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Future of DPoS in Three Projects: CyberMiles, EOS and TRON

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Delegated Proof of Stake (or ‘DPoS’) is a consensus model which seeks to supersede the likes of progenitors Proof of Work (PoW) and Proof of Stake (PoS) – with promises of increased efficiency and greater representative democracy amongst coin holders with regards to platform decision making.

A consensus mechanism is how blocks are verified, with in-built protocol to attempt to prevent faults such as unintended forks.

Rather than its predecessors DPoS has been described as many as being more akin to what is called the Proof of Action, rather than its namesake of PoS. It has also been described as an approach in which “People in a particular cryptocurrency community vote for Witnesses to secure their computer network.”

What is It?

Delegated Proof of Stake isn’t all that dissimilar from PoS when you look at it. Investors stake their token holdings in a voting procedure which decides the appointment of a select number of ‘delegates’ or ‘witnesses’ (rather than the free-for-all miner approach of PoW).

These individuals are responsible for a wide range of important responsibilities pending to network operation. At any point, stakeholders can revoke their vote of confidence in these delegates if they feel that they are underperforming or incapable of their duties.

Since DPoS is an as-yet lesser adopted consensus mechanism, there is a wide range of different approaches in place at present – and little in the way of standardised definitions. To best understand the ways in which it can be applied, as well as the different interpretations of this still nascent technology available present.

1. Decentralizing E-Commerce

CyberMiles intends to utilise a combination of trusted and original technologies with the intention of decentralizing e-commerce through decentralized blockchain technology. The platform intends to migrate to its own independent blockchain on October 15th, 2018 and currently resides on the Ethereum blockchain, however it incorporates DPoS.

CMT Cubes are one of the most unique aspects of the CyberMiles approach, and they play the role of ‘delegators. The cubes are hardware-based and act as the primary method of staking internal currency (‘CMT’s) towards the election of blockchain validators.

They will be available for investors to purchase and they are also promised to feature an easy-to-use user interface, along with in-built security features and low power-consumption.

The team’s proprietary programming language for smart contracts and DApps is entitled Lity and acts as the foundation for all projects built on their platform. It will also be cross-compatible with Solidity.

Time will tell as to whether CyberMiles’ approach will be successful, with token pre-sales (along with Cube sales and the launch of their main net) set to begin as soon as October 15th, 2018.

2. Creating an Operating System for DApps

EOS is a project with a massive token, and this is proven on record with the eponymous cryptocurrency ranking at number 5 on CoinMarketCap’s top 100 listing. It is valued at $5.25 USD a piece at the time of writing, with a $4,756,512,072 USD market cap.

The EOS ecosystem has been referred to widely as a blockchain infrastructure for commercial-scale DApps, as well as “the first blockchain operating system”. With the EOS implementation of DPoS: we can quite literally state that the coin fuels the operation of the platform.

With what’s called ‘Approval Voting’ each EOS token-holder can take part in a voting process where they are allowed to stake their holdings towards a maximum of 30 candidates. Investor power is proportional with a single token counting for a single vote, and at the end of the process a total of 21 validators are chosen. These validators are referred to by EOS as ‘blockchain producers.

EOS has been the victim of a handful of attacks due to its popularity, exposing security flaws in their system. Despite this it remains popular, as well as receiving attention in Hacked.com’s Trade Recommendations section.

3. Decentralizing the Internet

TRON is the final project which we will be investigating and it’s another top-ranking coin on market-cap aggregates. A multifaceted blockchain based project and utility-token which incorporates a wide range of technologies, TRON’s ethos is the facilitation of the decentralization of the internet.

The company’s flagship product is called the ‘TRON Protocol’ and like EOS it posits itself as something of a blockchain based ‘operating system’, acting as the foundation for DApps and other projects to build their own solutions.

Additional creations available at present include the TRON Blockchain Explorer, and Project Genesis: a reward pool distributed as incentives for events such as programming contests – as well as the ‘Tron Accelerator Loan’.

TRON goes as far as to call their DPoS approach ‘TPOS’ to differentiate it from the many other interpretations which exist. One of the most impressive factors in comparison to peers is the size of the delegate community which they have achieved. They call delegates ‘Super Representatives’ and they have 143 of them, in addition to 937 online nodes.

Like the change in names, most of the changes from DPoS here are superficial and do not present any major differences in technical operation. The coin has been reportedly showing signs of promise with regards to market value for its proprietary TRX coin recently.

The Future of DPoS

Delegated Proof of Stake has raised a lot of questions within the crypto community: particularly due to its experimental nature, however examples such as CyberMiles, EOS, and Tron demonstrate promising and successful implementations of the protocol.

