Moon Mag #24

A note from Lisa…

Editorial

Welcome to the 24th issue of TheMoonMag.com!

As we celebrate our two-year anniversary, we’re filled with nostalgia for traditional magazines that graced coffee tables and bookshelves. Now, you can find us on your iPad or sneak a read at your office desk. Wherever you take a moment to read, we thank you for coming back each month!

In an era dominated by pixels and screens, there’s something magical about flipping through glossy magazine pages. TheMoonMag. com embraces this nostalgia while being a beacon of positivity in the world of crypto. Each issue is curated with love and attention, capturing the essence of the crypto market with stunning visuals, engaging narratives, and thought-provoking insights.

As the Crypto and Blockchain industries rapidly move forward, our online magazine embraces the boundless opportunities of the digital era. Being free and online allows us to reach a global audience, connecting with crypto enthusiasts from all walks of life and spreading positive crypto vibes. You too can spread our vibes by sending a link to someone you think needs to know more about the positive side of crypto! I think they will love our multimedia elements, interactive infographics, and hyperlinks, as we make it easier for readers to delve deeper into the topics they find intriguing.

We aim to be a positive force in the crypto world, demystifying complex concepts and offering well-researched insights without sensationalism. Our dedicated team of writers, researchers, and designers work diligently to inform, educate, and inspire our readers.

We’re grateful for our entire team and community of readers whose support, feedback, and enthusiasm fuel our passion for promoting crypto positively.

As we raise a toast to two wonderful years of TheMoonMag.com, we look forward to the exciting journey ahead, especially as we bring you the latest and best projects for the upcoming Bull Market.

Here’s to TheMoonMag.com and to the bright future of crypto! Let’s let Leonardo raise a glass of champagne to US!

Lisa

A note from Josh…

We are 24 issues into the Moon Mag, which means a full 2 years of scouring the crypto industry, picking out greatlooking projects, understanding and explaining the jargon, following the hype and predicting where it might lead and sharing opinions that resonate (or not, sometimes!) with you, our beloved reader. It’s been an incredible journey, and I’m incredibly proud of the efforts of everyone involved. When Lisa first described the concept of the Moon Mag to me, I knew it was destined to happen, but without many other combined talents (and our sponsors!), it just wouldn’t be here today. A huge thanks to all our writers, some have been with us from Day 1, and others have popped in for just 1 or 2 articles. A special thanks to Daniel Jimenez, a fundamental part of the team and a person of many talents, for writing fab articles and helping us share the Mag through the Moon Mag Twitter handle. Behind the scenes, I want to share my gratitude to Alex, who has helped turn text articles in Google Docs into incredibly good-looking and thoughtfully designed magazine issues. The Moon Man on the cover of each Moon Mag has become an icon! I could spend hours just looking at the covers themselves. There are many more who played a part in making the Moon Mag, the Moon Mag but that’s it for my editorial! An offering of thanks, but it feels like a great time to do that.

Thank you to you, our readers, who make this venture all worthwhile. Enjoy the issue!

CONTRIBUTORS

DISCLAIMER

All the content provided for you as part of the Moon Mag has been researched thoroughly and to the best of our ability however it is your choice, and your choice only, whether you wish to invest or participate in any of the projects. We cannot be held responsible for your decisions and the consequences of your actions. We do not provide financial advice. Please DYOR and above all, enjoy the content!

Daniel has been a blockchain technology evangelist since 2012 and is a faithful believer in the Crypto ecosystem. Daniel also writes for Coin Telegraph!

Ibrahim Birima is a Freelance, Crypto and Web3 journalist. The topics he has covered for over a decade encompass politics and education, amongst others, and he is also adept in the Web3, Cryptocurrency and Blockchain domains. He is Head of Content for SMC DAO and writes for Cryptonary.

Freelance journalist dedicated to digital media, enthusiast of the crypto ecosystem and disruptive technologies. MDC writer since 2018, currently writer for CryptoTrendencia.

R.Paulo Delgado

R.Paulo Delgado is a crypto and fintech journalist, freelance writer, and ghost writer. He cut his teeth as a web and software developer for 17 years. Now he uses those skills to write tech, business, and financial content for various businesses and news publications.

Chrom

Chrom here, your friendly blockchain wordsmith! I joined the crypto party in 2017, have worn many hats, and I consider myself Jack of all trades. Been working as a DAO contributor, start-up advisor & research leader. Armed with a knack for turning technical jargon into engaging content. I fuse quirkiness and professionalism to deliver informative, optimistic writing that resonates with readers.

Ibrahim Birima

Samantha Jimenez

Daniel Jimenez

written by Lisa N. Edwards

The scenario - You’re new to crypto, probably from traditional markets and have seen all the high percentages in crypto and think… I want a piece of that; I only get 2-3% in Stonks and, on a good day, 10%. Or you are completely new to trading and just want to get rich quick, and crypto is going to do it for you…

Let me tell you now; these are the people that get completely REKT!

The participation of traders and investors from traditional financial markets and noobs just entering the market contributes to the volatility of the crypto market. As more traditional traders enter the crypto space, they bring their strategies and trading approaches from established markets. However,(insert dun dun dun) it’s important to note that the crypto market operates differently from traditional markets, with unique characteristics and dynamics. The influx of traditional traders can introduce both stability and volatility.

On one hand, their experience and expertise can bring liquidity and maturity to the market. On the other hand, their tendency to apply traditional market strategies without fully understanding the nuances of the crypto market can amplify volatility and lead to unexpected price swings.

Like lambs going to a slaughter… crypto whales know how traditional traders trade and how to take their money.

The interplay between traditional traders and the crypto market whales further underscores the need for education, research, and adaptation to the specific dynamics of the cryptocurrency space.

What Drives the Wild Swings in Bitcoin and Altcoins?

The crypto market has witnessed tremendous growth and popularity in recent years; if you have been here a while… you know this with cryptocurrencies like Bitcoin and altcoins capturing the attention of investors worldwide. When news coverage explodes, people in the space know the market is reaching its peak. Unfortunately, this is also when many newcomers enter and are either left to sell the bottom or HODL and forget for years to come; some of these newcomers also study and become traders like you reading this article.

If you’re a long-term crypto trader, that is exactly why you are here, the ability to make 10-50%, sometimes more, in a day! But if you don’t set your trades up properly or get greedy, it can just as easily go the other way.

Here’s a brief rundown of some different scenarios that can affect the prices of cryptocurrencies which often experience wild swings, with significant gains and losses occurring within short timeframes. Understanding the driving forces behind this volatility is crucial for investors and enthusiasts alike.

• Market Liquidity and Trading Volumes: The crypto market is relatively small compared to traditional financial markets, which means that even small trades or significant buy/sell orders can have a substantial impact on prices. Low liquidity and trading volumes make it easier for market participants to manipulate prices, creating sharp fluctuations. Cryptocurrencies with lower market capitalization are particularly susceptible to this phenomenon, as they are more prone to pumpand-dump schemes and price manipulation.

• Regulatory Environment and Government Actions: The regulatory landscape surrounding cryptocurrencies is constantly evolving and varies from country to country. Announcements of new regulations, bans, or restrictions can have a significant impact on market sentiment and price movements. For example, when China announced a crackdown on crypto mining and trading activities, the market experienced a significant downturn as it affected a large portion of the mining infrastructure.

• Market Psychology and Sentiment: Psychological factors play a crucial role in the volatility of the crypto market. Investor sentiment, fear, and greed can drive prices to extreme levels. FOMO (Fear of Missing Out) and FUD (Fear, Uncertainty, and Doubt) are prevalent emotions that can lead to irrational buying or selling decisions. Social media platforms and news outlets can amplify these sentiments, causing rapid price swings.

• Technological Developments and Innovation: The crypto market is driven by technological advancements and innovations. News of significant developments, such as protocol upgrades, new partnerships, or the integration of cryptocurrencies into mainstream financial systems, can have a profound impact on prices. Positive developments often lead to price increases, while negative news can trigger sharp sell-offs.

• Market Manipulation and Whales: Market manipulation is an unfortunate reality in the crypto market. Whales, individuals or entities with substantial cryptocurrency holdings can influence prices by executing large trades. They can create buy or sell walls, trigger stop-loss orders, or engage in wash trading to manipulate the market. Such actions can result in artificial price volatility.

• Economic and Geopolitical Factors: Cryptocurrencies are not immune to broader economic and geopolitical factors. Economic indicators, such as inflation rates, interest rates, and global financial crises, can influence investor behaviour and subsequently impact crypto prices. Geopolitical events, such as regulatory decisions, political instability, or trade wars, can also contribute to market volatility.

• Lack of Fundamental Value and Price Discovery: Unlike traditional assets such as stocks or commodities, cryptocurrencies often lack clear fundamental value metrics. Valuation models used in traditional markets are not directly applicable to cryptocurrencies. The absence of fundamental analysis and price discovery mechanisms can contribute to exaggerated price movements driven solely by market speculation and sentiment.

I will leave you navigating the crypto market’s wild swings is like riding a roller coaster with no safety bar. It’s thrilling, but it can also leave you feeling queasy and wondering what just happened. So, whether you’re a traditional trader venturing into the crypto space or a wide-eyed noob dreaming of Lambos and moonshots, buckle up and prepare for a bumpy ride.

Remember, in this crypto circus, liquidity and trading volumes are the tightrope walkers. Even a small trade or a massive buy/sell order can send prices tumbling or soaring, leaving spectators in awe or panic. It’s like watching a magic show where market participants can pull rabbits out of their digital hats and make prices disappear faster than a Houdini trick.

But wait, there’s more! The regulatory environment and government actions are the unexpected plot twists in this thrilling crypto drama. Just when you thought you were safe, a government announcement can turn your dreams of crypto riches into a nightmare. It’s like a suspenseful movie where the villain shows up out of nowhere, and you’re left wondering, “Who wrote this script?”

Of course, we can’t forget the role of market psychology and sentiment, those mischievous little devils that play with our emotions. Fear of Missing Out (FOMO) and Fear, Uncertainty, and Doubt (FUD) are like mischievous gremlins that whisper in our ears, urging us to buy high and sell low. It’s like having a group of tiny devils and angels sitting on your shoulders, arguing about whether to HODL or panic sell.

