A hacker has stolen 206,809 BNB worth $80 million from Qubit Finance.
The hacker exploited a vulnerability on the protocol’s Ethereum bridge.
The Qubit team has offered a bounty of $250,000 to the hacker in return for the stolen funds.
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Qubit Finance, a DeFi protocol on Binance Smart Chain, was exploited today for $80 million worth of BNB tokens.
Qubit Hit by Hack
Another Binance Smart Chain protocol has been hacked.
An unknown hacker was able to drain $80 million worth of BNB tokens from the Binance Smart Chain lending protocol Qubit Finance.
On 27 Jan., at around 9:36 PM UTC, a hacker exploited a vulnerability on the Qubit Bridge, a cross-chain bridge connected to Ethereum. This bridge lets users deposit WETH from Ethereum mainnet into Qubit’s BSC-based smart contract to mint xETH, which can be used as lending collateral on the protocol.
Due to a critical vulnerability in the bridge’s smart contracts, the hacker was able to mint xETH without depositing any WETH, thereby giving them the ability to take out unlimited leveraged loans from Qubit’s pools.
In a Twitter post announcing the exploit, the team reported that the hacker “minted unlimited xETH to borrow on BSC.”Using the xETH as collateral, the hacker proceeded to siphon 206,809 BNB from Qubit Finance, worth about $80 million at the time. The loot can be seen sitting inthe hacker’s address.
In an on-chain message directed to the hacker, the Qubit team offered a bounty of $250,000 in return for the stolen funds, as per the protocol’s ongoing bug bounty program with the ethical hacking platform Immunefi. In another post, the Qubit team has also tried to contact the hacker to negotiate.
The Qubit Finance exploit appears to be the seventh-largest DeFi protocol hack in terms of the value of stolen funds, as per data from DeFi Yield. Following the hack, the protocol’s Qubit token has dropped 27% over the past 24 hours.
Since the launch of Binance Smart Chain in September 2020, the chain has become infamous for the amount of hacks, exploits and rug pulls that have taken place on it.
In 2021, several DeFi projects on Binance Smart Chain suffered major hacks or exploits. Some of the most severe include Meerkat Finance’s $31 million hack in March 2021, a Uranium Finance exploit that cost protocol users $50 million in April, and the $88 million attack on Venus Finance in May.
Qubit Finance has not yet commented on plans to reimburse or compensate users for funds lost due to the exploit.
Disclosure: At the time of writing, the author of this piece owned ETH and other cryptocurrencies.
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The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
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Binance Smart Chain DeFi Project Hacked for $31 Million
The BNB-BUSD yield farming “Vault 1” of the DeFi application Meerkat finance, a clone of Yearn Finance on Binance Smart Chain, was drained for $31 million this morning. Meerkat Finance…
BSC Protocol Uranium Finance Hacked for $50 Million
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A popular crypto analyst is looking at how several Ethereum (ETH) challengers stack up against the leading smart contract platform.
In a new Q&A session, the host of financial education YouTube channel InvestAnswers tells his 401,000 subscribers that he does not doubt Ethereum remains the dominant force with which all competitors must contend.
“As I always say, Ethereum is the dominant 800-pound gorilla. No ifs, ands, or buts.
Everything runs off Ethereum – but other players are chipping away.”
The analyst cites several reasons why he thinks decentralized finance (DeFi) protocol Terra (LUNA) and smart contract platform Solana (SOL) top the list of significant Ethereum alternatives.
“When you look at the USP, which is unique selling proposition, plus team, plus technology, plus community, Luna and Solana win the day… Those four characteristics are key to evaluating [projects].”
Another area of interest for the InvestAnswers host involves the incentives and momentum surrounding a crypto project. He says layer-1 smart contract platform Avalanche (AVAX) and enterprise-grade DeFi platform Fantom (FTM) both meet these criteria.
“The next two are Avalanche and Fantom. They stand out because of incentives and momentum.
Crypto is all about momentum. You’ve got to follow the heat. Where all the flies go, you’ve go to be…
Fantom has incentives that drive momentum. For example, loan to value (LTV), that’s why the LTV is exploding. You’ve got to look behind the curtain to find out exactly what’s going on.”
