Fireblocks Expands Support For Crypto Derivatives Market With X-Margin
XBTO, LedgerPrime and JST Capital, first Fireblocks customers to successfully trade utilizing X-Margin’s distributed clearing network
NEW YORK, Sept. 8, 2020 /PRNewswire/ — Fireblocks (www.fireblocks.com), an award-winning platform for securing digital assets, announced today that it has expanded support for the crypto derivatives market through a new integration with X-Margin (http://xmargin.io/). Together, X-Margin and Fireblocks allow the trading of derivatives on any asset, using any form of collateral while receiving cross-margin benefits across counterparties. As a distributed clearing network, X-Margin eliminates counterparty risk, while Fireblocks secures collateral and automates settlement with it’s leading digital asset security infrastructure.
“The derivatives market has always been attractive for larger investors, but one of the biggest hurdles they needed to overcome has to do with capital efficiency, custody and security,” said Darshan Vaidya, CEO of X-Margin. “Working with Fireblocks to grow X-Margin’s distributed clearing network is an obvious and natural fit given the number of institutional trading firms actively using Fireblocks. The partnership allows institutional trading firms to cross margin and bilaterally trade derivatives without compromising security.”
Crypto derivatives trading requires users to hold funds on exchanges as collateral so that contracts can be funded, making it a high risk for institutional investors, especially given the number of exchange hacks that have happened over the last year. In Q1 of 2020, crypto derivative exchanges saw more than $2 trillion in trading volume, a 314% increase from the 2019 quarterly average. With the increase in activity, it is critical to provide the necessary security for institutions to feel comfortable using some of the newer and more sophisticated financial instruments that have arrived in crypto this year.
“The Fireblocks/X-Margin integration perfectly combines cross-platform collateralization, risk transfer, and settlements into one comprehensive package that encompasses the whole life cycle of a trade. This has been a crucial infrastructure piece that has evaded the institutional digital asset markets until now,” Shiliang Tang, CIO LedgerPrime.
X-Margin is the first ever zero knowledge cross margin system designed to solve a major pain point in the industry. Derivatives trading firms currently need to post collateral with each venue they trade at, even if they have offsetting positions across them. This is extremely expensive, and it increases custody and operational risks. Starting with bilateral derivatives, X-Margin’s proprietary zero knowledge technology allows users to get the portfolio effects of central clearing without needing a central intermediary to verify positions. Users can net risk across counterparties and automatically settle trades.
“Using both Fireblocks and X-Margin together gives us the ability to scale our derivatives trading business by giving us capital efficiency, counterparty credit protection, and secure settlement,” said Paul Eisma, Head of Trading at XBTO.
As more traditional investors continue to enter the crypto derivatives space, it is important that they are able to operate in a secure environment with no inefficient intermediaries. With over $18B digital assets secured per month by the Fireblocks platform, JST Capital, XBTO and LedgerPrime, are now the first customers to successfully trade custom bilateral derivatives with cross margin, utilizing X-Margin’s distributed clearing network.
Fireblocks is an enterprise-grade platform delivering a secure infrastructure for moving, storing, and issuing digital assets. Fireblocks enables exchanges, custodians, banks, trading desks, and hedge funds to securely scale digital asset operations through the Fireblocks Network and MPC-based Wallet Infrastructure. They have secured the transfer of over $70 billion in digital assets and have a unique insurance policy that covers assets in storage & transit. For more information, please visit www.fireblocks.com.
X-Margin is a distributed clearing solution, enabling trading firms to securely trade across multiple venues and counterparties, netting their risk across them. X-Margin harnesses the power of zero-knowledge proofs and Intel SGX enclaves to be the first ever cross margin and settlement solution for derivatives without a central intermediary. Compared to a central clearing house, distributed clearing is more cost efficient, regulatorily light, and better equipped to scale across different asset classes and venues. For more information, please visit www.xmargin.io.
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How to analyze crypto tokens properly before investing
If you ask people what they know about cryptocurrency, chances are you’ll hear the words Bitcoin (BTC) or blockchain — or even both. However, what many individuals aren’t aware of is that over 5,000 cryptocurrencies exist in the market today. This huge number makes things a little confusing for investors.
With so many options to choose from, the task of choosing one to invest in can be challenging. At the same time, though, there are several potential opportunities for people to get scammed in the crypto space.