In this crypto carnival, technological developments and innovation are the fireworks that light up the sky. Positive news about upgrades and partnerships can send prices skyrocketing, while negative news can make them plummet like a failed fireworks display. It’s like being at a Fourth of July celebration, except the fireworks are powered by blockchain and fueled by speculative frenzy.

And let’s not forget about the crypto whales, those mysterious creatures lurking in the depths of the market. They can make waves with their massive trades, creating a tsunami of price movements that leave smaller fish struggling to stay afloat. It’s like swimming with sharks, hoping you don’t get bitten by their market manipulation tactics.

So, fellow crypto enthusiasts and brave traders, as you venture into this unpredictable world of cryptocurrencies, remember to bring your sense of humour along for the ride. Embrace the roller coaster, and enjoy the show, but always stay informed, keep a cool head, and don’t forget to hold onto your crypto hats tightly. Because in this wild crypto circus, anything can happen, and the only guarantee is that it will be one heck of a ride!

Central Bank Digital Currencies

(CBDCs): Will They Replace Traditional Fiat?

written by Daniel Jimenez

Central bank digital currencies (CBDCs) have become a debate topic in the financial world as the digital revolution continues transforming various sectors, including finance, thus creating the question: Will CBDCs replace traditional fiat currencies?

According to the Bank International Settlements (BIS), there are more than 2 billion digital transactions worldwide, meaning that the introduction of CBDCs is undoubtedly a significant development in the traditional financial system.

In this post, we will explore CBDCs’ scope compared to traditional fiat money and analyze the implications and opportunities it presents for the banking sector.

Defining Central Bank Digital

Currencies (CBDCs)

Central bank digital currencies, as their name implies, are assets that a central bank exclusively issues and regulates, meaning they remain under its direct control and supervision when available to the general public within an economy.

Unlike traditional money, CBDCs exist only in the digital world, making them easy to transfer in a few seconds, which gives them a utility that ranges from domestic and international payments to loan guarantees, plus they can also stimulate the economy or combat inflation when regulators use them as fiscal policies.

Traditional Fiat Money vs. CBDCs

It is undeniable that traditional fiat currencies, such as the Euro or the Dollar, have played a fundamental role as foundations of the global financial system for a long time, functioning as the basis for economic transactions worldwide.

However, to fully understand the extent of the revolution that CBDCs represent, it is essential to comprehend these traditional currencies.

Traditional fiat currencies are limited because the central bank does not act as an isolated economic actor, making them possible subjects to inflation, counterfeiting, and dependence on intermediaries such as commercial banks and payment service providers (PSPs) that execute the vast majority of transactions.

Source: FED

For this reason, costs can reflect in average transaction fees and tight control over the user during the monetary exchange consisting of the money represented by these fiat currencies and the payment systems that ‘serve society.’

With the introduction and expansion of cryptocurrencies and blockchain technology ten years ago, coupled with the interest in the use of digital assets accelerated during the COVID-19 pandemic, it is evident that governments have felt the stiff competition with the entry of decentralized finance through the use of cryptocurrencies such as Bitcoin.

While many actors such as the IMF, the BIS or the Fed itself have denied the extent of their concerns about the use of decentralized digital money by millions of users, there is no doubt that the growing adoption of Bitcoin and some stablecoins as mainstream digital payment currencies has driven the current scenario of the CBDC narrative that we are observing in various pilot projects around the world as a complement to traditional fiat money.

While I won’t try to put into context my hyperfavouritism for sovereign, decentralized digital currencies like Bitcoin over any idea of iron-fisted control over my finances by any government, there is no doubt that the traditional monetary system,

whether physical or digital, is a significant player in the world as we know it today.

Therefore, the digital future will undoubtedly remain anchored to the needs of a confluence between the two financial worlds, where CBDCs will play an important role as their use becomes widespread, proven, and successful.

In addition, it is important to highlight the potential benefits of introducing a system of digital currencies issued, backed, and controlled by governments worldwide through their central banks: read CBDCs.

CBDCs can represent a digital form of sovereign currency that seeks to harness the benefits of blockchain technology combined with fiscal policies that ‘guarantee’ the stability of traditional fiat currencies to stakeholders.

To ensure the security and stability of the system, new digital money, such as CBDCs, must fulfil the three base functions: store of value, unit of account, and medium of exchange.

But in addition to the base functions, CBDCs must be adaptable in anticipation of future developments and users’ needs, presenting some advantages to make payments more efficient.

Potential Benefits of CBDCs

The CBDC’s potential benefits are intrinsically related to these projects’ policy objectives, with some variations depending on the jurisdiction where they are to be applied.

Generally speaking, we can point out that there are some expected benefits from a technological point of view to make payments more efficient:

1. - Speed: Primarily, they can provide faster transactions, often in real-time, thanks to the manual processing elimination and intermediaries use.

2.- The previous point connects us to the next one: cost-effectiveness. Today, the costs associated with payment transactions by PSPs or commercial banks for transaction attestation is a factor that has exposed the shortcomings of the traditional finance system compared to its peer, DeFi.

The CBDCs incorporation could reduce the costs associated with payment transactions, such as cash handling, with all the implications that this entails: custody, storage, and transport, for example.

3.- Accessibility: One of the obstacles to traditional banking is accessibility, especially in emerging economies. CBDCs can improve access to services and payment channels for millions of people worldwide, thus improving their life quality by enabling them to access the benefits of digital payment systems for goods and services purchases from their mobile phones with a digital wallet.

4.- Security: Not least, blockchain use (or a derivation of it under the premise of DLT) can provide better security for peer-to-peer transactions. With CBDCs, features such as cryptography for a digital payment infrastructure secure against fraud, counterfeiting and unauthorized access are available compared to the traditional payment system.

5.- Transparency: Finally, CBDCs implementation can lead to greater transparency thanks to the traceability offered by distributed registries as a derivation of nonpermissible blockchain. As each transaction gets immutably recorded in a distributed registry, illegal activities such as money laundering and terrorist financing can be contended due to the traceability provided by this technology.

Some disadvantages of CBDCs

While CBDCs offer more financial stability compared to cryptocurrencies due to the support they have from the central bank that issues them, which in turn is a regulated entity backed by sovereign governments, it is worth noting that they have some points of contention that some financial freedom enthusiasts oppose their implementation.

Since China’s pilot test announcement in 2016, blockchain and cryptocurrency enthusiasts have sounded the alarm about users’ financial movement control.

Control is one of the weak points that central banks will have to work hard to sell to society the idea that a government-controlled network does not defeat the inherent purpose of blockchain, which for many is synonymous with decentralisation.

However, some voices have called that even central banks can dismiss using blockchain for issuing these digital currencies, thus creating the possibility of greater government control over users’ funds.

Source: Ainslie Bullion

On the other hand, with a single currency issued by each government central bank, it is feared that the supply of bank funds available to users will be affected.

Concerns even go beyond a single banking offer. The European Union, in its framework of understanding for the creation of a CBDC, is considering limiting a certain amount of digital currencies available to users and preventing their use for savings methods, intending to avoid collisions with commercial banking interests, thus limiting exchange difficulties between public and private institutions.

Finally, security is an issue of relevance for single points of failure. As CBDCs get controlled by a single entity, any error or cyber threat against the hosting system could be fatal for the issuing entity.

It is important to note that these are just some of the challenges to which users of CBDCs would get exposed and that there may be new questions as each jurisdiction designs new digital currencies.

Implications and Opportunities

Governments explore the adoption of CBDCs through their central banks, given that, without a doubt, these digital currencies will play a key role in shaping banking.

The adoption of CBDCs will have a potential impact beyond the user experience, offering faster, more convenient and more secure digital transactions than traditional banking. The implementation of CBDCs will have significant implications for monetary policy and the financial stability of many governments.

Governments can gain greater control over the money supply, allowing them more targeted policy intervention on objectives aligned with their interests as CBDCs get implemented.

Furthermore, CBDCs expect to transform financial innovation, enabling new use cases through programmable money, similar to how decentralized finance has revolutionized decentralized lending and automated investment platforms.

The key difference here will be that the control and backing of programmable money will reside with the central bank, i.e. the government. CBDCs will therefore be able to reshape the banking sector with programmable financial applications and impact beyond payment systems.

Commercial banks can leverage this new paradigm and exploit the benefits of operating on the CBDC infrastructure.

Last but not least, the use of CBDCs could have an impact beyond local jurisdictions and is one of the potential use cases expected to be exploited by central banks, such as the near-instant settlement of remittances and crossborder transactions.

A winding road

Source: BIS

While a common framework of understanding has been created in recent years among the world’s major economies to establish the necessary technological and ideological guidelines to pave the way for the future implementation of CBDCs, not all is rosy.

The transition from a current scheme governed by traditional fiat currencies to CBDCs, in my opinion, will have to wait a few years for full implementation due to the hard work involved in such a complex process that requires rigorous planning.

Beyond political will, central banks must have the necessary technological infrastructure for the CBDCs implementation, which are relatively new technology. In addition, to achieve public acceptance, the necessary regulatory frameworks are required.

While some countries’ pilot tests currently employ CBDCs, such as in Sweden, China, and the Bahamas, we must remember that the transition period merits challenges and considerations involving such sensitive issues as individual privacy, cybersecurity, and financial stability.

Source: PwC

According to data from the International Monetary Fund (IMF), only 06 cases of CBDCs in force can test the scope of implementing a digital payment system based on digital currencies backed by central banks.

It is too early to judge whether CBDCs will replace money as we know it, and for now, the two systems seem to converge and complement each other to meet the demands of the new times.

Zealy: A New Age for Web3 Communities

written by Chris

Key Insights

• Zealy is a platform designed to increase engagement in Web3 communities through competitive and rewarding experiences.

• he platform provides tools for blockchain games, NFTs, digital asset marketplaces, DeFi protocols and even web2 businesses.

• Zealy leverages gamified tasks and cryptocurrencies to transform superficial connections into meaningful, productive relationships within online communities.