Source: InvestAnswers/YouTube
The YouTube personality next looks at multi-chained scaling solution Polygon (MATIC) and decentralized digital asset exchange Binance Smart Chain, powered by Binance Coin (BNB). He thinks these Ethereum competitors might be at risk of falling by the wayside – and each for very different reasons.
“Under threat, you could argue that Polygon could be under threat, not only from… it’s amazing how the whale concentration all feeds in and supports this narrative to some extent.
And Binance Smart Chain because it’s so centralized.”
Last on the list are the wildcards: cross-chain interoperability protocol Polkadot (DOT) and scalable decentralized blockchain platform Cardano (ADA).
“And then you have the wildcards, Polkadot and Cardano. Both had sucky years over the last 12 months.
Cardano did move a little bit today, which is great, but I hope it gets to three bucks quick.”
I
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In yet another concerning development, the prominent blockchain security firm, Peckshield, revealed looking into more than 50 potentially dubious projects on Binance Smart Chain(BSC).
Rug Potentials on Binance Smart Chain
Rug pulls were a frequent occurrence in the crypto space in 2021. In this kind of scam, developers of a DeFi project abandon it unexpectedly and siphon off with user funds. Binance Smart Chain was one of the badly hit DeFi platforms which lured numerous malicious actors since its inception.
In the latest development, Peckshield revealed detecting more than 50 tokens with “rug-potentials” on BSC. The blockchain security company alerted the community that the admins behind the mentioned tokens can potentially mint unlimited tokens, restrict users from selling the coins and even blacklist any accounts.
The tokens at risk, as mentioned on Peckshield’s list, are operated by anonymous teams, and the firm has deemed all the projects as “medium” in terms of severity.
#Scam PeckShield has detected 50+ tokens with rug-potentials. The community may want to be aware before interacting:
· Admin can mint unlimited tokens
· Admin can restrict token selling
· Admin can blacklist any account@bsc_daily #BSC Here is the list:https://t.co/6mBp2HX6Hm pic.twitter.com/fYJAMAPs7H
— PeckShieldAlert (@PeckShieldAlert) January 13, 2022
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Rug Pulls in 2021, What’s Next?
The monumental year of 2021 witnessed rug pulls become one of the most utilized scams of choice. According to a report by the blockchain firm, Chainalysis, these rug pulls accounted for 37% of all scam revenue last year compared to only 1% in 2020.
There are two major reasons why rug pulls became so common. One was the initial hype surrounding the DeFi space and the subsequent FOMO. Next up – the technical skills required to develop tokens and get them listed on exchanges, many of which were done without a proper analysis of the smart contract’s code by a third party.
But this trend may not continue in 2022. Going forward, Chainalysis believes crypto-related crimes may decline as law enforcement’s ability to fight these scams evolves. It recently stated that increased legitimate crypto usage is “far outpacing the growth of criminal usage.”
In fact, the firm noted that illicit activity’s share of crypto transaction volume has never been lower. Its report on the same revealed that “crime is becoming a smaller and smaller part of the cryptocurrency ecosystem.”
The team also mentioned that one positive development against these crimes is the growing “ability of law enforcement to seize illicitly obtained cryptocurrency.” For instance, IRS Criminal Investigation seized more than $3.5 billion worth of cryptocurrency in 2021.
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PeckShield has identified 55 “rug-potentials” on Binance Smart Chain.
The security firm warned that the teams behind the listed tokens could mint unlimited tokens, blacklist accounts, and restrict users from selling.
Rug pulls been a frequent occurrence on Binance Smart Chain in recent months.
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Security firm PeckShield has put out a list of 50 potential scam projects on Binance Smart Chain.
PeckShield Identifies Suspicious BSC Projects
PeckShield has published a list of 55 “rug-potentials” on Binance Smart Chain.