With the rise of DPoS based solutions, it would appear that we are likely approaching a moment where it may rank amongst (and as a viable alternative to) the traditional PoW and PoS consensus mechanisms. Some of these projects are even listed in the top 100 cryptocurrencies with regards to market capitalization.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Why Investors Should Pay Attention to Kyber Network

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The current cryptocurrency ecosystem isn’t nearly as well-connected as it should be. Some coins are very difficult to exchange, and others are very hard to find on any of the common centralized exchanges. This often leads to users going to services like Binance, but in an industry as innovative as the blockchain industry, some new methods have popped up that show promise.

Decentralized exchanges have been popping up everywhere, but Kyber Network has formulated a unique approach to the liquidity and volume problems that currently plague most of these exchanges.

Kyber Network’s Mission

The basic need for Kyber Network comes from the idea that the current evolution of the blockchain ecosystem is incomplete and there is much more that could (and should) be done. The regulations currently in place have made it difficult for centralized exchanges to effectively list new coins, and many crypto-enthusiasts end up stuck with a high variety of digital assets.

Centralization is generally something that the cryptocurrency industry would like to avoid. As we’ve seen in the last few years, many of the current trading exchanges have a ton of inefficiency, as well as security issues and some bureaucracy. This is where much of the need for decentralized exchanges has originated.

Kyber Network’s top innovation is the elimination of order books in favour of using large reserves. There are numerous reserves in place for each currency, which creates redundancy and reduces centralization. This also allows for instant exchanges, which is helpful since many of the top criticisms of decentralized exchanges was the latency issues that often manifest. Although to be clear, Kyber doesn’t refer to itself as a decentralized exchange, but does generally compete in the same space with them.

The Mechanics of Kyber Network

Kyber Network basically operates as an exchange that allows for the fluid transfer of tokens between individuals, allowing them to give and receive in different tokens. This is great when the person sending has Ethereum, and the person receiving wishes only to hold Stellar Lumens.

The way it works is there are reserve entities that hold large amounts of tokens and are compensated a small fee (or a spread) in exchange for providing liquidity to users.

KNC is the Kyber Network token, and it is generally charged to the reserve entities as a cost of doing business on the network. Each time an exchange occurs, a small transaction fee is charged to the reserve. Reserves make their money on the spreads, and then tokens are charged from the reserve managers.

Recent Performance

2018 has seen Kyber place a significant focus on partnerships and continuing to develop their trading breadth. They partnerships include exchanges and wallets that include OasisDEX, Peepeth, ETHIS, Etheremon, Secrypto, Midas Protocol Wallet and Weswap. Additionally, they are now on the final phase of the development of their platform, which includes supporting the trading of options and forwards contracts.

The KNC token has recently been added to Poloniex, but is trading around $0.38, which represents an approximate drop of 95% from it’s all-time high. It is around 20% above its all-time low, and this makes it a strong buying opportunity right now. KNC can be bought on Binance and a few other altcoin trading exchanges, and serves to be a strong bet if you believe in the mechanics of its trading exchange.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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A Few Lessons From Last Week

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There is an adage on Wall Street.  It is quite old. It was passed down to me from my grandfather last Wednesday.  It goes something like this. When the cops raid the brothel, they take everybody including the piano player.  

No matter when the notion originated, it applies directly, and painfully, to last week’s experience with stocks, bonds and crypto assets. Between early Wednesday and Thursdays New York closing, most major US indices dropped a fast five percent.  Friday showed a tepid rebound with the tech heavy NASDAQ posting a 2.3% one day recovery followed by the S&P 500 with a meager 1.2% upward move. Otherwise there wasn’t much good happening.

The story in crypto land wasn’t any better.  In truth it was worse. Taking just the two big guys during the same Wednesday/Thursday time period, things were dismal.  Bitcoin lost 6% in price before staging a weak 1.1% recovery on Friday. Ether dropped 15.6% on Wednesday, then managed a 3.2% Friday bounce.

Nobody escaped untouched unless you were a short seller in which case, congrats! Having lots of company is hardly any consolation for having to deal with investment losses, even if there are only accounting losses.  Nevertheless, everyone who had the ability to read understood the stock market was on a record breaking binge and thus vulnerable.

The only binge connected to crypto prices was a 10 month long hangover from the record levels of late last year.  So should the Wall Street adage be applied here making crypto take on the role of piano player? Or to present the question in a different way, is the piano player merely an innocent victim of being in the wrong place at the wrong time?

The Stock Market Correction Is Not Over

Stock market corrections are never pleasant but many veteran strategist consider them to be a necessary and even healthy part of the investment process.  Last week’s 5% drop was not even pronounced enough to qualify as a bona fide correction. That requires something even more than the 8%+ drop that took place back in February.  

