Deflationary tokens are a bit of an odd breed in the broader cryptocurrency industry. They are designed to not only reduce the amount of tokens in circulation, but also bring more value to the asset. When deflationary tokens are coupled with a viable trading platform, interesting things are bound to happen.
The Concept of Burning Tokens
Until recently, there was no effective way to reduce the supply of a crypto asset. Although it can be done by sending excess coins to a “burner” address, the entire process remains relatively centralized. A key example is Binance Coin. The Binance exchange will burn 20% of the platform’s net revenue in BNB every quarter.
While this approach does work, nothing prevents the company from not fulfilling this obligation in the future. It is this particular aspect that may cause some friction along the way. Thankfully, there are ways to bypass these aspects by introducing deflationary tokens.
What is a Deflationary Token?
As the name suggests, a deflationary will see its available supply reduce automatically. There is no external intervention required, although this approach may seem somewhat extreme. It all depends on how the token is coded and what its developers are trying to achieve.
The introduction of BOMB ensured that 1% of the tokens used in every transaction would be burned in the process. This ensures that no tokens will exist in less than 15 years from now. Does that make the token valuable? Sadly, no, as many people don’t want to invest in something that may not be around for much longer.
Void, another deflationary token, took this concept one step further. Rather than burning 1% of the transaction amount, it destroys 3% of every transfer. It has a higher supply than BOMB, ensuring the reduction rate is warranted. Additionally, the token provides staking support to offset the burning aspect a bit. What makes this deflationary token stand out is how it has a native application focused on gaming.
The approach by NUKE is a bit different from both of the projects mentioned earlier. NUKE Will stop burning coins after a while to ensure some supply remains. Its developers also want to introduce a DEX and dApps to bring move value to the deflationary token. It is evident that any project exploring this approach will need real world cases to be of interest to potential investors.
An Overview of the AAX Ecosystem
Building a new deflationary token without having a use for it won’t serve any purpose. In the case of AAX, its native AAB token is linked closely to the platform’s trading ecosystem and features.
On the AAX platform, it is possible to explore many different trading vehicles. Whether one wants to explore spot pairs or crypto derivatives, both options are available. More importantly, these trades can be executed with high leverage, which increases the potential for future profits. The AAX platform also lets users buy Bitcoin through fiat currencies, including CNY, USD, and HKD.
Every month, the trading listings will be optimised. This adds a unique angle to AAX, and ensures users will keep coming back to explore all of the different options. The cryptocurrency market provides exposure to many types of assets and tokens. Rotating the available offerings makes a lot of sense from this point of view.
Ongoing Platform Growth
Global interest in cryptocurrency derivatives has picked up significantly in 2020. AAX is one of the players to keep an eye on in this particular department. Its BTC/USDT futures trading volume has risen above $38 million worth of USDT on a daily basis. This further confirms that traders are more than willing to be exposed to Bitcoin. The team has confirmed that more contracts will be added in the near future.
As far as the futures trading goes, AAX provides the lowest fees in the industry today. Current fees are 0.02% for both maker and taker across all of the different contracts for users to explore. Spot trading fees are also very competitive, as they start out at 0.06% for makers and 0.1% for takers, Depending on the overall trading volume generated by a user, the fees will decline accordingly.
Can AAB Outshine the Competition?
On the surface, AAB is very different from other deflationary tokens. Its supply is shrinking, as there is a daily token burn. This burn is funded by using 100% of the AAX’s futures revenue. Similar to NUKE, the developers are intent on only reducing part of the supply. Once 50% of the tokens are gone, the daily burns will cease completely.
What’s important here is that AAX is growing rapidly, with higher trading volumes recorded every week, meaning coin burns are also increasing. AAB provides a way for early supporters of the exchange to participate in, drive and benefit from growing the platform.
But other than reducing the supply, there are actual benefits to using AAB. The token provides a trading discount of up to 50% on the native AAX platform. Users can also opt to use AAB for settling all of the trading fees, if they prefer that option. Other benefits include unlocking trading bots and trading signals, as well as increased API access rates, among other things.