#Scam PeckShield has detected 50+ tokens with rug-potentials. The community may want to be aware before interacting:
· Admin can mint unlimited tokens
· Admin can restrict token selling
· Admin can blacklist any account@bsc_daily #BSC Here is the list:https://t.co/6mBp2HX6Hm pic.twitter.com/fYJAMAPs7H
— PeckShieldAlert (@PeckShieldAlert) January 13, 2022
After analyzing smart contracts of 55 early-stage tokens run by anonymous teams, PeckShield detectedmalicious functions that let administrators mint unlimited tokens, blacklist accounts, and block holders from selling their tokens. As such, it concluded that the projects may execute a so-called “rug pull” on their investors. “Rug pull” is a popular term used to describe crypto exit scams in which teams abandon projects or sell tokens on exchanges and disappear with investors’ funds.
PeckShield listed the projects it had identified in a Thursday tweet. The firm highlighted that the smart contracts for the tokens are designed in such a way that users can buy but not sell their holdings, creating a “honeypot” scenario. Tokens that employ a honeypot mechanism typically rise in value as more investors buy in before they find out that they cannot liquidate their positions. The token creator can then pull the rug and run off with the funds. Several scam projects have adopted a honeypot strategy to steal investors’ funds in recent weeks. In one high-profile case, a project styling itself on the hit Netflix show Squid Game launched a token called SQUID on Binance Smart Chain. It rallied thousands of percent in a few days before plummeting to zero when the team pulled the rug, making off with about $12 million.
PeckShield told Crypto Briefing that it “decided to warn the community earlier rather than later” following a discussion with the team at Binance Smart Chain. Discussing how the listed tokens share common issues, PeckShield explained:
“Each token owner’s authority is too large and most of these tokens have too few sellers. Moreover, when interacting with PancakeSwap, the selling may be restricted.”
The good news is that 54 of the 55 flagged projects do not have active users or value locked on them. One token using the ticker symbol TRUMP has some on-chain activity and about $29,500 in liquidity on PancakeSwap. The TRUMP token has about 271 holders and has recorded a trading volume of $144,860 over the course of last week.
In a separate tweet, PeckShield warned Binance Smart Chain users against trading TRUMP. The post described it as a “high-risk token” because it lets the owner mint unlimited tokens. Crypto Briefing investigated the project and could not source the team’s team, website, or social media channels.
Rug pulls have been a recurring problem for Binance Smart Chain users in recent months. In addition to Squid Game, several other scam projects launched on the network in 2021, resulting in users losing millions of dollars worth of funds. Among the biggest attacks involved TurtleDex and MetaDAO, which respectively stole $2.4 million and $3.2 million from their users.
The trend has continued into 2022, too. The security firm RugDoc reported Wednesday that multiple Binance Smart Chain tokens had “rugged” users after launching Initial DEX Offerings on the network. While Binance Smart Chain has hosted many malicious crypto teams, it’s not the only network that’s seen a wave of rug pulls. As the crypto space has grown, Ethereum has become a hub for similar incidents. Most recently, an anonymous team called EtherWrapped lured Ethereum users in with a fake New Year’s Eve airdrop then pulled the rug. They made off with 30 ETH.
Disclosure: At the time of writing, the author of this piece owned ETH, and other cryptocurrencies.
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The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
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Ethereum Project Airdrops Scam Token, Then Pulls the Rug
A new project called EtherWrapped airdropped a token then executed a rug pull on its community earlier today. EtherWrapped Scams Community Following Airdrop Another rug pull has hit Ethereum’s DeFi…
What is a Crypto Airdrop: Why Projects Airdrop Crypto
Crypto airdrops occur when new tokens are freely distributed to different wallets in order to drive initial growth and build a community. They represent a popular marketing tactic that new projects use to spread…
MetaDAO Makes Off With $3.2M in Rug Pull
A project called MetaDAO has made off with roughly 800 ETH, or $3.2 million, in an apparent rug pull scam perpetrated over the holiday weekend. Holiday Crypto Heist Just ahead…
How a BSC Project Used Netflix’s Squid Game to Scam Investors
The Binance Smart Chain project has plummeted to almost zero in the latest DeFi rug pull on investors. Investors Scammed by Squid Game Token Squid Game, a Binance Smart Chain…
Analysts at global banking giant JPMorgan say that Ethereum (ETH) competitors will challenge the top altcoin’s decentralized finance (DeFi) dominance of the crypto markets this year.
