-based platforms use smart contracts to replace intermediaries such as banks that manage lending activities.
Stablecoins are another form of DeFi. They are a class of cryptocurrencies backed by reserve assets (cash or commodity). It attempts to offer price stability while ensuring all basic features or benefits of cryptocurrencies. Tether is an example of a stablecoin. Each Tether (USDT) is pegged to (or backed by) 1 US Dollar.
Yield Farming is considered one of the most promising use cases of DeFi. It is the practice of staking or lending crypto assets in order to generate high returns or rewards in the form of additional cryptocurrency. Using DeFi protocols, a crypto holder can essentially “farm” for more crypto tokens by using his existing holdings.
Decentralized insurance in DeFi aims to make insurance cheaper and more transparent. Due to automation, coverage is more affordable and pay-outs are faster.
Top DeFi Tokens
Top DeFi Crypto Tokens
Features
Terra (LUNA)
An open-source blockchain platform for creating and trading stablecoins pegged against traditional fiat currencies.
Avalanche (AVAX)
A smart contract-capable blockchain platform that focuses on higher transaction speed and low cost.
Chainlink (LINK)
Provides tamper-proof real-world data to smart contracts on the blockchain.
Wrapped Bitcoin (WBTC)
Enable the use of Bitcoin reserves on the Ethereum blockchain.
Uniswap (UNI)
Allows users to buy, sell, and trade cryptos on Ethereum blockchain via smart contract technology.
Dai (DAI)
This coin is based on the Ethereum blockchain and pegged to the US dollar in terms of value.
PancakeSwap (CAKE)
Enables users to swap between cryptocurrencies.
Conclusion
DeFi is the next generation of digital financial services that are enabled by blockchain technology. Such a decentralised system would benefit a large portion of the global population that currently suffers from financial discrimination and high charges. Over time, transactions are going to be faster, transparent, and more accessible globally. More users of dApps would lead to mainstream adoption in society.
However, there are various risks associated with DeFi as it is still in an early stage of infrastructure development. The technology associated with DeFi can have bugs, and if not careful, you could lose your hard-earned money. In the past, there have been instances where smart contracts did not define rules correctly, and hackers found ways to exploit existing loopholes to steal money. Even if you decide to test out any of the existing DeFi projects or services, make sure you use small amounts of money you can afford to lose. It is also vital to understand how a DeFi-based product or service works before using them.
What are your views on DeFi? Let us know in the comments section of the marketfeed app.