There is an extra use case to this token, called AAB Plus. It is a savings service for users to earn returns on their allocated tokens. By depositing tokens, users will accumulate daily rewards,
More specifically, there are three different types of rates to explore. The fixed rate guarantees a 4.5% annual payout. Flexible rate will issue higher rewards to users if the AAB/USDT value on AAX decreases. Last but not least, the hybrid rate is designed to withstand market conditions and yield more AAB rewards.
Deflationary tokens will always have a place in the cryptocurrency space. Those tokens capable of not just reducing their supply, but also provide value as part of a broader ecosystem, may have a better chance at survival. Compared to the likes of BOMB and Void, AAB is approaching the deflationary concept from a different angle.
Being part of the AAX ecosystem has the potential to bring more value to the token. With future improvements to come, there are a few things to look forward to. The roadmap makes mention of adding more indices, quarterly futures, and supporting other assets for collateral for trading. Later on, the AAB token will receive its own futures contracts.
Crypto Market Cap Gained $10 Billion, Bitcoin Eyes $11,000? (Saturday’s Market Watch)
The cryptocurrency market continues to rebound and has added another $10 billion to its market cap since yesterday. Bitcoin trades around $10,700, while some leading altcoins mark serious gains.
Bitcoin Price Trades Around $10,700
Following yesterday’s increase in which Bitcoin topped at $10,800, the primary cryptocurrency retraced to its intraday bottom at about $10,550. However, the bulls intercepted the price dip and drove the asset upwards once again. Just as 2020 goes so far, this Bitcoin spike followed the 1-2% gains seen on Wall Street at the Friday trading session.
The S&P 500 (1.6%), the Dow Jones Industrial Average (1.34%), and the Nasdaq Composite (2.26%) were all deep in the green.
At the time of this writing, BTC has dipped to $10,760 after getting rejected at the first major resistance at $10,790.
As per the analysis, if BTC price breaks above, it could head towards the next resistance at $11,000, followed by $11,200, $11,360, and $11,530. Alternatively, should the asset fall, it could rely on the support levels at $10,580, $10,440, and $10,390, if necessary.
Despite stocks and cryptocurrencies, gold had failed to increase: Recording an intraday high of $1,875, the precious metal dived and closed the session at $1,860.
Altcoins Gain Traction
Some alternative coins lost significant chunks of value lately, but they have been recovering in the past few days. Ethereum has continued its upward movement with another 3% increase to above $350.
Ripple has surged by 5% to $0.243. Bitcoin Cash (1%), Polkadot (3%), Binance Coin (1%), and Litecoin (3%) are also in the green from the top 10. However, Chainlink has outperformed them all by marking an 11% increase. LINK has overtaken BNB and DOT and currently occupies the 6th spot.
As it typically happens, the most volatile price moves come from mid and low-cap alts.
CyberVein leads with a 21% surge. Ren (20.5%), Yearn.Finance (17%), The Midas Touch Gold (14%), DFI.Money (14%), Cardano (11%), Zilliqa (11%), HedgeTrade (10.5%), and Nervos Network (10%) follow.
In total, the cryptocurrency market cap has increased by $10 billion since yesterday. On a 48-hour scale, the metric is up by 8% since its bottom at $319 billion to $344 billion.
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Bitcoin Always Online In Venezuela: Launched The First Satellite Node In Collaboration With Blockstream
Bitcoiners in Venezuela don’t need the internet to send some Satoshis. Today, the crypto payments startup Cryptobuyer announced the successful launch of the first Bitcoin satellite node thanks to a collaboration between Cryptobuyer, Blockstream, and a team led by a crypto enthusiast named Aníbal Garrido.
The initiative allows interacting with the Bitcoin blockchain without the need of an internet connection. A satellite antenna installed in Venezuela is in charge of the communication between the node and the blockchain.
We successfully installed and run a satellite #Bitcoin node in #Venezuela which allows us to be independent of the internet to download messages and validate transactions. Thanks to @Blockstream @adam3us @richardbensberg @anibalcripto for all your support https://t.co/TUb6eG19XP
— Cryptobuyer (@cryptobuyer) September 25, 2020
How the Satellite Node Works
This novel solution allows the Venezuelan node to process information in real-time completely off-line. Thus, the normal functioning of the network in case of connectivity failure (something widespread in the country) is guaranteed. It also facilitates the use of cryptocurrencies in remote places where internet service is scarce, expensive, or even non-existent.