In a recent report, analysts led by JPMorgan managing director Nikolaos Panigirtzoglou say that ETH’s 70% market share of the DeFi space will continue to drop because the blockchain’s sharding upgrade is still at least a year away.
Ethereum’s market share of the DeFi space is already down 30% since January 2021.
“In our mind, this optimistic view about ETH’s dominance is at risk.
This is because the scaling of the Ethereum network, which is necessary for the Ethereum network to maintain its dominance, might arrive too late.”
According to Panigirtzoglou, Ethereum competitors such as Terra (LUNA), Solana (SOL), Avalanche (AVAX), Fantom (FTM), Tron (TRX), layer-2 scaling solution Polygon (MATIC), and the Binance Smart Chain (BSC), powered by Binance Coin (BNB), are gaining ground on the second-largest crypto by market cap in terms of growth via adoption.
Furthermore, some developers may not ever return to ETH after its sharding upgrade is complete, according to the report.
“The relative valuation of Ethereum vs. its competitors has been echoing its declining DeFi share.
The risk for ETH is that by the time sharding is implemented in 2023, competitors’ ecosystems would have grown by so much that activity won’t return en masse to the Ethereum network.
In other words, Ethereum is currently in an intense race to maintain its dominance in the application space with the outcome of that race far from given, in our opinion.”
Ethereum is exchanging hands at $3,111 at time of writing, a 30% decrease from its 30-day high of $4,439.
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The top-five blockchain ecosystems in terms of developers are Ethereum, Polkadot, Cosmos, Solana, and Bitcoin, according to Electric Capital.
Polkadot and Solana have more active development than Ethereum did at similar points in its history.
There’s nothing like a market boom to bring people aboard. After a record 2021 for crypto prices, more developers than ever joined Web3 projects last year.
And according to anew reportfrom early-stage crypto investment firm Electric Capital, several protocol ecosystems are outpacing the largest developer ecosystem out there, Ethereum. “Polkadot, Solana, NEAR, [Binance Smart Chain], Avalanche, and Terra have faster initial ecosystem growth than Ethereum,” the report states.
The metrics it uses to come to this conclusion are the length of days since the first “commit,” or change to the code, and the number of total developers since launch. When measured against Ethereum at a similar stage, those six layer-1 ecosystems have more active developers.
Source: Electric Capital
Solana, Avalanche, BSC, and Terra have all emerged in the past year as new hubs for decentralized finance (DeFi) activity, with their networks accommodating applications for peer-to-peer lending, swaps and other transactions. Their token prices have climbed the charts accordingly. NEAR is also integrating DeFi elements, causing its native coin to hit arecord highthis week. And after several years of work, Polkadotlaunched “parachains”at the end of December, essentially bringing smaller blockchains onto its network.
Electric Capital’s lengthy report includes several elements that put ecosystem growth in perspective, lest someone cries foul that it misrepresents Ethereum’s overall value while puffing up rivals.
First, it admits that “not all commits are created equal” in terms of time spent, and it limits its scope to open-source code repositories, which has the effect of undercounting total developers.
Second, the report slices developer data in multiple ways, including looking at full-time, part-time, and one-time protocol and community developers. (Protocol devs work on the core blockchain while community devs work on the tools and applications on that blockchain.) When looking at only full-time developers (those with at least 10 commits per month), Solana, Polkadot, BSC, and NEAR still rank ahead of Ethereum at comparable stages; Avalanche and Terra do not.
Third, Electric Capital also dives into retention levels across protocols and what makes devs stick around. (Hint: Those joining at the market peak aren’t as likely to stay.) It finds that Ethereum draws the lion’s share of new Web3 developers, averaging between 20 and 25% of the total each month. That equates to over 700 new developers for Ethereum per month, an all-time-high. Moreover, 30% of those developers who started full time on Ethereum projects in 2017 were still around in 2021. Across the entire Web3 space, retention throughthree yearswas 30%—Ethereum has lower rates of attrition.