In the very short term, there is little in economic news that is likely to upset the market this coming week but that doesn’t change the fact that interest rates are putting pressure in bond prices and $80 oil prices aren’t helping the inflation picture either.  Finally, there is the uncertainty created by the midterm elections. Making short run market predictions is a fools game, but this one is an exception.

What Does This Say About Crypto Values?

After events of the last week where already depressed crypto values get beaten down even further than stocks and bonds, that is not a good sign.  One of the reasons for this had to be last weeks report from Diar Ltd. showing how Coinbase’s active customers have dropped 80% from record levels of $24 billion in the fourth quarter of last year to $3 billion in the third quarter of 2018.  News of this study was reported by Bloomberg on Wednesday. So this could well have been the fundamental culprit. If so, the timing could not have been better for the short sellers.

No Longer Trending?

The folks at Diar Ltd. are spot on in their analysis but does this mean the end for crypto? Don’t count on it.  In fact there is a positive side to their findings. The most important point is the crypto prices (except for Wednesday) have become increasingly stable.  This stability will serve long term investors well as it will calm the nerves of regulators and merchants inclined to use crypto as a medium of exchange.

The drop off in activity at Coinbase is not surprising.  Speculators have lost interest. Recently we wrote an article about the competition for investor attention between crypto and cannabis.  There is loads of anecdotal evidence suggesting that this is contributing to crypto interest declining.

Here is just two points to remember.  This week on October 17, cannabis becomes legal for the first time throughout Canada. Investors are acutely aware of this bonanza.  During one of the worst weeks in the stock market, US listed cannabis stocks like Medmen Enterprises (MMNFF: $5.84) gained 35% while APHRIA (APHQF: $14.65) added over 13%.  Both stocks experienced greatly accelerated volume. This is an example of just two of many cannabis opportunities that are challenging crypto for investment capital. So the piano player may not be so innocent: he could just be smoking a little ganja.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.4 stars on average, based on 112 rated postsJames Waggoner is a veteran Wall Street analyst and hedge fund manager who has spent the past few years researching the fintech possibilities of cryptocurrencies. He has a special passion for writing about the future of crypto.




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Altcoins Share Spoils as Global Volume Hits 3-Month Low; Bitcoin Price Remains Stable

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Very little new money has entered the crypto market in the last seven days, with volumes instead falling from $16.8 billion down to $8.9 billion. That’s the lowest that global trade volumes has fallen since July 15th – almost exactly three months ago.

For those curious what happened the last time trade volumes hit such a low point, the previous drop to the $8 billion range was soon followed by a 25% market wide surge. That was during the spike of late July, and those losses were soon wiped out again in August, when global markets sunk by one third.

Since Bitcoin’s descent from the $6,800 range down to the current $6,300 range, BTC has remained just as steady as it was from before October 10th’s dip. BTC has traded within a tight range for the past few days, never once deviating from between $6,240 and $6,340 – a 1.6% band.

Altcoins Share the Spoils

Instead, the majority of market gains have found their way to the altcoin market. While Tron (TRX) leads the major alts with its consistent growth recorded over the past few weeks, the biggest change in the market cap top one-hundred for Sunday goes to Komodo (KMD).

Komodo (KMD)

Komodo (KMD) saw its dollar valuation by just under 13% across Sunday, with the KMD coin jumping from a price of $0.993784 recorded on Sunday morning, up to the $1.12 valuation reached on the same evening.

That leaves KMD just a hop, skip and jump away from the pre-October dip price of $1.18, and marks one of the stronger recoveries from what was termed ‘Thursday, Bloody Thursday’ by some.

KMD volumes followed the rest of the market as they descended by 98% over the last few days, falling from the $3.5 million range down to $350,000. Today’s surge saw volumes rise once more as they climbed to $1.3 million by Sunday evening. Just under 70% of total KMD trades are against BTC today, in an unusual sign of Bitcoin dominance (which recently rose to 54% globally).

DigixDAO, Polymath and Aelf

The other top performers in the top one-hundred have proved to be the smaller altcoins, which often surge first following a market dip. It’s something approaching a lottery trying to guess which altcoin is going to pump, and there’s little to connect today’s market growers.

DigixDAO (DGD), a cryptocurrency backed by physical stores of gold, saw 6% growth over the previous twenty-four period.

Polymath (POLY), a project which seeks to tokenize securities on the blockchain, also climbed by just over 6%, helped in no small part by the 33% of trades coming from the POLY/KRW pair.

Finally, Aelf (ELF), a blockchain-based cloud-computing network, hit just over 5% growth for Sunday. Although, that barely makes up for the 20% loss recorded just a few days ago on October 10th.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.4 stars on average, based on 78 rated postsGreg Thomson is a full-time crypto writer and digital nomad. He eats ICOs for breakfast and bleeds altcoins. Wherever he lays his public key is his home.




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