Seeking Yield — Issue #4 – Seeking Yield

Seeking Yield — Issue #4 – Seeking Yield – Medium

Staking Incentive Best Practices is a new series that analyzes staking participation rate and the most effective ways to design a proof-of-stake network.

Our first piece hones in on why we think Tezos and EOS, two seemingly similar projects, have resulted in such different network participation rates.

In future issues, we will discuss block rewards, lock-up periods, slashing penalties, and other variables that influence participation rate.

We live on this data and are proud to provide the crypto community with data-driven analysis about the effectiveness of crypto-economic incentives.

Read Staking Incentive Best Practices — February 2019 here!

Cosmos Hub Mainnet Launches in ~ 10 Days

The Game of Stakes is officially over and the Cosmos Hub will launch in the coming weeks.

Phase I: Network gains stability

The purpose of this initial phase is to deal with any technical hiccups as the chain finds stability. Given the risk of state being reverted, it is highly recommended that you do not arrange to trade Atoms. If there are issues or vulnerabilities with the Cosmos Hub prior to the enablement of transfers, arbitrary state rollbacks should be expected.

Phase II: Transfers enabled

Once the chain is believed to be sufficiently stable, bonded Atom holders vote on whether Atom transfers should be enabled. If the vote rules in favor of transfers and the proposal is accepted, transfers are enabled.

Phase III: Inter-Blockchain Communication (IBC) enabled

When IBC is enabled as part of the core module library within the Cosmos-SDK, application-specific blockchains that are built using the Cosmos-SDK or Tendermint BFT are able to connect to the Cosmos Hub and interoperate with other connected blockchains. End users can also then transfer various tokens and NFTs directly from one IBC-connected chain to another IBC-connected chain without a third party.

Read the full post here.

Set Protocol Introduces Strategy Enabled Tokens

Set Protocol recently announced Strategy Enabled Tokens, which are tokenized trading strategies facilitated by the Set Protocol smart contract system.

The goal of Strategy Enabled Tokens is to make crypto portfolio management both easier and more accessible.

Strategy Enabled Tokens allow crypto investors to:

Gain exposure to passively managed index products that continually rebalance
Automate trading strategies like dollar cost averaging, stop losses, long/short, and buying the dip

Technical details and the mainnet launch plan will be featured in a separate white paper and blog posts.

Read the full announcement from Set Protocol here.

Algorithmic Crypto Trading

The inefficiency of crypto markets makes it a very attractive and potentially lucrative space for algorithmic traders.

Let’s examine two types of trading algorithms: execution algorithms and market making algorithms.

Execution Algorithms

The purpose of an execution algorithm is to transform the state of a portfolio while simultaneously minimizing costs.

There are typically three layers to an execution algorithm:

The Macrotrader: Breaks up parent orders into smaller child orders that are gradually deployed
The Microtrader: Decides whether each child order should be a market or limit order, as well as the price that an order should specify
The Smart Router: Decides how to route executions to trading venues

Market Making Algorithms

Market making is a staple of financial markets. Market makers provide liquidity to market participants in exchange for compensation.

There are three perspectives to consider when designing a market making algorithm:

Market Maker’s Own Perspective: Represented by their inventory
Market Takers’ Perspective: Represented by the order flow
Other Market Makers’ Perspectives: Represented by the order book

Read the full piece by Kevin Zhou if you are interested in learning more about algorithmic trading in crypto.

Current Staking Rewards

We currently support Decred (DCR), Tezos (XTZ), Livepeer (LPT), Dash (DASH), EOS (EOS), and Factom (FCT).

Don’t see your favorite crypto asset? Cosmos, Algorand, Loom, and NuCypher are coming soon. We will keep you updated as we add support for new assets.

Current ETH Lending Yields

There are both on-chain and off-chain crypto asset lending solutions.

Below are various crypto asset lending solutions and annual ETH lending yields.

Published at Sat, 02 Mar 2019 03:20:35 +0000

April 9, 2017

Bitcoin Will Cost $500,000 By 2030 – Snapchat Investor Liew

bitcoin at $500,000 by 2030 is the latest sky-high prediction to come from high-flying personalities, this time Snapchat’s first investor.

Smith, Liew: Developing Markets Will Drive bitcoin’s Moontrip

In a joint presentation with Blockchain CEO Peter Smith, Jeremy Liew, whose stake in Snapchat is now worth $2 billion, said that external factors driving interest in bitcoin would propel it to unseen heights in the coming decade.

Remittance increases, mobile penetration and political uncertainty top the list.

Business Insider quoted Liew and Smith as saying:

We believe bitcoin awareness, high liquidity, ease of transport and continued market outperformance as geopolitical risks mount, will make bitcoin a strong contender for investment at a consumer and investor level.

Developing countries represent a significant market for bitcoin, with countries such as Kenya already conducting financial activities via mobile, having skipped banking in what was previously a highly cash-driven economy.

With such mobile monopolies come easier remittances. In Kenya, dedicated startup BitPesa is already cornering both markets with bitcoin.

Enough users, according to Smith and Liew, and the virtual currency’s value will take care of itself.

“Put another way, we need a population of bitcoin users around a quarter of the Chinese population (or 5% of the global population) in 2030 to see bitcoin at $500k,” they said.

bitcoin Slow And Steady In 2017 – $1000 A Piece

Current hurdles facing bitcoin propagation, specifically network capacity and the wary approach taken to related financial instruments by regulators, do not faze Smith in particular.

“The SEC’s ruling wasn’t a surprise to us,” he said about the Winklevoss twins’ rejected Bitcoin ETF.

“We know that getting this sort of approval is going to take (a potentially long) time. In the meantime, bitcoin is already simple to buy and hold and, as the asset continues to mature, we’ll continue to see an increase in the development and deployment of surrounding products.”

Nonetheless, in keeping with the current sentiment, both agree on a 2017 bitcoin price of $1000 – slightly less than today’s spot rate.

bitcoin’s Reliability Unrivalled Despite Problems

Other recent price estimates to come from well-known sources include several from Vinny Lingham, who in December forecast $3000 this year.

His optimism came with a hint of caution, however, the entrepreneur adding that too rapid a price increase would be detrimental to the industry and reintroduce volatility and associated lack of trust.

Smith concluded:

…bitcoin is incredibly resilient and stable…In fact, the bitcoin Blockchain has operated for 7+ years with no downtime, a feat no other back-end system operating at this scale can claim.

What do you think about Jeremy Liew and Peter Smith’s forecast? Let us know in the comments below!

Images courtesy of Coinbase, Blockchain, Shutterstock

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