• Zealy’s success and popularity are reflected in its 500,000 monthly active users across 180 countries, assisting 2,000 companies in engaging, analysing, and scaling their communities.

• Future plans include funding to expand its engineering, product, and design teams and leverage AI technology to maximise community-led strategies.

• Zealy actively supports community initiatives, with every member having the opportunity to make an impact.

• Users can engage with Zealy through its quest-based system, fostering learning and engagement with various cryptocurrency projects.

Meet Zealy, an innovative platform revolutionising the way Web3 communities engage, grow, and transform their members into contributors. In the digital landscape where community engagement is vital, Zealy emerges as a beacon of innovation, paving the path towards a more interactive, immersive, and rewarding Web3 community experience.

Zealy’s model is simple yet powerful – community members compete for the top spots on a leaderboard by completing quests, driving an organic increase in engagement and participation. But Zealy is more than just a competition platform. It serves as a tool for blockchain games, metaverses, digital asset marketplaces, and DeFi protocols such as zkSync, Arbitrum, Polygon, SUI, along with Web2 companies like Renault, PMU, or LVMH, to amplify their reach and boost their online presence.

By fostering a competitive, rewarding environment, Zealy encourages community members to become more than just passive participants. They transform into active contributors, directly influencing the growth and development of the community they belong to. This sense of ownership and accomplishment fuels further engagement, setting up a positive feedback loop that benefits the community and its members.

Furthermore, Zealy’s approach is not limited to Web3. As evident from their partnership with prominent Web2 companies, Zealy is positioning itself as a universal platform to engage, entertain, educate, and grow any online community, regardless of its origin or nature. This scalable and affordable solution is at the heart of Zealy’s vision - to empower every company in the world to become a community-led enterprise.

In essence, Zealy is more than a platform; it’s a paradigm shift in the way online communities are managed and grown. By harnessing the power of competition and rewards, Zealy offers an unprecedented opportunity for Web3 communities to foster growth and engagement, making it an essential tool in the arsenal of every community manager in the digital era.

Background

The genesis of Zealy, formerly known as Crew3, reflects a distinct understanding of a significant problem in the digital age - the underutilisation of community as a valuable asset for businesses. As companies increasingly recognise the potency of community engagement in driving growth and creating joyful customer journeys, an efficient, dynamic, and engaging platform was paramount. Herein lies the birth of Crew3, the precursor to what we now know as Zealy.

Crew3 has founded on the premise that community engagement was the untapped goldmine for businesses. The digital era has provided companies with many ways to connect with their audience, but without a way to engage, analyse, and scale their community, they remained surface-level. To transform these superficial connections into meaningful, productive relationships, Crew3 focused on leveraging gamified tasks and digital assets, turning the often monotonous process of community engagement into an enjoyable, rewarding experience.

The journey from Crew3 to Zealy was marked by a milestone $3.5M pre-seed funding round led by Redalpine. This funding and the company’s rebranding signified a sharpened focus on scaling web3 communities. Other investors included Connect Ventures, Aglaé Ventures, Kima Ventures, Purple, STATION F, Founders Future, Pareto Holdings, and industry expert business angels from The Sandbox, POAP, DFNS, Starton, and Pianity. This financial backing further solidified Zealy’s position as a leading player in the web3 community engagement sphere, empowering the team to refine and expand their platform’s offerings.

The rebranding was not merely a change in name but symbolised a broadening scope for the company. While Crew3 fostered community engagement through gamified tasks and digital assets, Zealy aimed to do more. It sought to transform how communities worked by offering detailed analytics to businesses. These analytics provided insights into which actions improved conversion rates and who the top-performing community members were. With this data, businesses could identify valuable members, such as fans, influencers, or digital asset collectors, and offer them a personalised experience, converting them into ambassadors.

Launched in 2022, Zealy quickly became the go-to-market for all web3 projects. With an impressive count of 500,000 monthly active users, who have completed 100 million tasks across 180 countries, Zealy has proved its efficacy and popularity. Today, it aids 2,000 companies, including web3 leaders and web2 corporates like Renault and Pari Mutuel Urbain (PMU), to engage, analyse, and scale their communities.

Their next goal? Zealy plans to use its funding to grow its engineering, product, and design teams. The company aims to leverage AI technology to maximise the success of community-led strategies and provide a personalised user experience. In just over a year since its inception, Zealy has firmly established itself as an essential tool for scaling community engagement. And as the Zealy journey continues, it seems the platform is just scratching the surface of its potential, promising a future where every company can become a thriving, community-led enterprise.

Team & Founders

Zealy, headquartered at 34 Avenue des Champs Elysées, Paris, was founded by an expert team in 2022, who saw the potential of community engagement tools. The founding team comprises Mathis Grosjean, Louis Demeslay, and Fredrika Lindh, each contributing unique skills and experiences that led to Zealy’s successful inception and continued growth.

To give more context on their expertise:

Mathis Grosjean - Co-Founder & CEO

• Formerly built numerous AI products.

• Expert in growing communities, having led the growth from zero to 30,000 active members.

• Follow him here.

From left to right: Fredrika Lindh, Mathis Grosjean, Louis Demeslay,

source: Zealy Notion credit image: ©Pierre Beecroft

Louis Demeslay - Co-Founder & CTO

• Full-stack developer with proficiency in React, Node.js, Solidity, #C, etc.

• His background in design enhanced Zealy’s product development.

• Follow him here.

Fredrika Lindh - Co-Founder & Product Manager

• The 2nd full-stack developer with a focus on user engagement and rapid iteration.

• Her background offered insights in the intersection of art, blockchain technology, and community management.

• Follow her here.

Jonny Quirk - Head of Community

• 15 years of experience working for startups across the globe.

• Former roles include a regional manager/marketing director position at Yelp.

• Follow him here.

Together, this team embodies Zealy’s vision of harnessing community engagement as a powerful tool for business growth. The lack of effective community tools led them to create the Zealy platform, which is now transforming community-led strategies for businesses worldwide.

Community Impact and Initiatives

On the most important topic, Zealy promotes every community initiative, therefore every member has an opportunity to make an impact. The platform’s approach to building and fostering communities is all about engagement, mutual growth, and creating value for everyone involved.

Key Developments

• In late June, Zealy’s platform saw a significant increase in activity, with 74 new communities launched, demonstrating its growing appeal across various interest groups.

• Over 3,400 quests were claimed, underscoring the engagement and commitment of the Zealy community.

• To enhance the user experience, Zealy rolled out five new features, setting a strong example of the platform’s commitment to constant improvement and innovation.

Events and Participation

Zealy’s active involvement in major events is another testament to its commitment to the web3 community. The company not only participated in the EthCC event but also organized a side event, contributing to the larger industry discourse.

Highlights

The Zealy community is home to diverse projects and initiatives. Among them, StarAtlas stood out, earning recognition as the Project of the Day. The platform also identified the rapid growth of the Retreeb community, designating it as the “upcoming star community.” New promising sprints were also launched from Abyssworld, Tyche, Cryptotanks, and Yieldmos communities, demonstrating the vibrant and dynamic nature of Zealy’s user base.

Acknowledgements

Zealy extends appreciation to its top Discord Community helpers, whose contributions reflect the supportive and collaborative ethos of the community. It’s not something entirely new by any means, nevertheless, it’s a great ‘’habit’’ on their end.

Job Opportunities and Collaborations

Zealy has also proven to be a hub for opportunities within the web3 space. For instance, Takure from UGOKI used the platform to seek a highly experienced community manager and collaborations manager, reinforcing Zealy’s role as a conduit for professional growth and partnership in the web3 ecosystem.

Official Links

Below are the official links from Zealy. Please be aware and only use these links to avoid potential scams. If you encounter a link not listed here, be sure to verify it in Zealy’s official Discord

• Website: https://zealy.io/

• Documentation: https://docs.crew3.xyz/

• Twitter: https://twitter.com/zealy_io

• Linkedin: https://www.linkedin.com/company/zealy-io

• Zealy Careers: https://zealy.io/careers

Zealy Questboards

These are the official Zealy questboards designed to keep you engaged and informed:

• Planet Zealy: https://zealy.io/c/join/questboard

• Zealy Academy: https://zealy.io/c/zealyacademy/questboard

Understanding the Zealy Platform

Zealy offers a gamified journey through web3, where you can dive deep into various cryptocurrency projects via sequential tasks and thrilling quests. It is pretty easy to get started, and then it is up to you All you need is to:

• Connect your wallet

• Find your project

Then, you can follow a chronologically-structured task timeline on numerous platforms, accumulating points along the way and improving your Zealy rating. Earning rewards, including NFTs, privileged access to team communication, or token sale allocations.

The most interesting part, at least for me, is that can join many different projects that I am already following, accrue reward points, and compete against other people which often leads to new friendships!

Engaging with the Crypto Community

By this time I am assuming you already found your favourite project and you are already doing some juicy quests. If you didn’t notice, you often receive a retro drop reward, a token of appreciation for your activities.

Cryptocurrency startups use Zealy to display their projects, fostering an interactive environment with potential investors and community members. It is noteworthy to say that it is much easier to set this up (coming shortly), instead of organizing events on Discord and Telegram.

How to Navigate Zealy

Starting your adventure on Zealy is easy, but the grind is real, especially when you are competing with other. But at the end of the day, you should always have fun doing it.

• Link preferred wallet, or authorize your account through a Discord server.

• Browse through an extensive list of projects.

• Handpick the projects you wish to interact with.

• Unveil a roster of assignments, each promising XP credits.

• Track your progress and maintain a transparent engagement environment.

Creating a Community with Zealy

For anyone looking to build a community, Zealy can assist startups or smaller communities in showcasing their projects. The platform provides:

• An incentive-based, gamified system for users to partake in community activities.

• A quest system to create invite campaigns and encourage Twitter engagements.

• An avenue to host trivia games.

• A data collection system that offers superior insights on community engagement and growth.

Setting Up Your Community

Visit the Zealy website and click on “Create your community.” From there, you can:

• Fill out the prompts with accurate project details.

• Assign roles for your community management team.

• Share a link to invite members to your Zealy community.