1/ Time for @ElectricCapital’s Annual Developer Report:https://t.co/aiKIJnwYdm
We analyzed 150m+ repos & xM code commits to produce these 100+ charts.
This was a community effort: 150 people contributed via email and Github! Thank you everyone who helped.
Finally, there’s a tacit recognition that Bitcoin and Ethereum existed in very different market environments than newer entrants such as Solana and Terra. Bull runs attract developers, per Electric Capital’s findings, not the other way around. The success of Bitcoin and Ethereum through previous bull cycles helped prime the larger crypto ecosystem we’re seeing today. Moreover, blockchains such as Avalanche and BSC are clones of Ethereum, which have helped them attract developers familiar with the latter.
In terms of where things stand today—regardless of the blockchain’s age—Ethereum still has the largest developer ecosystem, though Bitcoin has fallen to fifth, behind Polkadot, Cosmos, and Solana.
It’s official, this was Binance Coin’s year. There are no two ways about it, BNB crushed it throughout 2021 and cemented itself as the third more popular coin in the world by market capitalization. Not a small feat, considering the phenomenal year that altcoins had. Several coins had their moment in the sun, capturing capital, headlines, and attention. No one got near Binance Coin, though.
Binance Coin's stellar performance | Source: The Weekly Update
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“Bitcoin may have beaten the stock market in 2021, but it has been left in the dust by other cryptocurrencies. Binance Coin (BNB) is the best performer of the three biggest cryptocurrencies by market cap, with a 1344% gain. The Binance Smart Chain ecosystem has seen massive growth in 2021, taking some market share from Ethereum.”
That’s why they dubbed Binance Coin as “the winner of 2021,” and their point is well taken. However, there’s more to the story. Binance as a company was in hot water for a while there. And their own validators blasted the Binance Smart Chain, saying things like, “There doesn’t appear to be any reasonable testing process in place. Every update appears to make things worse.”
Let’s explore the Binance Coin ecosystem’s tumultuous year.
Big Projects Decided To Operate On The Binance Smart Chain
There’s no denying it. As The Weekly Update says, “Ethereum has lost its indisputable position as the “one and only” smart contract platform.” And Binance has a lot to do with that. A controversial project from the start, the Binance Smart Chain has been dubbed a centralized Ethereum clone. And they have a point. However, even though the Binance team did fork Ethereum’s code, they were always upfront with the direction of the project.
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In BSC’s documentation, the team shamelessly claims that the “Binance Smart Chain uses a consensus model called Proof of Staked Authority (PoSA). (…) This consensus model can support a short block time and low fees, and it only requires 21 validators to run.” Contrast that with the 11.000 nodes that reportedly support the Ethereum ecosystem.
Also,their plan workedand projects flocked to it:
“Binance Smart Chain was developed explicitly to solve Ethereum’s rising gas fees and offers faster, scalable, and cheaper transactions. In the past, several alternative blockchains have tried to become ‘Ethereum Killers’ but couldn’t succeed in capturing new project’s interest. However, Binance Smart Chain is hosting numerous blockchain, Defi, and crypto projects.”
Problems And Connection To The Binance Coin
However, as in Ethereum’s case, success came with scalability problems. A set ofvalidators took to GitHubto raise concerns about the state of the network and how running a complete node’s cost has increased tremendously. “There is no code review, patches are simply committed, in most cases even without a proper description of what they do or what problem they try to solve,” the original poster said.
“I’ve rarely seen something handled so unprofessionally,” the OP accused. “I have many full nodes running there and now all of them are unable to sync. Each of these servers costs me $800 per month (previously only $200), then you told me that I need faster bandwidth and disk which means the cost will keep rising,” a commenter claimed.
What does this have to do with the Binance Coin? Everything. As the native currency of the Binance ecosystem, BNB’s success is tied to the success of the whole network. Binance is still doing amazing, but, can Binance Coin holders count on that to be the case in 2022?
