The Week: Binance Announces Futures Testnets, Bakkt Plans to Open up Crypto Deposits

Binance annoucnes the launch of two Binance Futures Testnet platforms while Facebook has reportedly hired a lobbying firm to start appeasing lawmakers’ concerns regarding its upcoming cryptocurrency Libra, and the ICE’s crypto venture Bakkt is set to open up deposits next week, ahead of the futures trading launch. Over 2,000 XRP investors signed a petition asking Ripple to stop selling its holdings, and the CEO responded. Finally, Craig Wright was ordered to pay 500,000 BTC to the Kleiman estate.

Binance Announces the Launch of Two Binance Futures Testnet Platforms

On Monday (September 2), Binance announced the launch of two Binance Futures Testnet Platforms.

On August 28, Changpeng Zhao (aka "CZ"), Co-Founder and CEO of Binance, explained during an AMA (Ask Me Anything) that Binance had invested in two futures platforms: one they bought and one they built themselves (with some outside help). He explained that "both of them are kind of ready," and that Binance is trying to decide which one to release. He noted, however, that it is possible that Binance will release both since "they are slightly different products.” In an article published to the Binance website, the Binance team said they wanted to give Binance users "the freedom to choose," and that they were going to give away 10,000 BNB in total to users "that participate in each Futures Testnet Platform." Furthermore, users that vote for the winning platform will also get a 50% discount on trading fees on the "official" Binance Futures platform for one month.

Facebook Hires Lobbying Firm to Push Libra

Facebook has started to do something about lawmakers ‘concerns surrounding its upcoming cryptocurrency Libra other than say it will comply with regulations. The social media giant hired a lobbying firm, FS Vector LLC, to support its cryptocurrency. The firm has John Collins, who was previously head of policy at coinbase and led the first congressional exploration into cryptocurrencies, as lead lobbyist.

Bakkt Announces Clients Will Soon Be Able to Start Depositing Bitcoin

The Intercontinental Exchange’s venture into the cryptocurrency space, Bakkt, has announced users will be able to start depositing funds on the Bakkt Warehouse beginning September 6. Bakkt Warehouse is a part of the Bakkt Trust company, which enforces the same security precautions as the New York Stock Exchange (NYSE).

XRP Investors Ask Ripple to Stop Selling, CEO Responds

This week XRP investors signed en masse an online petition urging Ripple to stop selling the XRP tokens it holds, claiming the company was at least partially responsible for the cryptocurrency’s poor price performance so far this year. Ripple’s CEO, Brad Garlinghouse, soon defended Ripple’s XRP sales arguing the sales help expand the cryptocurrency’s utility and build the Ripple network. Moreover, Garlinghouse stated Ripple decreased its sales volume quarter on quarter.

Craig Wright Ordered to Pay Kleiman Estate 500,000 Bitcoin

Self-proclaimed Satoshi Nakamoto Craig Wright made headlines after it was revealed a Florida court ordered him to hand over 500,00 bitcoins and intellectual property rights to the estate of his late business partner David Kleiman. Judge Bruce Reinhart rejected Wright’s testimony, and found he perjured himself by presenting the court with falsified documents.

The Long Take

Exchanges and DeFi Make Bitcoin and Other Cryptos an Attractive Investment

Cryptocurrency exchanges offering their users lending services and decentralized financial applications letting users lend their tokens out to gain interest on their cryptocurrency holdings are helping cryptocurrencies become an attractive investment.

There are an estimated $15 trillion in negative-yielding debt in the world right now, which means investors are lending governments money, while paying them to do so and barely reaping any rewards from it.

This year Austria’s government issued a 100-year bond with a yield of 1.2% - which doesn’t even keep up with inflation. It’s shocking to think investors would agree to lend the Austrian government money for a whole century, taking into account little over 100 years ago the Austro-Hungarian empire was still around.

This has seen various investors turn to equities and help them reach insane valuations. So much so that companies with less-than-stellar reputations are now turning at insanely high valuations. Such is the case of WeWork, which is looking t a $47 billion initial public offering putting it trading at 26 times revenue.

The valuation itself may seem off if we consider Amazon trades at around four times its revenue, but it gets worst: WeWork never turned a profit nor is it expecting to do so in the near future, and its CEO Adam Neuman leases it real estate to lease – the company itself owns no properties. In the IPO Adam is issuing non-voting shares, keeping him in control of the firm.