• Choose the data users need to provide before joining the community.

Setting Up Quests

Once the setup is complete, you can create quests for your community. Zealy offers templates, or you can start from scratch, tailoring the quests based on submission type, reoccurrence, XP points, and other conditions set by you.

Engagement with Zealy can be a learning curve, a community builder, or a ticket to a thriving crypto project. With its seamless integration of fun and education, Zealy proves to be a robust platform for the crypto-curious and the centhusiasts alike.

Final Remarks - My Thoughts

With Zealy, users can have a simplified yet comprehensive experience of exploring various cryptocurrency projects. It presents a unique approach to learning and engagement, providing users the chance to delve into different aspects of the crypto world. It’s an attractive platform for both newcomers and seasoned enthusiasts, offering a systematic way to engage with cryptocurrency ventures.

From my perspective, Zealy is an innovative platform that’s truly transforming how individuals interact with cryptocurrency projects. The whole

process has been an eye-opening insight into a cutting-edge platform that ingeniously simplifies a realm often seen as complex and intimidating.

The beauty of Zealy is in its ability to blend fun, learning, and practical interaction, all while promoting a sense of community. I was particularly captivated by the platform’s quest-based learning approach, which I believe could significantly encourage novice users to explore the world of crypto, without having to spend countless hours on Twitter or other social media platforms to contribute to their favourite project

To sum up, platforms like Zealy offer a beacon of accessibility and user engagement. It’s remarkable how they are leveling the playing field, allowing anyone, regardless of their technical knowledge, to be a part of the future of finance. The fact that users can earn rewards while navigating through this learning journey truly embodies the spirit of the web3 ecosystem.

I hope this piece encourages you to delve into the vibrant universe of cryptocurrency that Zealy so uniquely unravels. Whether you’re looking to grow a community, learn about crypto, or get involved in exciting projects, Zealy is your go-to platform!

How does an ETF work, and what are the implications for Bitcoin?

written by Daniel Jimenez

Since the giant BlackRock applied for a Bitcoin ETF spot approval in the middle of last month, this product type interest has notably risen among institutional investors.

As a result, the cryptocurrency market reacted positively after other asset management funds emulated BlackRock’s action with the US Securities and Exchange Commission (SEC).

While there has been no definitive announcement on the approval or denial of this new applications stream, expectations of the US regulator’s potential approval of a Bitcoin ETF spot have caused enormous anticipation among traditional cryptocurrency investors and others.

However, some Bitcoin ETF spot ETFs get approved in other latitudes, such as Canada. But due to the positioning of the United States as the dominant economy and the large number of users who own (and invest in) cryptocurrencies, a Bitcoin ETF spot approval in its territory would positively affect the market.

In the expectation of a potential medium to longterm approval of a Bitcoin ETF spot, you, my dear

reader, must understand how such a financial product works to mitigate the risks inherent in an investment that combines the best of traditional and decentralised finance.

What is a Bitcoin ETF?

It is worth clarifying that ETFs, exchange-traded funds, are a basket of various investment assets, offering investors a well-diversified portfolio, which may include commodities, stocks, or bonds, that can be bought and sold on a traditional exchange without buying each asset individually.

Based on the above, Bitcoin ETFs are financial products that allow investors to expose themselves to Bitcoin movement for profit without owning them directly.

In this way, investors do not have to worry about the technical aspects of cryptocurrencies, such as key safekeeping or virtual wallet interaction in the web ecosystem3.

To achieve this, investors do not directly buy bitcoin units but shares in the fund that manages the BTCs.

From a financial perspective, consider spot Bitcoin ETF units as representations of actual underlying bitcoin held in custody on behalf of the ETF’s unit holders.

Generally, the process of a spot Bitcoin ETF is as follows.

1. A buyer purchases units of the ETF on a public exchange.

2. The ETF provider uses the money received to buy real Bitcoin.

3. This bitcoin is held securely in trust by regulated custodians on behalf of the fund provider, usually in cold storage wallets (similar to storing gold in a vault).

4. When a seller wants to redeem its ETF units, the ETF provider sells a corresponding amount of bitcoin to fund that redemption.

Key players in a Bitcoin ETF

Let’s explore what they are to understand the parts that work together to make a Bitcoin ETF work:

1. ETF provider: The company behind the exchange-traded fund that operates and manages this investment vehicle. If BlackRock’s spot Bitcoin ETF is approved, it would be the first provider of this type of spot product.

2. Buyers and Sellers: Any potential investors interested in buying or selling ETF units.

3. Market Makers: Similar to traditional finance, market makers play an important role in Bitcoin ETFs. The Fund Provider authorizes market makers to create and redeem units of the ETF on its behalf. Market makers are institutions that function as wholesale buyers and sellers of ETF units, quite distinct from traditional buyers and sellers, enabling the liquidity necessary for the fund to work.

4. Exchanges: this is the public venue where Bitcoin ETF unit trading occurs on a spot basis, for example, NASDAQ, NYSE.

5. Custodian: Regulated financial products require a custodian authorized by the regulator to hold the fund’s assets in trust. In theory, it is a third-party entity that performs comprehensive functions for the fund provider, including clearing and settlement of money transfers.

6. Fund administrator: A third-party organisation to which the ETF provider outsources administrative tasks such as fund accounting.

7. Cryptocurrency trading counterparties: In practice, these are wholesalers for the purchase/sale of bitcoins that only trade with institutional clients.

8. Cold/hot wallets: As is well known, cold wallets are offline storage, which the custodian uses to keep bitcoins safely. Online (hot) wallets are for transfer settlement.

Inside how an ETF works

Recall that investors who buy Bitcoin ETFs buy shares or units of the fund that use Bitcoin as the underlying asset.

That is, in BlackRock’s hypothetical case with its proposed product through its iShares arm, investors would buy shares of iShares Bitcoin Trust, whose value of each of these units as a whole intends to reflect the closest performance to the price of bitcoin, allowing them exposure to the asset’s price changes for a return, without the need to hold it in a digital wallet or use a crypto exchange.

Now let’s address what happens internally in a fund during its operations.

1. The first step is the ETFs demand. Any investor wishing to acquire this product listed on any public exchange, such as the NYSE, will make the purchase management through the public exchange.

2. As mentioned above, investors purchase Fund units using Bitcoin as the underlying asset. The Market Makers provide the ETF units that get bought and sold on the exchanges to satisfy the demand, and they also determine the price for the sale and purchase of the ETF units to investors.

There is a direct correlation between the Market Makers, the Fund Manager, and the ETF Provider to identify the number of units needed to meet the purchase demand or, in the case of a sale, the ones to get redeemed.

3. The previous is the point differentiating a spot Bitcoin ETF from the other available financial products. For each ETF unit to represent a real asset, in this case, bitcoin, the Fund Provider must take the money received by investors and buy real BITCOIN, which will be held in trust.

Quick note: A trust transfers tangible or intangible trust property to another person for a specified period. The trustee must exercise it for the benefit of the person established as a beneficiary by contract and transfer it to the latter, the trustee, or third parties, according to the established terms, at the end of the trust term.

Upon the current purchase of real bitcoin (in large quantities) demand, the Fund Provider communicates with cryptocurrency trading counterparties about the necessary amount to be purchased.

Once the terms between both parties (Fund Provider and Counterparty) reach an agreement, the transaction is cleared and settled through the sub-custodian and the crypto custodian, which holds the fund in trust, meaning that the acquired bitcoin must not serve any other purpose.

It is important to note that the settlement and clearing process can take from minutes to a few business days.

Implications of a spot Bitcoin ETF

Before proceeding with the ecosystem implications of approving any spot Bitcoin ETF, users should know that several Bitcoin Futures ETFs are currently on the market, which differs from the former regarding their operation and trading.

In the case of Bitcoin Futures ETFs, they have additional expenses due to their monthly rollover, ongoing management, and repositioning by portfolio managers. In addition, the contract’s accuracy in tracking the market differs from the spot market, so there is variation in tracking the bitcoin price.

Increased adoption

With a different approach to Bitcoin Futures ETFs, the likely launch of a spot Bitcoin ETF results in favourable improvements for both Fund Providers and investors, which may positively impact the performance and adoption of cryptocurrencies.

The possibility of increased interest from institutional and retail investors wishing to profit from products anchored to the price of the leading cryptocurrency without needing to interact with it would bring billions of dollars into the Bitcoin market with the approval of a spot Bitcoin ETF.

Liquidity and Market Depth

As we can see from the table above, there are almost $28 billion in assets under management by the nine funds potentially looking to implement a spot Bitcoin ETF. If BlackRock’s product, for example, gets the green light, it could significantly improve the liquidity and depth of the Bitcoin market.

Regulatory openness

Regulatory decisions around Bitcoin ETFs may provide the definitive shape and clarity needed for the cryptocurrency sector for innovation and creativity to flow, producing unprecedented development inside and outside the United States.

Because regulators must protect investors, prevent market manipulation and establish custody solutions to hold bitcoin securely, regulatory hurdles would be a thing of the past, increasing trust among investors of all sizes as the industry grows in innovation and development.

Increased volatility

While Bitcoin is a volatile asset, Bitcoin ETF approval would increase this volatility and market risk. The asset’s price performance could be susceptible to wholesale investors’ large liquidations in the market to meet demands for ETF unit redemptions.

Increased fees and network congestion

Recently, with the introduction of Bitcoin Ordinals, we witnessed the negative network effect of increased demand for Bitcoin transactions. Similarly, these effects are likely to be repeated in the face of institutional order for large transactions, which could lead to high fees that will reduce investor returns.

Consider that each Bitcoin ETF may have a different fee, depending on the exchange-traded Fund Provider, which has a predetermined fee structure in trading the ETF units for commission expenses and management expense ratio (MER).

If the network becomes congested and transaction fees increase, the fund provider will likely implicitly charge this MER cost increase. Therefore, an investor’s unit will have slightly less bitcoin than when he bought it.

Should I Invest in a Bitcoin ETF?

Any user should consider exposure to a spot Bitcoin ETF, even when possessing limited technical knowledge about navigating the web3 Bitcoin ecosystem if they wish to capitalize on the opportunities presented by the BTC market.