BNB price chart for 12/29/2021 on Binance US | Source: BNB/USD on TradingView.com
Make No Mistake, Binance Coin Won 2021
It was an action-packed year, but Binance Coin rose to the test. Besides the validators uprising, the Binance team took care of theseflash loan hacksand kept BNB’s price rising throughout the year. When CZ himself called forother entrepreneurs to create their own coins, NewsBTCwas the voice of reason:
“Binance is not only the biggest exchange in the world; it also has the most activities, features, things to do. BNB powers all of that. How many coins support that huge of an ecosystem? How many coins have that many use cases? And yes, BNB provides its user with superpowers while in the Binance ecosystem and helps them save money. How many other coins can do something similar?”
Let’s not kid ourselves, the Binance Coin AKA BNB is a unicorn. A one-of-a-kind project that did many things right and rewarded the early believers with a phenomenal year. A 1344% increase in price is not something we see every day. Congratulations to Binance Coin for owning 2021.
Featured Image: Foundry on Pixabay | Charts by TradingView & The Weekly Update
2021 has been one of the most interesting years for blockchain technology and cryptocurrencies, both in terms of adoption and mainstream acceptance. From governments such as El Salvador to large corporations like Tesla, Goldman Sachs, Bank of America and Morgan Stanley, many institutions have made a step toward becoming a part of the ecosystem.
Even so, there were a few issues and events that soured the mood for cryptocurrency investors and the community in general.
SEC’s rejection of VanEck’s spot Bitcoin ETF
Following the United States Security and Exchange Commission’s approval of ProShares’ Bitcoin (BTC) futures exchange-traded fund early in October, Bitcoin rallied to a new all-time high of $68,789.63 on Nov. 10, as per data from Cointelegraph Markets Pro. The ProShares Bitcoin Strategy ETF, which trades under the ticker BITO, had the biggest ever first day of any ETF in terms of natural volume, indicating how highly awaited the launch of a BTC ETF was.
Soon after, on Nov. 12, the financial regulator spoiled the party by rejecting Van Eck’s proposal for a spot Bitcoin ETF, which led the price of the flagship cryptocurrency to start its downward spiral journey.
Jan van Eck, CEO of VanEck, wasn’t pleased with the rejection.
We are disappointed in today’s update from the SEC declining approval of our physical bitcoin ETF. We believe that investors should be able to gain #BTC exposure through a regulated fund and that a non-futures ETF structure is the superior approach. @tyler @gaborgurbacs
— Jan van Eck (@JanvanEck3) November 12, 2021
The bid to get approval from the SEC for a spot ETF has been going on for more than eight years, since July 2013 when Cameron and Tyler Winklevoss tried to launch the “Winklevoss Bitcoin Trust.” Even though such a long time has passed and the narrative around cryptocurrencies has changed, Gary Gensler’s SEC has not yet approved a spot ETF for Bitcoin.
Related:VanEck’s Bitcoin spot ETF shunt solidifies SEC’s outlook on crypto
Eric Balchunas, senior ETF analyst at Bloomberg, opined on the SEC’s rejection. Balchunas has been vocal about the SEC’s rejection of the several spot ETF applications that have been filed. He has become one of the prominent voices tracking new ETF developments surrounding cryptocurrencies like Bitcoin and Ether (ETH).
She (the SEC) is Just Not That Into You (Spot Bitcoin ETF Filings) = my summary of @JSeyff great note today explaining why spot bitcoin hopes are so bleak (unfortunately). The bar SEC sets is so high and so inconsistent one can only conclude they just don’t want to see it happen. pic.twitter.com/7HRDReWF2N
— Eric Balchunas (@EricBalchunas) November 18, 2021
Ethereum network: Gas fees out of control
The Ethereum network underwent a landmark upgrade in 2021: its London hard fork, which put ETH on a deflationary trajectory with Ethereum Improvement Proposal (EIP) 1559. As of the time of writing, 1.244 million ETH has been burned, valued at over $4.96 billion.
Along with the burn mechanism being introduced, Ethereum gas fees also saw a huge spike in light of the increased utilization of decentralized finance (DeFi) protocols on the blockchain and the proliferation of Ethereum-based nonfungible tokens (NFTs) in the cryptoverse. Gas fees continue to cross 100 gwei, even leading up to 2022. “Gwei” is the smallest unit of Ether, equal to 0.000000001 ETH.