You see, some bad actors have designed tokens in a bid to scam people out of their hard-earned money. Whether you choose to move funds transparently or privately, your first priority should be to find authentic crypto assets to invest in.
In this article, we’ve compiled a list of a few precautionary techniques that can help you analyze crypto tokens — whether a utility token or asset token — properly to make a safe choice.
A cryptocurrency or initial coin offering’s white paper mentions the background, strategy, goals, concerns and timeline of the blockchain-related project for successful implementation.
Since white papers are supposed to be detailed, they can be very revealing. The biggest advantage here is that you can find out whether or not a company has a carefully conceived implementation plan of a company in place — something that can be very helpful for a token analysis. Hence, going through white papers can be very useful.
Here’s what a white paper should answer:
Start any crypto or blockchain investment decision by reading the white paper thoroughly, and check if it has any complimentary resources. This can include financial models, SWOT analysis, legal concerns as well as a roadmap for implementation. You’ll also be able to determine the suitability for mass-standardized trading of the tokens.
If a company doesn’t offer a white paper, treat it as a red flag and move on to another one. At the same time, keep in mind that white papers shouldn’t be taken as the holy grail of authenticity either — it’s wholly possible for a fraudulent company to create a convincing white paper. For instance, PlexCoin managed to raise over $15 million with the help of its noteworthy white paper before the U.S. Securities and Exchange Commission shut it down.
The developers and administrative team are a crucial part of the success of any tokens project, which is why you should have an idea about the people who are backing the project. Find out whether anyone has worked on reputable projects before, or are notable members of the blockchain landscape. In addition to this, their qualifications and experience should also be important considerations.
Make sure the token is backed by people who know what they are doing. This will help you move away from companies that prioritize personal profit over ethics.
Seeing this loophole, scammers have started inventing fake founders and biographies for their projects. Sometimes, they may even exploit the personal identities of unaware victims for their benefit as well.
Hence, the best protection against this fraudulent tactic is to do your research, and do it well. Skip tokens whose developers or founders you’re unable to find information about.
Even if you do find profiles, check to see whether the activities match up with the number of followers and likes, and be attentive to other similar nuances.
Finding a great token’s ICO for investment isn’t enough. Sometimes, you may not be allowed to participate because of your jurisdiction. If you do decide to go ahead in such cases, you might end up breaking the law.
To avoid this, you need to make sure that regulators in your country haven’t restricted participation in such tokens. Despite the fact that ICOs are still unregulated, the good news here is that regulators are working on making friendlier rules that can lift most of these restrictions in a good number of regions.
Ask yourself this question before investing in a token: What problem is this token solving, and how is it unique? Verification is crucial when it comes to token analysis, especially if you want to safeguard the security of your investment. People are becoming more aware of the looming online threats in cybersecurity, with the average cost of a data breach currently sitting at around $3.92 million. It’s the same caution that needs to be practiced when determining the utility of a token’s market value.
Plus, investing in blockchain projects that solve a unique problem will also see a higher demand surge, which, in turn, will boost the tradable value of its token. So, if you invest in the ICO of such projects, you’ll be more likely to score a more secure and profitable investment.
All ICOs are dependent on a token or currency system when it comes to crowdfunding facilitation. You should always take a look for token sales figures while the ICO is on, keeping a watch on its progress over time.
In fact, companies and other endeavors consciously make it easy for potential investors to take a look at their system and token sale progress to establish legitimacy. Nowadays, with the growing popularity of cloud-based infrastructure business models, blockchain-as-a-service is also becoming prevalent, which should make transparency even easier.
In other words, there is no reason why a company shouldn’t show you its token sales progress. A company that makes it difficult for anyone to view the progress of its ICO is highly likely to be a scam. Try to avoid such companies at all costs.
Cryptocurrency has shown considerable maturity in terms of providing resilient custodial and noncustodial wallet solutions, but security is still a concern in the space. This is why we recommend working with trusted people whenever possible.
You see, it isn’t possible to scrutinize every project thoroughly. So when you work with and follow trusted people in the cryptocurrency landscape, you can have greater peace of mind. These industry professionals have good knowledge about the blockchain ecosystem and can deliver sound advice as well.