As mentioned above, these investment types are ideal for users who do not wish to deal with the technical requirements of using non-custodial wallets or exposure to centralized cryptocurrency exchanges with regulatory shortcuts, which can lead to unwanted experiences in their first attempt to venture into the world of cryptocurrencies.

In addition, one of the biggest hurdles experienced by average investors seeking exposure to Bitcoin is its price. Through a spot Bitcoin ETF, investors can gain exposure to BTC tailored to their budget, risk tolerance, and investment objectives.

For now, while there is no approved market for spot Bitcoin ETF trading within the United States, understanding how it works and what implications its approval could have for the market allows you to be one step ahead to participate in the opportunities that investing in and out of the US offers for this type of product.

For now, you can invest in Bitcoin ETFs with a different approach to the spot Bitcoin ETF through your authorized broker on exchanges such as the New York Stock Exchange and Nasdaq with the following options:

• Proshares Bitcoin Strategy ETF (BITO)

• Valkyrie Bitcoin Strategy ETF (BTF)

• VanEck Bitcoin Strategy ETF (XBTF)

• Global X Blockchain & Bitcoin Strategy ETF (XBFT)

• Global X. “Global X Blockchain & Bitcoin Strategy ETF (BITS)

In other regions of the world, like Australia and Canada, there are similar options to find, including some spot Bitcoin ETF products that are already available for trading outside the United States.

The Role of Governance Tokens in Crypto Projects: A New Paradigm of Participation

written by Paulo Delgado

Cryptocurrency arose from a belief in democracy and putting financial power back into the hands of the people.

Satoshi Nakamoto’s whitepaper emerged in a world in turmoil from the financial system’s nearcollapse due to the fiduciary irresponsibility of entities whom people had entrusted with centralised control. Bitcoin gave life and form to a concept: Financial freedom and democratisation of the financial system.

“Community” forms part of the ethos of crypto

We’ve come a long way from the inflexibility of the Bitcoin blockchain. Smart contracts now power thousands of DeFi protocols, DAOs, and blockchain-based games. But the ethos of that basic democratic ideal continues to inform the actions of the Web3 community. Whether applied to far-reaching, strategic changes such as The Merge, or to the go-to-market strategy for a new NFT collection, the Web3 community is vociferous about any actions that reek of Central Control.

Witness: Porsche’s presumptuous stomp into NFT territory, hubristically assuming that its mere presence would suffice for Web3 denizens to roll out the red carpet and start blowing trumpets. Instead, Porsche was laughed out as “clueless,” “tone-deaf,” and engaging in “cash grab.” Porsche didn’t consider the community.

In contrast, Time Magazine actively engages with its TIMEPieces community, consults it for its next collection, and has thus gained respect in the Web3 community.

In larger, more significant contexts, Ethereum itself felt the pushback of the community when a bad actor hacked The DAO—the first-ever DAO, to all intents and purposes—in 2016 and syphoned $60 million worth of ETH because of a smart contract bug. In response, modern-day Robin Hood, Griff Green, launched a counterattack to “hack the hacker” and recover the stolen funds by stealing them himself.

But the bug remained, and the bad actor could do it again if action wasn’t taken.

The turmoil came to a head when Ethereum leadership recommended a hard fork to roll back the hacker’s transactions and essentially “reset” Ethereum to just before the hack. Some in the community didn’t like that. It went against the nature of decentralisation.

Jeffrey Wilcke, one of Ethereum’s co-founders, wrote in a blog post at the time: “The Hard Fork is a delicate topic and the way we see it, no decision

is the right one. As this is not a decision that can be made by the foundation or any other single entity, we again turn towards the community to assess its wishes in order to provide the most appropriate protocol change.”

He used a voting platform called carbonvote to determine the majority opinion, and 97% voted in favour of the hard fork. Those who dissented stayed on Ethereum Classic, which still exists today.

From manual votes to governance tokens

Using an external voting platform instead of onchain governance tokens to seek out a majority decision is like using paper ballots before electronic voting. It can work, but modern solutions suffer from fewer human errors.

Governance tokens implement the “Code is Law” paradigm. A smart contract takes over once a vote goes through and implements the decision onchain. No central human veto can override it.

We assume the smart contract running it is bugsfree, which was the unique challenge with The DAO. A smart contract bug led to the hack, and the same can occur again if developers deploy code that hasn’t been thoroughly battle-tested.

Incidents like The DAO now form the back-lore of an industry that has grown far more mature. Crypto learned from it, and thousands of DAOs exist now, many driven by governance tokens that empower that DAO’s community.

Even significant players such as Arbitrum are feeling the pressure to be more communitydriven. Arbitrum has adopted governance tokens to decide on proposals for its Arbitrum One and Arbitrum Nova chains.

Uniswap shifted to a community-led model in 2020 when it launched its UNI governance token. Decisions about the protocol now get implemented on-chain through governance token votes. When the token launched, the exchange emphasised its desire to create a free financial system, and that it owed its success to thousands of community members.

Unfortunately, token-weighted voting, also known as “coin voting,” favours wealthier voters and opens the doors to its own risks. This doesn’t invalidate the technology of governance tokens itself, but current implementations seem to pay lip service to the idea of “community” rather than genuinely implementing it. Both Uniswap and Arbitrum use a coin voting governance token.

We need a better solution than coin voting

Ethereum co-founder Vitalik Buterin has written about the risks of coin voting several times on his blog, describing how current implementations of token-weighted systems can create conflicts of interest, favour coin holder interests at the expense

of other members of the community, and that “whales” would have a greater say in community decisions.

The potential for bribery also remains an unaddressed—and dangerous—”elephant in the room,” says Buterik, when using coin voting.

It’s a question of implementation. For example, although crypto can be used to fund illicit activities (just as fiat currency can), that doesn’t make crypto inherently evil. The same applies to governance tokens. As a technological solution for empowering the crypto community, governance tokens are sound.

Developers can implement governance tokens according to whatever smart contract rules they want to. The essential concept remains inviolate: That a “Code is Law” solution exists within blockchain technology that allows protocols to be completely self-sustaining, driven entirely by the communities they serve.

Smart contract developers can implement governance tokens with One-Person, One-Vote paradigms, reputation-based systems, stakeweighting, or even other paradigms that haven’t been developed yet.

We can’t forget that Arbitrum and Uniswap Labs are for-profit organisations. Although the protocols themselves are purportedly decentralised, the primary entity paying taxes behind each one isn’t. It’s unlikely that these or any other for-profit organisations would ever relinquish full control in every possible way.

But the technology of governance tokens remains intact. Implemented in a way that accords fairness to the entire community, they represent a highly workable method to creating a truly decentralised, self-sustaining protocol governed entirely by its users.

Exploring & Comparing Multichain DEXs

written by Chris

Embracing the Shift

In the rapidly evolving space of DeFi, the concept of Multichain Decentralised Exchanges (DEXs) is gaining the spotlight. It’s not simply a trend – it represents a significant shift. DEXs operating across multiple blockchains are breaking down barriers and crafting a more accessible, borderless, and efficient crypto economy.

The Current Challenges

Swapping digital assets across different networks can feel like running a gauntlet. It’s a tricky process, where you move your tokens from one chain to a DEX, swap them through a cross-chain bridge, and then send them from the DEX onto your desired network.

However, it’s not just the complexity of the process that presents a challenge; the substantial cost is also a significant concern. The combination of conversion charges and potential high gas fees can skyrocket (yes, we love ETH), sometimes costing hundreds of dollars for a single transaction. This hefty toll means you can see a sizable chunk of your assets disappear in hefty gas fees.

Official bridges between platforms exist, but they’re usually not user-friendly. Not to mention sometimes it takes several hours for your transaction to be complete. And for our beginner friends, these bridges can be daunting, presenting a steep learning curve. For seasoned players, they can be discouragingly inefficient.

An alternative method involves using centralised exchanges (CEXs) to convert one asset into another. The problem is that they are attractive targets for hackers. It’s like leaving your front door unlocked in a neighbourhood known for break-ins. Even worse, ‘somebody else’ holds your assets, not you.

The crypto saying ‘’not your keys, not your coins’’ is spot-on.

Lately, CEXs have been grappling with the challenge of adhering to new policies, all while facing increased targeting from regulation authorities, while having to comply with KYC rules or revealing sensitive information. Multichain DEXs emerge victorious in this game. The phrase above should act as a reminder of the importance of selfsovereignty in digital asset ownership. It should encourage you to take control of your private keys and not leave your crypto assets at the mercy of third-party platforms.

Why Multichain?

Interoperability sits at the heart of this thrilling transition. Visualise an interconnected DeFi space where you are no longer restricted to a single

chain. Multichain DEXs grant access to trading opportunities spanning numerous blockchains, offering unparalleled flexibility, versatility, and prospects, whether you are the average mom & pop investor, a seasoned trader or even a liquidity provider.

Multichain DEXs stand apart from traditional DEXs due to their ability to support trading across multiple blockchain networks. At their core, they use nodes acting as intermediaries that facilitate the exchange of assets between different chains, a process that brings us closer to cross-chain composability.

The Promise of Multichain

In response to these challenges, Multichain DEXs offer a way forward. They aspire to provide seamless swaps, access more liquidity and improve token swaps between various chains with no prior experience or in-depth knowledge necessary.

In essence, these platforms evolve the traditional DEX into what can be termed an Interoperable Multichain Bridge System (IMBS). The system uses unique algorithms that make swaps via bridges, resulting in low fees and quick conversion times.

Moreover, many DEXs often come with their utility token. This token ensures lower conversion fees across all chains and offers full transparency into these fees before a transaction is finalised. This approach prevents users from getting blindsided by hidden fees.

Apart from its utility function, the token typically serves as a governance token, giving holders a say in upcoming network changes and features (like reducing transaction/gas fees or changing certain parameters).

Multifacet Fronts

Embracing a balanced investment approach is vital in DeFi, especially when navigating the constant ebb and flow of the market.

Here, ‘stop-loss’ tools become an essential part of the arsenal, enabling you to take a break from a constant market watch and keep your investments under control. To further enhance their risk management strategy, DEXs have delved into the concept of ‘Trailing Stop Loss’.