The gas fees on the network hit a yearly high of 373.8 gwei on Feb. 23. Even though gas fees seemed to be in control between May and August, there have since then been several instances of spikes that are highly unfavorable, especially for retail investors in the DeFi markets. This has also led to several DeFi protocols and investors choosing alternative blockchain networks, such as Binance Smart Chain, Solana, Polygon, etc.
Say wooooot? #eth #gasfees pic.twitter.com/JdO3j0pgtL
— Ceeeebastian⭕️ (@ceeeebastian) December 18, 2021
In order to address this ongoing issue, Vitalik Buterin, co-founder of Ethereum, has suggested the upgrades EIP 4448 and EIP 4490, which would serve as a temporary fix by resorting to a method known as data sharding, which would cut costs for zk-Rollups on the blockchain.
However, it remains to be seen whether the proposal will pass the governance structure of the network and how effective these upgrades will actually be in reducing gas fees.
Related:London’s impact: Ethereum 2.0’s staking contract becomes largest ETH holder
Solana network: Outage and DDoS attack
Launched in April 2019, Solana has grown rapidly to become one of the leading blockchain networks, with a total value locked (TVL) of almost $12 billion. The network’s native token, SOL, has increased in price by almost 130 times given the current price of around $180. The token hit an all-time high of $260.06 on Nov. 7.
However, on Dec. 4 at 13:46 pm UTC, the Solana network suffered an outage that lasted nearly six hours. The mainnet beta cluster of the network stopped producing blocks at slot 53,180,900, which stopped new transactions from being confirmed on the blockchain. This outage drew criticism from various traders and developers, who took to Twitter to criticize the network.
Scott Lewis, co-founder of DeFi Pulse, was one of the critics, citing Serum’s order book data as evidence of a lack of “real customer orders.”
hey! someone forgot to turn on the “real customer orders that are definitely not a bot” for serum now that solana is back up.
No new trades in the last 2 hours? pic.twitter.com/fCJ6hqCjvn
— Ξ (@scott_lew_is) December 4, 2020
This wasn’t the first outage Solana experienced this year. Back in September, the network suffered a 17-hour outage between Sep. 14 and 15 due to a distributed denial-of-service (DDoS) attack targeted at Grape Protocol’s initial decentralized exchange offering on Sept. 14. During a DDoS attack, a large number of coordinated devices or a botnet congests a network with fake traffic in an attempt to take it offline.
Soon after the second outage on Dec. 4, the network was hit by another DDoS attack on Dec. 9 that temporarily congested the network, although it managed to stay online throughout the attack.
Related:Scalability or stability? Solana network outages show work still needed
Even though the attack was blamed on Solana’s fundamental design and use of its proof-of-history consensus mechanism, the developers still seem to have faith in the network’s potential. Solana co-founder Raj Gokal elaborated on the DDoS attack on Twitter:
if you’re not helping the @solana community focus on those metrics, if you’re lying or perpetuating lies, if you’re competing for the tiara and bouquet in the hater’s ball…
save your tweet threads until you’re ready to do the hard work of scaling crypto.
until then, fuck off.
— Raj Gokalᵍᵐ (@rajgokal) December 12, 2021
In the aftermath of the DDoS attack, Solana’s on-chain development efforts saw a noticeable spike in terms of daily GitHub submissions. In fact, the network surpassed Polkadot and Cardano to become the most developed blockchain network between Nov. 12 and Dec. 13.
Binance Smart Chain network: Security exploits
Binance Smart Chain is the parallel chain to Binance Chain, with both blockchains designed and maintained by the cryptocurrency exchange Binance. BSC was first unveiled in April 2020 and launched soon after in August 2020.
Since then, the network has grown to become the second most widely used blockchain to deploy decentralized applications, after Ethereum. According to DefiLlama, the TVL in DeFi protocols on the network currently stands at nearly $17 billion. The TVL hit an all-time high of $31.72 billion on May 10, at the peak of the previous bull run in the market.