Cryptocurrency and ICO spaces can offer multiple opportunities for investment. The only catch is to have the ability to make sound investment decisions and have done their homework. At the same time, these spaces also have their own share of pitfalls, exposing people to scams and fraud, while even legitimate businesses with poor implementation strategies can cause severe financial loss. Try to stay away from low-liquidity instruments too.
There is, of course, no guarantee that a cryptocurrency or blockchain-related startup will be successful or legitimate, but following our above guidelines can certainly help you reduce the likelihood of getting scammed.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, readers should conduct their own research when making a decision.
The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Sam Bocetta is a freelance journalist specializing in United States diplomacy and national security with an emphasis on technology trends in cyberwarfare, cyberdefense and cryptography. Previously, Sam was a contractor for the U.S. Department of Defense, working in partnership with architects and developers to mitigate controls for vulnerabilities identified across applications.
This European Crypto Exchange Was Just Hacked for $5 Million
In the first crypto exchange hack of this bull market, a European crypto exchange was hacked for around $5 million. Only the exchange’s “hot” wallets were compromised per their report.
A hot wallet is a cryptocurrency wallet connected to the Internet. For exchange, hot wallets are often used to enable fast withdrawal of one’s holdings, as the opposing “cold” wallets are meant to take some effort to access.
Announced on Twitter and in Telegram, six of the European crypto exchange ETERBASE’s hot wallets were recently compromised. These wallets are for the exchange’s Ethereum (and ERC-20 tokens), Tron, Tezos, Bitcoin, Algorand, and XRP.
According to The Block, at least $5 million worth of cryptocurrency was withdrawn from the hot wallets.
NewsBTC’s analysis of the blockchain data indicates that many of the Ethereum tokens the hacker(s) obtained have been dumped for ETH.
This is not the only crypto hack that has taken place over recent months.
As reported by NewsBTC, a long-time Bitcoin investor saw 1,400 BTC swiped from his wallet in an exploit. The pseudonymous investor explained on GitHub that he was prompted to update his Electrum Wallet with a false alert and accepted the update, which triggered the transfer of funds.
An interesting trend to watch is the ongoing flight of liquidity and crypto users from centralized exchanges to decentralized exchanges.
There’s a non-zero chance that during this market cycle, centralized exchange hacks won’t be as prominent due to growth in decentralized exchange.
For one, Ethereum’s Uniswap has been regularly processing over 100,000 trades a day worth hundreds of millions of dollars. The volume figure, at least, is higher than that of many leading exchanges.
The liquidity on some decentralized exchange crypto pairs, too, far eclipse traditional exchanges. Curve.fi allows one to trade stablecoins with extremely low slippage and fees, even if you’re looking at a transaction worth millions of dollars.
Of course, centralized exchanges always need to exist in some capacity, or else fiat capital will not enter the digital asset markets.
But again, with the rise of crypto being traded on-chain as opposed to off-chain, centralized exchange hacks may decrease in severity.
Author: Nick Chong
Cryptocurrency Market Size, Key Analysis And Comprehensive Growth Forecast Till 2026 | Fortune Business Insights
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The rising demand for online financial services in the region is likely to contribute the growth of the market in North America. Besides this, North America holds 27% participants, 39% of wallets, 18% transactions, and 19% of cryptocurrency paymen companies. This is a primary reason behind the high demand witnessed in the region. It also facilitates the higher adoption of cryptocurrency. The cryptocurrency market in Asia pacific is anticipated to expand at a relatively higher CAGR. The growth witnessed is attributable to increasing number of cryptocurrency transactions taking place in the region. Japan is known for major investments in cryptocurrency. Rising investments cryptocurrency have resulted in the formation of new laws for legalization of cryptocurrency under financial service agency. This is a major step taken by Japan and is expected to boost the Asia Pacific cryptocurrency market.
Market Landscape and Market Scenario Includes:
Europe is also amongst the leading regions in the global cryptocurrency market. The growth witnessed is attributable to high adoption of e-financial services in the region. Moreover, Germany issued a statement to consider cryptocurrency as private currency without any payable taxes, unless held for a year or more. Tax and other benefits from cryptocurrency is expected to fuel the demand for cryptocurrency and increase the number of owners globally.