Think of it as a protective shadow that follows your asset’s price, while standing still during a dip. Let’s assume you’ve bought LINK at $20 each. You can set a trailing stop order at 10% to secure at least a 15% profit. As the price of LINK rises to $22, your trailing stop adjusts to $19.80, confirming some of your gains. Now, even if the price falls and the stop-loss is activated, you still walk away with a profit. So, trailing stop loss serves as your personalised market shadow, dynamically adapting to price changes, thus enabling effective risk-trade management. It looks at profits when things go right and minimises losses when the tide turns.

Revolutionising the dynamics of DeFi trading, cross-chain liquidity aggregators address the limitation we faced in the past, offering solutions beyond mere market orders on AMMs. Traders can now set precise terms for their transactions - an entry or exit price can be set, eliminating the need for constant manual market monitoring. This is made possible through tools like Limit Orders and Stop Loss functions.

Limit Orders open up opportunities to execute swaps at preferred prices. They can predetermine buy or sell orders at specific prices, providing control and the luxury of not having to monitor market fluctuations incessantly. Similarly, Stop Loss orders allow traders to curtail potential losses. When the market reaches a predetermined stop price, it triggers a market order to limit the loss on a specific holding.

Of course, all these are not new, but implementing them in Multichain DEXs, is one step forward to shaping the future of DeFi trading, making it more efficient, predictable, and less stressful.

Multichain vs. SingleChain: A Striking Contrast

The ability to facilitate trades across various blockchain networks is a game-changing feature. It offers enhanced liquidity and a broader range of assets to trade compared to single-chain DEXs. Furthermore, it fosters interoperability, allowing dApps to build upon each other instead of operating as standalone apps. This cross-chain composability unlocks immense potential and is a crucial factor in the future of DeFi. Shall we take a look at some innovators?

Key Players

DexGuru stands out as a leading DEX aggregator that has been making strides since its launch, thanks to its comprehensive offering and continuous efforts for improvement. The platform offers real-time data and analytics across various DEXs and EVM-compatible blockchains.

DexGuru

A major advantage DexGuru offers is enabling cross-chain swaps in collaboration with Li.Fi. This feature allows the seamless exchange of assets across different blockchain networks. Furthermore, they’ve expanded their accessibility and user experience with the launch of mobile applications on both Android and iOS, allowing for DeFi trading on the go.

I noticed several features that make DexGuru user-friendly and practical:

• Their innovative vertical layout design enhances chart readability.

• They offer the ability to download filtered on-chain transactions in a CSV format.

• Custom naming for addresses simplifies your account management.

• Real-time notifications for account activities are possible, keeping you abreast of any changes in their holdings. (Is anyone following those whales?)

On top of these, they’ve integrated with KyberSwap, a leading DEX aggregator, giving users access to more liquidity options and the best possible trade rates. Also, they’ve added support for new chains, including Canto, Arbitrum Nova, and zkSync Era, and have incorporated a straightforward open-source code integration process for adding new EVM-compatible blockchains or AMMs.

This continuous innovation and the platform’s commitment to remaining at the forefront of DeFi trading make DexGuru a noteworthy player to look out for.

dydX Exchange

dYdX launched in 2017 and offers many services, including spot, margin trading, borrowing and lending, and perpetual futures. It appeals to a diverse array of cryptocurrency traders - from beginners to professionals - providing them with more than just basic transactional capabilities.

More specifically, the platform’s recent expansion to layer-2 solutions is a significant development, ushering in several benefits like low fees and faster transaction times. One of the key changes includes a newly structured trading fee system that encourages regular users by offering them zero fees if their monthly trading volume is less than $100,000. In addition, the platform employs ZK-Rollups to move transactions off the Ethereum mainnet, leading to cheaper and faster transactions, which is always welcome.

Here are some distinctive features that set dYdX apart:

• Its commitment to full decentralisation and transparency surpasses many traditional financial services.

• There are no direct gas fees since transactions are processed off-chain.

• The fee structure is friendly towards average traders with smaller trading volumes.

• It provides superior conditions for lending and borrowing services.

• Users can earn interest from lending their assets, with rates based on market supply and demand.

Nevertheless, as a growing platform, dYdX does

face challenges, including a limited asset offering for swaps and dynamic interest rates that could be unfavourable for lenders. Additionally, there are currently a few margin trading pairs available. However, the dYdX team is improving these aspects, planning to add more trading pairs and assets.

dYdX caters to traders whose needs extend beyond basic trading tools. With features like perpetual futures contracts and leverage trading integrated into an efficient Layer 2 solution, the platform offers benefits including:

• Perpetual futures traders can trade with no expiry dates and leverage up to 25X.

• Margin traders can access up to 5X leverage on Ethereum with isolated and cross-margin trading.

The platform’s native token, DYDX, provides added utility. This token was released to the public using a set algorithm that considered both the fees paid and the open interest. In addition, users can add it to a Safety Pool or Liquidity Pool for different yield potentials.

To sum up, dYdX positions itself as a solution for the complex needs of today’s crypto traders. By offering an array of financial services akin to those in the traditional financial industry, but without the constraints of centralisation, dYdX has made itself an appealing platform for a wide range of traders. While it is still developing some features, the platform’s current offerings are likely to satisfy traders looking for more advanced trading options.

1Inch Exchange

1Inch stands out by seamlessly connecting users with multiple DEXs, ensuring the most advantageous trading rates. But that’s not where its prowess ends - it’s a holistic protocol built with innovation and user-centricity, creating a trading experience like no other.

Consider these key aspects that make 1Inch shine:

• 1inch has managed to maintain a pristine track record, free of any security breaches or hacking incidents.

• The user interface is built with the user in mind, striking a balance between functionality and user-friendliness that caters to newcomers and seasoned traders.

• 1Inch has no trading, deposit, withdrawal or hidden fees, making it a cost-effective platform for trading.

• By aggregating order books from various DEXs, 1Inch secures high liquidity and competitive rates while limiting transaction fees.

• It offers a unique approach to transaction costs. CHI GasToken can significantly reduce these costs.

• The recent addition of the Liquidity Protocol opens doors for yield farming opportunities.

The platform’s proprietary token, 1INCH, adds another layer of community engagement. It empowers holders to influence governance decisions like transaction fees and reward adjustments. The same focus on users extends to their innovative Chi Gastoken system, providing considerable savings by dynamically adapting to Ethereum’s gas prices.

The Pathfinder algorithm, an API of Liquidity Protocol V2, skillfully finds the best market prices for token swaps across different protocols. Conclusively, the swap rates are even better compared to a singlechain DEX.

This feature, alongside the commitment to constant upgrades, has powered the surge in 1inch’s transaction volume, especially since 2020. In addition, the 2021 rollout of the Aggregation Protocol v5, designed to cut transaction costs through assembly code optimisation, supports swaps using Uniswap v2 and similar forks. To this date, it has over $250b in total volume across all chains.

Finally, 1Inch’s intuitive dashboard eliminates technical barriers associated with DeFi, allowing realtime investment monitoring from anywhere, globally. It supports DEXs on Ethereum, Binance, and Polygon blockchains. With the introduction of Chi, you can enjoy lower fees, averaging around 40% less than Ethereum fees. In a nutshell, 1inch’s user focus, cost-efficiency, and relentless drive for innovation make it an indispensable choice for traders seeking a streamlined and advantageous trading experience.

Stepping Inside

Taking the first step towards understanding Multichain DEXs, I would like to take you back to a time before their advent. Remember the simplicity of single-chain DEXs? You’ve got a single blockchain, and trades happen seamlessly within that closed ecosystem. It is straightforward and efficient, provided that you are trading within that specific blockchain.

But what happens when you want to trade tokens from different chains?

Well, single-chain DEXs can’t cater to this demand. They are confined to their parent blockchain, limiting their reach and utility. It’s akin to having a telephone that can only call numbers within your local area. Handy, but not exactly groundbreaking. That’s where multichain DEXs, similar to those discussed earlier, come into play. They are like the international calling plans to our local telephony, enabling trade across numerous blockchains, making trading and swapping simple.

How They Operate

Let’s move a little deeper. Multichain DEXs adopt various solutions with smart contracts acting as intermediaries, connecting different blockchains and enabling seamless transfers. They are like your mail courier who delivers your letters across town.

Take, for instance, the concept of Relayers implemented by the Injective Protocol. These are decentralised nodes enabling cross-chain swapping. They hold assets in escrow and facilitate the exchange of assets between traders on different blockchains. Imagine wanting to trade Ethereum for BNB. In a single-chain DEX scenario, this would be impossible.

The Multichain Advantage

Looking beyond, Multichain DEXs offer remarkable advantages like token availability, opening up the playground for traders. No longer are you confined to the token offerings of a single chain. Moreover, you need risk diversification. With access to tokens across multiple blockchains, you can distribute your investments, cushioning the impact of any single blockchain volatility.

I think we learned from our mistakes, furthermore, competition spurs innovation. Multichain DEXs like DexGuru are continuously exploring new features, like limiting orders, providing user control and improving the overall trading experience offering more and more features, attracting more and more users.

Riding the Wave

Look around you. We are smack dab in the middle of a crypto revolution. New projects are sprouting up like wildflowers after a rainstorm. And they are not just popping up on one blockchain. They are springing up everywhere, spreading across multiple chains.

Of course, this isn’t something new, and you must be aware of scams and fake tokens. Cryptocurrencies are now as diverse as the people who use them. If we are going to navigate this sprawling landscape, we need tools that can keep up.

Think about it. You’ve got projects on the Ethereum blockchain, the hotbed of DeFi, each buzzing with promise and potential. Over on BSC, they are cooking up projects faster than you can keep track. Then, you have the smaller but equally important chains: Polygon, Avalanche, etc.

With so many different chains in play, it’s clear that having a one-size-fits-all approach won’t cut it anymore. We need these platforms that can handle this diversity. That’s why Multichain DEXs aren’t just an option. They are a vital component of DeFi.