Poor interest rates, negative-yielding debt, equities becoming overvalued, and economic uncertainty caused by the U.S.-China trade war and the looming threat of Brexit have put investors on edge, so much so that since the S&P 500 hit 3,000 earlier this year it never got back there, and has been rather volatile since.

Similarly gold, the safe haven with a 5,000 year history of being a secure asset, has surged this year and seems to be showing no signs of slowing down.

That being said it may be wise not to put all of our eggs into one basket and diversify – investing in the cryptocurrency space and what some are calling “gold 2.0,” bitcoin. In the cryptocurrency space it’s possible to earn interest on holdings by lending through decentralized financial applications like Compound, or on cryptocurrency exchanges offering margin trading like Poloniex and Binance.

In some cases the APR can be as high as 15% on centralized exchanges for certain cryptocurrencies. On DeFI protocols the rate has risen to over 10% in numerous occasions. It’s worth noting there are various risks in investing in these products – in exchanges you don’t control your private keys, while dapps are written by humans and may have security vulnerabilities.

Tweets of the Week

Pantera Capital explaining why it may be a good idea to invest in Bitcoin

Ripple CEO Brag Garlinghouse responding to controversy surrounding XRP sales

Messari co-founder Dan McArdle points out five years ago Hal Finney started supporting bitcoin, helping the cryptocurrency become more than a dream that didn’t come true.

Overstock’s blockchain venture Medici Ventures reacts on social media after the resignation of the firm’s CEO Patrick Byrne

 

Ethereum's Top DEX Announces Update Powered by ‘Unbounded’ Scaling Solution

IDEX, the top decentralized cryptocurrency exchange for trading ERC-20 tokens on the Ethereum blockchain, has announced a new update powered by an ‘unbounded’ scaling solution called Optimized Optimistic Rollup (O2R).

The scaling solution is made possible by the upcoming Istanbul hard fork, which is expected to take place over the weekend, and brings six Ethereum Improvement Proposals (EIPs). One of these is EIP 2028, which reduces the gas fee for requesting call data from 68 gas per byte to 16 gas per byte. Calldata, CoinDesk reports, is information broadcast on the ETH state necessary for creating specific smart contracts.

These include smart contracts to bundle on-chain transaction off-chain. Aurora Labs, the company behind IDEX, sees Istanbul as a potential way to lower operating costs while processing more transactions. Alex Wearn, IDEX’s co-founder and CEO, said in a press release:

We designed O2R as a way to solve for Ethereum’s scaling challenges today by offering an alternative system that gives businesses a platform to scale to their needs. For IDEX, this 2.0 release gives traders what they want most—the performance and scalability of a centralized platform combined with the security of a DEX

The release notes each settlement transaction processed using the Optimized Optimistic Rollup solution will consume less gas than a single transaction on the IDEX 1.0 exchange, allowing for significant savings on gas fees. A demo version of the IDEX 2.0 trading platform is now available for traders, and comes with a trading competition that the exchange claims will be distributing over $200,000 in prizes.

It’s worth noting that according to Etherscan data, IDEX was responsible for nearly 28% of all transactions conducted on decentralized exchanges on the Ethereum blockchain over the last 30-day period. Uniswap came in first place with 28.9% of transactions, with Kyber Network coming in third with 17%

Decentralized Exchanges

Decentralized trading platforms are a growing trend in the cryptocurrency space. While the first prominent decentralized exchanges were on the Ethereum blockchain, there are now some available on various blockchains, allowing users to trade directly from their wallets.

Allowing users to trade directly from their wallets means there won’t be a risk of losing funds if a centralized platform gets hacked. This has long attracted users, so much so even decentralized exchanges have launched decentralized trading platforms.

These include controversial South Korean trading platform Bithumb, and its Bithumb DEX, popular exchange Binance and its DEX, Poloniex and its TRON-focused DEX launched shortly after it spun out of Circle, and platforms like Waves, which is partly known for its DEX.

As CryptoGlobe reported, OKEx has also announced that the development of its own blockchain, OKChain, is in its final testing phase. OKChain is going to be used to support the unbanked by “providing them basic financial services.” The first decentralized application on the network will be a decentralized trading platform, OKDEX.

OKB, OKEx’s native token, is set to be equipped with more use cases in different fields, including cybersecurity, finance, lifestyle services, and more.

Featured image via Pixabay.