Key Market Driver
Key Market Restraint
For more information in the analysis of this report, visit:https://www.fortunebusinessinsights.com/industry-reports/Cryptocurrency-market-100149
Adoption of e-wallets to Drive Market
“Government initiated awareness programs regarding cryptocurrency in developing and undeveloped nations are anticipated to enable growth in the global cryptocurrency market,” said a lead analyst at Fortune Business Insights.
Some of the chief factors expected to drive the global cryptocurrency market during the forecast period 2018-2026 are rising adoption of e-wallets and consumer shift towards online platforms. Additionally, cashback, promotional, and other offers on e-currency is a factor anticipated to fuel the demand in the global market.
On the contrary, requirement of a good network connection and high cost data tariff plans are a few factors that may hamper the growth in the global cryptocurrency market
Important Features that are under Offering and Key Highlights of the Market Report:
Top Players List:
Key Industry Developments
Queries Addressed In Cryptocurrency Market Report:
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1. By Components
2. By Process
3. By Type
4. By End User
5. By Geography
Key Features of Market Research Report:
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Lastly, this report covers the market landscape and its growth prospects over the coming years, the Report also brief deals with the product life cycle, comparing it to the relevant products from across industries that had already been commercialized details the potential for various applications, discussing about recent product innovations and gives an overview on potential regional market shares.
An Overview of the Impact of COVID-19 on this Market:
The emergence of COVID-19 has brought the world to a standstill. We understand that this health crisis has brought an unprecedented impact on businesses across industries. However, this too shall pass. Rising support from governments and several companies can help in the fight against this highly contagious disease. There are some industries that are struggling and some are thriving. Overall, almost every sector is anticipated to be impacted by the pandemic.
We are taking continuous efforts to help your business sustain and grow during COVID-19 pandemics. Based on our experience and expertise, we will offer you an impact analysis of coronavirus outbreak across industries to help you prepare for the future.
Click here to get the short-term and long-term impact of COVID-19 on this Market.
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Crypto Investors Have Ignored Three Straight 51% Attacks on ETC
Despite three “51% attacks” in a month, Ethereum Classic’s price has demonstrated strong resilience. Though down a bit for the past month, its persistence may indicate that security is not a top priority for investors rushing to join a bull run in the crypto market.
However, some warn that unless it improves its blockchain and makes it safer, additional attacks on Ethereum Classic could trigger a market sell-off and lead to a collapse of its digital asset.
For a blockchain network’s security, a “51% attack” is pretty much as bad as it gets. That’s when a single entity gains control of a majority of the network’s computing power, allowing it to siphon off extra units of the currency in what’s known as a double-spend.
Related: Ethereum Classic Labs Airs New Plan to Stop Future 51% Attacks
So it would stand to reason that three successful 51% attacks in a month against the Ethereum Classic blockchain might dent investors’ confidence. But prices for the project’s native ETC token haven’t really taken a hit – a sign traders could be less concerned about security vulnerabilities than a quick profit in fast-moving cryptocurrency markets.
At press time, ethereum classic is trading at $5.06, down about 27% in the past 30 days at the same time bitcoin is off by 15%.
Three 51% attacks in a month
For the Ethereum Classic blockchain, 51% attacks have been a threat for a long time. Unlike Ethereum, from which it was hard forked, the Ethereum Classic network is committed to the Proof-of-Work (PoW) consensus algorithm, which is also used by BItcoin. But for large networks like Bitcoin, a 51% attack is prohibitively expensive to do given the enormous amount of computational power required by PoW to successfully do it. Ethereum Classic’s hashrate is much smaller, making it far more vulnerable to 51% attacks.
Related: Ethereum Classic Hit by Third 51% Attack in a Month
By press time, the hashrate of Ethereum Classic stood at 1.668 terahash per second, while Bitcoin’s at 117.95 exashes per second, according to BitInfoCharts.
Ethereum Classic is the product of a hard fork after the Ethereum network split in different ways following an infamous hack in 2016. The PoW-based blockchain has been chasing after Ethereum, which now represents the No.2 cryptocurrency by market capitalization.
Ethereum is planning on changing its algorithm sometime next year. In a tweet thread Sept. 2, Ethereum founder Vitalik Buterin argued Ethereum’s planned Proof-of-Stake (PoS) algorithm gives it a “key fundamental” advantage over PoW.