Security

Security is a paramount concern, and reputable Multichain DEXs ensure it by getting their code audited by various third-party smart-contract auditors or hosting hackathons for bugs or potential vulnerabilities. They also leverage the inherent security of blockchain technology, offering no central point of attack and ensuring immutability, thus barring bad actors from altering transactions and modifying user holdings or records.

With the current state of cross-chain swaps being expensive, time-consuming, technically challenging, and inefficient, Multichain DEXs play a pivotal role in the future of blockchain interactions and interoperability, offering the necessary framework, allowing users to fully tap into DeFi’s potential across multiple blockchains with ease.

The Future of Multichain DEXs

A truly cross-chain DeFi is far from a distant dream; it is already here, becoming more prominent since the emergence of alternative layer-1 blockchains like the Binance chain in 2020. As the space grows, Ethereum may gradually transform into a ‘’chain of proofs,’’ with more individual transactions shifting to other scalable and cost-effective blockchains.

With the emergence of solutions like ZKsync and incentivised liquidity pools on alternative layer-1s, cross-chain transactions would increase significantly. We’ve only tapped the surface so far, but as crypto adoption continues, Multichain DEXs are strategically positioned to tap into this opportunity, and potentially emerge as market leaders.

Final Remarks - My Thoughts

We are witnessing an evolution in the crypto and DeFi, with multichain ecosystems taking the spotlight. They’re not just a means to an end; they’re the glue that binds diverse blockchain communities and connects users across different networks. It’s not just about making transactions smoother – it’s about creating a big, globally connected financial family.

Now, isn’t that exciting?

If you ask me, yes it is. Many challenges lie ahead, but isn’t that true for any cutting-edge tech? With the pace of blockchain innovation, we are witnessing a glimpse of how a truly DeFi future can be. I’m confident that Multichain DEXs are not just a potential game-changer, and they’ll play a crucial role in the future. Of course, it won’t all be smooth sailing, there is no doubt about that. But isn’t the path to innovation always a bit winding? From where I stand, we’re on the right track. And I can’t wait to see where it leads us.

Unravelling the Mystery of NFTs: A Deep Dive into the World of NonFungible Tokens

written by Lisa

In recent years, a new digital phenomenon has captured the attention of artists, collectors, and investors alike - Non-Fungible Tokens (NFTs). These unique digital assets have revolutionised the art and collectibles industry, offering a novel way to prove ownership and authenticity in the digital realm. In this article, we will take a deep dive into the world of NFTs, exploring their definition, benefits, challenges, and potential future implications.

What are NFTs?

I like to think of them as Digital Pokémon cards.

The sort-after collectibles, Pokémon cards, have made their way into the realm of NFTs, BUT there’s just one problem, the ones that have surfaced so far are not licenced, and it seems may not be worth the crypto people have unwittingly paid for them.

All is not lost, The Pokémon Company has expressed its interest in recruiting an individual with specialised knowledge in Web3 technologies, particularly non-fungible tokens (NFTs). As the Japanese company responsible for the largest media franchise globally, it has previously refrained from embracing blockchain-based games. However, a recent job listing on its official website suggests that this stance may be subject to change. The listing indicates a potential shift in the company’s strategy, signalling a possible exploration of NFTs and their integration into their existing ecosystem. And here at The MOON MAG, we are EXCITED!!!

SO AGAIN… WHAT ARE NFTS?

NFTs, short for non-fungible tokens, represent digital assets that provide proof of ownership and authenticity for individual items or content. Unlike cryptocurrencies like Bitcoin or Ethereum, which are fungible and interchangeable, NFTs are one-of-a-kind and indivisible. Each NFT carries a distinct value and cannot be exchanged on a one-to-one basis like traditional currencies. This uniqueness and scarcity contribute to the allure and potential of NFTs in various industries.

Source: https://en.wikipedia.org/wiki/Fungibility

The Rise of NFTs in the Art World: One of the most notable applications of NFTs is in the art world. Artists can now tokenise their digital creations, turning them into one-ofa-kind assets that can be bought, sold, and traded on various online marketplaces.

NFTs provide artists with a new revenue stream and allow collectors to own exclusive digital artworks. The concept of digital scarcity, made possible by blockchain technology, has breathed new life into the art market, sparking a global conversation about the value of digital art.

Back in April of 2021, The Fungible Collection, a groundbreaking digital art exhibition curated by artist Pak, took place. This exceptional collection was released in partnership with renowned auction house Sotheby’s exclusively on Nifty Gateway, a leading marketplace dedicated to the trading and auctioning of non-fungible tokens (NFTs). The highly-anticipated sale of The Fungible Collection generated remarkable results, accumulating a staggering total of $16,825,999 USD in sales during the specified period. This remarkable achievement highlights the growing significance and popularity of NFTs in the contemporary art market. But then the market crashed…

Well, they still have the art.

Makes me wonder… How much can I buy a Beeple for now? At the height of the market, this image below sold for a cool $69 MILLION DOLLARS! It was the talk of the NFT Community and sent prices on art and collections through the roof; every celebrity needed the latest digital accessory!

Beeple’s “Everydays: The First 5000 Days”: In March 2021, the digital artist Mike Winkelmann, known as Beeple, sold a digital artwork titled “Everydays: The First 5000 Days” as an NFT at a historic auction by Christie’s. The artwork is a collage of his everyday drawings created over 13 years. It’s massive $69.3 million, solidified its place as one of the most valuable NFT art pieces to date.

Benefits and Challenges of NFTs: NFTs offer several advantages to both creators and collectors. For artists, NFTs provide a direct connection to their audience, allowing them to bypass traditional gatekeepers. Artists can also earn royalties from secondary sales, ensuring they continue to benefit financially even as the artwork changes hands. Collectors, on the other hand, gain verifiable proof of ownership and the ability to showcase their digital collections to a global audience.

However, NFTs also face certain challenges. Environmental concerns related to the energy consumption of blockchain networks have raised questions about the sustainability of NFTs.

OK… This is probably a topic you shouldn’t get me started on, so I will try to keep this section brief.

One prevalent myth surrounding NFTs is the belief that they have a disproportionately high energy consumption compared to other digital assets. While it is true that NFTs rely on blockchain technology, which can be energy-intensive, it is essential to understand the nuances of this issue.

Firstly, it is important to note that not all blockchains have the same energy requirements. While some blockchains, like Bitcoin, employ a proof-of-work consensus algorithm that demands substantial computational power, other blockchains, such as Ethereum, are transitioning to more energy-efficient alternatives like proof-of-stake. This shift aims to reduce the “carbon footprint associated” (a governmentderived money-making scheme) with blockchain operations.

Furthermore, its crucial to consider the broader context of energy consumption. Many industries, including traditional banking, data centres, and even everyday internet usage, consume significant amounts of energy. Comparatively, the energy consumption of NFTs is a fraction of the energy expended by these industries. While improvements can and should be made to enhance the sustainability of blockchain networks, it is important not to single out NFTs as the sole contributor to energy concerns.

To gain a comprehensive understanding of the environmental impact of NFTs, it is necessary to consider the entire lifecycle of traditional physical art as well. The production, transportation, and storage of physical art also contribute to carbon emissions and environmental degradation.

NFTs offer the potential to reduce some of these environmental burdens by providing a digital alternative.

Ultimately, the environmental concerns surrounding NFTs should not be disregarded, and efforts to mitigate their impact are vital. However, it is essential to approach the discussion with accurate information, understanding that energy consumption is a complex issue affecting various industries. By promoting sustainable practices and supporting ongoing efforts to improve blockchain technology, we can work towards a more environmentally conscious future for NFTs and the digital art ecosystem as a whole.

Ok… I’ll move on now, I have that out of my system

As I touched on earlier in this article, issues related to copyright infringement and intellectual property rights have emerged as the market expands rapidly. Regulators and industry participants are actively working to address these challenges and find solutions that protect both creators and collectors.

BUT IT TAKES TIME… until then, we need to understand the source creator’s data to know real from fake.

Here are a few projects I really like, and I’ll explain why for each one.

CryptoPunks

CryptoPunks is one of the earliest and most iconic NFT projects. Created by Larva Labs, CryptoPunks consists of 10,000 unique 24x24 pixel art characters, each with distinct attributes. They were among the first NFTs on the Ethereum blockchain and have become highly sought after, with some rare Punks selling for millions of dollars.

It gets my tick!

The Cool Cats NFT collection, starting with a Blue Cat as a comic character, has emerged as one of the most renowned projects in its field. Beyond NFT collectibles, the brand encompasses a wide range of offerings, including cartoons, games, and physical merchandise, adding substantial value.

The collection consists of 9,999 unique digital creations on the Ethereum blockchain, with each Cool Cat NFT featuring a random combination of attire, expressions, and background colours. The rising popularity of Cool Cats NFTs is evident through their impressive sales and consistent presence among the top-selling NFT collections on platforms like OpenSea. The project’s community-centric approach is embodied by the Cooltopia ecosystem, which fosters engagement, community events, and collaborations. Additionally, the introduction of Cool Pets NFTs complements the Cool Cats collection and expands its possibilities. The $MILK token plays a significant role within the Cool Cats ecosystem, adding interactivity and enhancing the appeal of the brand and its collectibles. Looking to the future, the Cool Cats team plans to expand beyond Ethereum, introduce full-body avatars, and explore partnerships and collaborations to elevate the brand’s reach further. With a vibrant community and a commitment to continuous growth, Cool Cats aims to establish itself as a blue-chip NFT project.

It gets my tick!

NBA Top Shot - This one is almost BEAR PROOF!

NBA Top Shot, developed by Dapper Labs, is an officially licensed blockchain-based platform that offers digital collectibles in the form of “Moments” from NBA games. These Moments are short video clips capturing highlights and significant plays from basketball games. NBA Top Shot gained massive popularity, attracting a large user base and generating millions of dollars in transactions, further boosting the mainstream adoption of NFTs.

In April 2022, during a period of significant decline in the crypto asset market, NBA Top Shot achieved a remarkable milestone by surpassing $1 billion in sales. This accomplishment stands as a testament to the platform’s enduring popularity and the growing acceptance of NFTs as valuable digital collectibles. Despite the challenges faced by the broader cryptocurrency industry at the time, NBA Top Shot managed to carve its own success story, capturing the attention of a wide audience and cementing its position as a prominent player in the NFT space.