However, the network and the protocols running atop it have been extremely vulnerable to security exploits ever since its launch. Below is a list of some of the DeFi protocols on BSC that have been a victim of security exploits and hacks:
Considering that the list above isn’t exhaustive in nature, it is safe to say that there have been hacks and security breaches leading to losses of hundreds of millions of dollars in the 18 months that the network has been in operation. In addition to these security exploits, there have been several phishing attacks on the PancakeSwap decentralized exchange alongside Cream Finance.
Related:DeFi hacks on Binance Smart Chain rise as TVL and volumes increase
However, the Binance ecosystem is attempting to address this issue in several ways. The latest effort is the introduction of Project Shield, a security audit program that will add an additional layer of protection for users attempting to gain exposure to both BEP-20 and ERC-20 tokens on the Binance exchange.
Plenty to look forward to
Despite these instances and issues leading to disappointments for the crypto community in 2021, it is evident that the growth in digital currency use is higher than ever before.
With innovations like NFTs, GameFi and the Metaverse, the cryptocurrency domain is tapping into the next big thing in the world of art, gaming, music and finance with a single innovation that will change these industries for the better.
The cryptocurrency exchange giant Binance announced the implementation of a new BNB Auto-Burn mechanism.
The aim is to provide greater transparency and predictability to the BNB community.
BNB Auto-Burn is also designed to foster the development of a “healthy blockchain ecosystem” together with the Binance Smart Chain (BSC) and Binance Coin (BNB) communities.
According to the official blog post, the new system, dubbed “BNB Auto-Burn,” will have two characteristics. It will be objective and verifiable. It will not rely on the revenues generated on the Binance’s centralized exchange through the use of the native token.
Instead, it will be automatically adjusted in that the burn amount will be based on BNB’s price. This, in turn, takes into account the supply and demand for the token in addition to the number of blocks produced during a quarter based on on-chain data.
With the introduction of the BNB Auto-Burn, Binance revealed that the next phase in the development of its native tokens and BSC has started.
CryptoPotato had earlier reported about Binance Smart Chain launching its automatic burning mechanism.
After the activation of BEP-95, which is involved with integrating a real-time burning system into its tokenomic structure, a fixed ratio of gas fees accumulated by the validators in the BSC ecosystem will be burned in each block.
The main objective is to ramp up Binance’s burn process while simultaneously decentralizing the network.
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One of Asia’s biggest Venture Capital firms, Chiron Partners, has launched a $50 million ecosystem fund christened the Chiron Terra Fund I (CTI), aimed at supporting innovative projects that are emerging from the Terra blockchain ecosystem.
The firm announced that the CTI will support the projects. In addition, the Fund will involve in decentralized finance (DeFi), non-fungible tokens (NFT), and metaverse related initiatives. The primary motivation behind the massive investment is to reposition Chiron Partners as one of the committed accelerators of developing promising, disruptive, and emerging technologies.
“We’re thrilled to have Chiron Partners join the booming Terra ecosystem as a valuable resource to help equip ecosystem projects and builders with capital, strategic expertise, and other guidance,” says Do Kwon, Co-Founder and CEO of Terraform Labs.
Terra is a high-performing blockchain hinged on using fiat pegged stablecoins to power global payment systems. In a bullish move to support the growth of the innovative projects emerging on the Terra ecosystem, the protocol raised a $150 million fund from renowned venture capitalists back in July to support these projects. These funding models similarly move from competing blockchains, including Avalanche and the Binance Smart Chain, respectively.
Furthermore, Terra recently completed its Columbus-5 upgrade, significantly improving scalability and enhancing network interoperability. From here, as many as 160 projects are on track to make their way to the Terra ecosystem as from Q1 2022.
“The Terra ($LUNA) ecosystem’s growth potential, particularly after the latest Columbus-5 upgrade and announcements on Risk Harbour insurance wrapped protection, is limitless,” said Jake Cormack, Founding Partner and COO of Chiron Partners.
The positivity surrounding the Terra ecosystem is highly reflective in the native digital currency LUNA, which has surged over 13,000% in the Year-to-Date period, according to data from data analytics platform, Coingecko.