The project works as follows: Blockstream contracts a number of satellites to provide the communication service between the nodes and the blockchain. Cryptobuyer bought the necessary equipment to receive the signal and connect to the satellite, and Anibal Garrido and his team were in charge of assembling the antennas and making the required adjustments.
It’s been a pleasure working with @cryptobuyer and @anibalcripto to launch the first of many #BlockstreamSatellite nodes in #Venezuela, ensuring bitcoiners in the region are always connected to the Bitcoin network! 🛰⛓💻 https://t.co/hzqoR1nACI
— Blockstream (@Blockstream) September 25, 2020
For Alvaro Perez, a software programmer from Valencia City who helped set up the whole infrastructure, the node’s synchronization was an inspiring moment. In statements compiled by Cryptobuyer on an official blog post, the expert says that the operation was a “great achievement.”
“We downloaded the whole Bitcoin blockchain and successfully carried out the first transaction through a Bitcoin satellite node in our country on September 23, from the city of Valencia (…) We received bitcoin through the satellite connection without any internet connection. It was a moment of great achievement.”
The journey is just beginning for Bitcoiners in Venezuela
This would be the first of three antennas that Cryptobuyer plans to deploy to cover the country’s most critical areas. The remaining two will be placed in the country’s capital, Caracas, in the north of Venezuela, and Puerto Ordaz, an industrial city located south of the country.
Later on, they plan to deploy a large number of small devices that will serve as a sort of repeater antenna to create a sizeable mesh-type network that will facilitate transactions in Bitcoin even far away from the primary antenna.
Now there’s no excuse to start using some satoshis in the country. Venezuela keeps proving that it has plenty of reasons to be on the podium of the three countries with the most adoption of Bitcoin around the world.
KuCoin’s CEO: The $150 Million Hack Is “Small” For KuCoin, Insurance Will Cover
In a dedicated live stream, KuCoin’s CEO noted that although why he cannot reveal how much of the company’s total assets were affected during the hack, the stolen fund amount is “small for KuCoin.” The exchange will cover all the losses with its insurance fund.
- The company first noticed the abnormalities at 2:51 AM, Sept 26, when it received an alert from its internal risk-monitoring system. More alerts followed, indicating abnormal transfers from the hot wallet.
- At 3:01 AM, the exchange received an alert about its remaining balance from the monitoring system. Three minutes later, more alerts came in showing abnormal XRP withdrawal, which was followed by another alert that the company’s hot wallet is “running out of balance.”
- Subsequent alerts between 3:05 AM and 3:40 AM showed abnormal BTC withdrawal alongside other tokens.
- While the abnormal withdrawals were ongoing, the company set up an urgent task force and then shut down its wallet servers. However, the shut down did not do much to stop the hackers as the abnormal transfers continued.
- At this point, KuCoin realized that the private keys of its hot wallet had leaked. The company then started moving the remaining balance in its hot wallet to cold storage at 4:20 AM. The process took about 30 minutes to complete.
- Lyu said the exchange would publish the addresses used by the hackers on its official channels. An earlier report on the hack shows that the Ethereum address supposedly used for the operation contained over $150 million in ETH and ERC-20 tokens.
- KuCoin is now in contact and working with the international police, its largest clients, and industry experts for an in-depth investigation into the incident.
- The CEO also said they had asked most crypto exchanges, including Binance, Bitfinex, OKEx, BitMEX, and Houbi Global, to blacklist the hackers’ wallet address and assist with the investigation.
- The crypto community was quick to swing into action to assist KuCoin in its request. Bitfinex CTO Paolo Ardoino said they have already frozen 13 million USDT on EOS that was part of the hack, while Tether froze the 20m USDT on Ethereum in the ETH address used for the hack.
- While trading services are still available, withdrawals and deposits will remain closed until the exchange completes its wallet upgrade.
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