It gets my tick!

An NFT project that streamlines ownership and facilitates the transfer and sale of stakes in films has the potential to revolutionise film financing. Such a model would enable investors and supporters to easily buy, sell, and trade their ownership shares, creating a more liquid and inclusive market. By democratising film financing, NFTs could attract a broader range of investors and promote the funding of fresh and original stories.

However, legal and regulatory considerations must be taken into account when transferring ownership stakes in films. COINRUNNERSMOVIE.COM has implemented a successful model that addresses these concerns by integrating blockchain technology and NFT ownership, providing liquidity, flexibility, and financial stability to investors.

This NFT funding model offers an alternative to traditional methods such as equity financing, debt financing, and financial assistance programs. COINRUNNERS has developed the Recoupment Waterfall process, where revenue from the film is collected and distributed to NFT holders based on their ownership shares. Owning specific sets of NFTs can unlock additional perks and incentives.

Compared to traditional crowdfunding, NFT equity film funding provides investors with direct ownership shares and the potential for financial returns.

It definitely gets my tick!

The Future of NFTs: The future of NFTs is filled with potential. Beyond art, NFTs can be applied to various industries, including gaming, music, virtual real estate, MOVIES (See my article in the previous issue) and even identity verification. The concept of tokenising real-world assets and creating digital representations of physical objects holds great promise. As technology evolves and more people embrace the digital realm, NFTs could become an integral part of our everyday lives.

While challenges persist, the potential for NFTs to reshape industries and empower creators is undeniable. As we continue to unravel the mysteries of NFTs, we embark on a journey that merges the worlds of art, technology, and innovation.

And I’m excited!

Why the UK (not USA) Might be a Safer Option for Crypto HODLers in 2023

written by Ibrahim Birima

Introduction The Crypto Boom, HODLing, and Why Do It?

Over the past ten years, cryptocurrency has had an unprecedented surge in acceptance and popularity, altering the financial landscape and capturing the interest of investors worldwide. It’s become so famous that Binance, a “crypto giant”, has just recently been sued for “operating illegally” by the Securities and Exchange Commission (SEC), which has caused a crypto market crash that is yet to recover fully. That sucks, and now more people are looking for safe havens to protect and increase their cryptocurrency holdings as digital assets continue to acquire widespread acceptance and criticism. This article will examine why crypto HODLers in 2023 might find that the United Kingdom (UK) is a safer alternative than the United States (USA).

“HODLing” is the practice an investor does when they purchase a cryptocurrency in the hope that its value will rise significantly. Investors must find jurisdictions that provide stability, advantageous legislation and investor protection due to the volatility of the crypto market. And although both the UK and the USA are significant players in the cryptocurrency industry, the former may be a safer option for crypto HODLers in 2023.

This article identifies the elements that make the UK a desirable location for cryptocurrency investors seeking stability and growth by analyzing the regulatory landscape/environment, taxation policies, investor protection measures, the benefits of the UK’s banking system and the effects of Brexit. This should give you the knowledge you need to make wise decisions about cryptocurrency investments.

The Regulatory Landscape: UK vs USA

Overview of Cryptocurrency Regulations in the UK

The United Kingdom has taken a proactive stance regarding regulating the cryptocurrency sector, looking to balance between encouraging innovation and protecting investors. The UK Financial Conduct Authority (FCA) has led in developing a robust regulatory environment that promotes accountability and transparency in the cryptocurrency industry. Clarity about the classification of cryptocurrencies, anti-money laundering (AML) controls and customer protection criteria is provided by the FCA’s advice.

Comparison of UK and USA Regulatory Approaches

In contrast, the regulatory environment in the USA has been more fragmented, with various agencies claiming jurisdiction over cryptocurrencies. Aspects of the cryptocurrency sector are heavily regulated by the SEC, the Commodity Futures Trading Commission (CFTC) and the Internal Revenue Service (IRS). For firms, HODLers and investors alike, lacking a comprehensive federal regulatory framework has created uncertainty and difficulties.

Benefits of the UK’s Regulatory Framework for Crypto HODLers

For crypto HODLers in 2023, the regulatory environment in the UK has significant advantages. First, the FCA’s unambiguous guidance gives investors peace of mind as they navigate the crypto world. They can grasp the regulatory requirements and ramifications of different tokens by classifying them as security or utility tokens. There is also an emphasis on the Know Your Customer (KYC) and Customer Due Diligence (CDD) practices which can limit and prevent illegal activity.

Customer protection regulations established by the FCA, such as those governing the custody/protection of assets, also enhance the security of cryptocurrency services offered in the country. These elements add to the UK’s allure as a safer option for crypto HOLDlers in 2023.

Clarity on Taxation Policies

Understanding Taxation Policies for Cryptocurrency in the UK

Tax regulations around them can dramatically impact cryptocurrency ventures’ profitability and legal compliance. Her Majesty’s Revenue and Customs (HMRC) in the United Kingdom has published thorough guidance on the taxation of cryptocurrencies. They advise that cryptocurrencies are often classified as assets rather than money for tax purposes.

HMRC distinguishes between people who invest in cryptocurrency (HODLers) and those who carry out trading operations. Tax obligations for HODLers often appear when crypto assets are sold, traded, or used to pay for goods and services. To ensure compliance and make wise judgments, UK crypto HODLers in 2023 must be aware of these taxation rules.

Potential Advantages of the UK’s Taxation System for HODLers

Anyone who invests in crypto may qualify for capital gains tax (CGT) treatment. This means that depending on the individual’s income level, any profits from the sale of crypto assets may be subject to CGT, with tax rates ranging from 10-20 per cent. A noteworthy benefit is the availability of the yearly tax-free amount known as the “CGT allowance”. A crypto HODLer can realize capital gains up to the existing limit of £12,300 (2021/2022 tax year) without being subject to any tax obligations. For someone who owns a small amount of crypto, this offers flexibility and the possibility of tax savings.

The UK’s tax code also allows the offset of capital losses and gains. The taxable profits from other investments, including cryptocurrencies, can be reduced if a HODLer incurs losses from selling specific crypto assets. This provision can minimize tax obligations whilst enhancing overall tax effectiveness.

Analysis of Tax Implications for USA Crypto Investors

Tax ramifications in the United States may be more complicated than in the UK. Cryptocurrencies are treated as property by the Internal Revenue Service (IRS), which means that capital gains tax laws apply to them. A crypto HODLer in the US has to record and pay taxes on capital gains from the sale/exchange of their holdings. And although there has been continuous discussion of the IRS’s guidelines addressing particular features of cryptocurrency taxation like airdrops and hard forks, this lack of clarity may provide difficulties.

Also, since no explicit tax-free allowance for capital gains under the USA tax code exists, even a modest earning from your cryptocurrency investments may be liable to taxation. The lack of offsetting capital losses against capital gains may also limit the possibilities for tax planning accessible to USA HODLers.

Investor Protection and Security

The FCA’s Role in Safeguarding Crypto Investors

The FCA in the UK is essential in assuring the safety of cryptocurrency investors and HODLers. It regulates the crypto enterprises whilst reducing risks related to market manipulation and financial crime by forcing crypto companies to adhere to strict regulations and standards.

The FCA supervises cryptocurrency service providers’ licensing and registration requirements. Establishing a regulated environment allows investors to distinguish between respectable and complying businesses and possibly fraudulent enterprises. The governmental control prevents investors from failing for Ponzi schemes and other scams common in the crypto industry. Perhaps the FTX saga wouldn’t have happened so quickly had the company been operating from the UK.

Evaluating the Consumer Protection and Security Measures in the USA and UK

The FCA requires a cryptocurrency business to implement Anti-Money Laundering (AML) systems; it also enforces stringent guidelines for the custody and protection of assets held by cryptocurrency service providers. This and the KYC systems help stop investors’ cryptocurrency holdings from being stolen, improperly used or lost. The UK gives crypto investors certainty and enhances the ecosystem’s overall security by holding cryptocurrency companies responsible for the security of consumer assets.

Security precautions for crypto investors in the USA vary between platforms and service providers. While some organizations prioritize strong security measures, others may not do enough to adequately protect investors’ assets; this exposes investors to phishing scams and hacking attempts. The lack of a comprehensive regulatory framework for cryptocurrencies in the USA means that industry-wide standards for investor protection may not exist. Also, the lack of a unified federal strategy has resulted in potential weaknesses in security measures even though some states like Wyoming have established some rules to aid and protect investors - an example is the bill defining what “utility tokens” are.

Moreover, the lack of necessary regulatory standards in the USA has created a lack of transparency and responsibility. Investors are exposed to more risks because it is harder to evaluate the level of security offered by various platforms and service providers. The UK becomes instantly desirable for any crypto investor HODLing in 2023 because of the investor protection and security measures that foster confidence in the integrity of the UK’s crypto ecosystem.

Cryptocurrency-Bank relationships

The UK banking system offers crypto HODLers in 2023 a considerable edge due to its crypto-friendly banks and more convenient access to banking services. American crypto HODLers may encounter significant obstacles when trying to obtain banking services. Traditional banks in the USA are generally reluctant to interact with the crypto business. Hence, getting and keeping bank accounts for cryptocurrency-related activities can be challenging in the USA. Because of a lack of regulatory clarity, some banks may refuse applications or cancel accounts of customers engaged in cryptocurrency transactions. A popular American “crypto bank”, Silvergate Bank, interestingly worked with traditional banks like Signature Bank for a while before its untimely liquidation; some attribute this to the general lack of support from banks in the USA.

Conclusion

The UK stands out as a safer option than the USA for crypto HODLers in 2023. And although the effects of Brexit on the crypto market may have created uncertainty and the possibility of access restrictions to the European market and crypto investors, Brexit has allowed the UK to establish itself as a hub for blockchain and cryptocurrency innovation worldwide. The UK may draw businesses, talent, and investment worldwide if it can enact beneficial policies and support efforts, enhancing its position as a top location for cryptorelated activity.