“In PoW, on the other hand, a successful attacker can just attack over and over again, with no possible way to delete their hardware without deleting everyone else’s hardware.”
During the month of August, the Ethereum Classic network suffered not one but three 51% attacks: the first one took place on Aug. 1, the second on Aug. 6 and a third on Aug. 29.
NiceHash, a hashpower broker, acknowledged its platform may have facilitated the recent 51% attacks, in a blog post on Sept. 1, but it also concluded that such attacks cannot be prevented or mitigated in a “truly decentralized proof-of-work solution.”
“The only thing one can do is make the price of an attack higher than the attacker reward,” the post added.
The Ethereum Classic network also suffered a 51% attack in early 2019, which led crypto exchange Coinbase to halt all ETC transactions, withdrawals and deposits at the time.
The company announced two new hires on Sept. 3 to ETC’s core development team.
“These developments and partnerships are working to quickly propel the advancement of ETC and ensure a bright future for the network,” Wo said, who added that ETC’s price has held “strong” even with the recent 51% attacks.
Indeed, the attacks have not had any significant impact on its prices, which prompted a question: why would anyone put money in a token when its security is not guaranteed?
A large percentage of ETC holders received their tokens involuntarily after the Ethereum chain split and, as a result, the price of ETC has remained stable over the past few years simply because many ETC holders have ignored taking any actions.
Citing the fact that a large number of Ethereum Classic wallets have been inactive, Demirors said some ETC holders may not see the value of selling or even claiming their ETC.
“I don’t know how motivated they are to actually try to sell or try to move their assets to a wallet or on an exchange,” she said. “A lot of people just don’t think it’s worth the effort and energy.”
Ethereum Classic’s price resilience during these attacks tells the story that the majority of crypto investors right now are more focused on “short-term” price momentum trades than “long-term” chain security and fundamentals, according to John Todaro, director of institutional research at the cryptocurrency analysis firm TradeBlock.
That is in line with the red hot decentralized finance (DeFi) world where capital continues to be allocated despite warnings of high risks with certain yield farming smart contracts.
“You see people putting billions of dollars of their digital assets into unaudited smart contracts, right now I’m not sure people are really so concerned about security,” Demirors said.
And as long as the market remains in bull mode, it is likely that traders will compromise their security concerns for higher returns – until that security problem becomes big enough to trigger a collapse of the entire system.
In the DeFi world, that problem could be a few smart contract bugs. In Ethereum Classic, it could be a large-scale dump of the token as a result of any additional 51% attacks, Todaro warned.
That is not entirely impossible: After the first two attacks in August, crypto exchanges contemplated or else took drastic measures which would make ETC less accessible and attractive to investors. OKEx said that it will consider delisting the asset, and Coinbase extended deposit and withdrawal confirmation times for ETC to around two weeks.
“I think the big mover will be exchanges delisting Ethereum Classic and there are no longer any venues where you can trade it easily,” Demirors said. “I think then you may see people say ‘ok, maybe I should take my Ethereum Classic and liquidate it before it becomes impossible to do so.’”
While some have attributed crypto financial giant Grayscale’s position on ETC to its relatively stable pricing, the company refused to admit its influence on ETC’s trading.
But according to Demirors, there are only a “small” number of financial investment firms – Grayscale included – involved in this digital asset, making it natural that Grayscale is in the spotlight when it comes to Ethereum Classic.
“[Grayscale] holds a sizable percentage of the circulating supply in Ethereum Classic, which is locked up in the trust that will never be liquidated,” she said. “So I think some of those natural factors, which can drain the supply of Ethereum Classic on the market, have a dampening impact on the price.”
As of July 31, 2020, Grayscale’s Ethereum Classic trust had $86.4 million of assets under management. That was equal to about 10% of Ethereum Classic’s market cap of $861.7 million on that date. As of press time, total market cap was down to $619.8 million.
The recent 51% attacks on the Ethereum Classic network also have not led to any additional questions or worries from Grayscale’s clients on this crypto asset, according to Grayscale’s Sonneshein. Grayscale started its ETC Trust in April 2017.
- Crypto Investors Have Ignored Three Straight 51% Attacks on ETC
- Crypto Investors Have Ignored Three Straight 51% Attacks on ETC
Author: Muyao Shen