If you have been looking at crypto projects for any amount of time, you have probably run into the terms, "verified" and "renounced." These terms are used when discussing a token’s smart contract and can help provide the investor with some crucial information when deciding whether or not to invest in a project.
But what do they really mean? And more importantly, are these a good or a bad thing for you as an investor?

🧿 What Does Verified Contract Mean?
A verified contract is where the developer has uploaded a human-readable “plain text” version of the contract code which is automatically compared to the version the blockchain has to ensure it matches. This is important because sites like Etherscan display the text version for users to dig into a contract's code.
The risk of a non-verified contract is that a user cannot verify what the contract actually does. This is a concern because you are fully (and blindly) trusting the developer. The general understanding is if a contract is not verified, it is probably a scam, as there is no legitimate reason not to verify the contract.
So yes, a verified contract is in fact a good thing!

What Does "Renounced Contract" Mean?
Renouncing a contract is a fancy way of saying the developer is giving up ownership or control of the contract, and with that, the ability to make future changes using the contract.

There are pros and cons to renouncing a contract:
Pros:
Taxes cannot be changedTypically limits changes that could affect an investorsCannot black list a walletCan provide confidence to investors that items will not change
Cons:
Unable to blacklist botsUnable to whitelist exchangesUnable to modify taxes (e.g. push more of the tax to marketing vs development)"Typically" means whatever is set in the contract is how it will remains
So while a renounced contract is more of a grey area in terms of "good" or "bad," it's important to know this piece of information when you're interested in a project. Overall, the general sentiment has shifted from “You must renounce” to “It is ok to not renounce as long as you have valid reasons”.
It is also important to note that there are scammers who will put code into contracts that allow them to perform certain actions even when the contract is renounced! Some scammers will even put code in to regain contract ownership.

In conclusion, understanding the terms "verified" and "renounced" is crucial when evaluating potential crypto investments. A "verified contract" is generally a positive sign as it allows users to inspect the contract code, reducing the risk of potential scams. On the other hand, a "renounced contract" can have both advantages and disadvantages. It signifies the developer's relinquishment of control, ensuring that key parameters like taxes remain unaltered, but it may limit certain essential modifications and exposes investors to potential risks.The cryptocurrency landscape is dynamic, and the importance of these terms can evolve over time. It's essential for investors to consider these factors in the broader context of a project's transparency, the reputation of its development team, and the specific circumstances surrounding the contract. Due diligence is key in the crypto world, and staying informed about the latest developments and trends is vital to making informed investment decisions.
#Binance #DeFiChallenge #cryptocurrency #smartcontract

The European Union (EU) Council has agreed to amend the Data Law, which mandates a ‘kill switch’ for applications using smart contracts, according to local industry sources.

This comes after the EU Parliament passed the ‘Data Act‘ on March 14, which weakens the immutability of smart contracts. The bill includes regulations requiring smart contracts to have access control, transaction confidentiality protection, and suspend and reset functions.

However, the decentralized finance (DeFi) market is protesting that these functions required by the bill may undermine the original purpose of smart contracts, which are contracts that are automatically executed through code recorded on a public blockchain without an intermediary. The DeFi market argues that the bill could potentially compromise the public and immutable nature of smart contracts, which is a fundamental aspect of blockchain technology.

Popular decentralized exchange (DEX) Curve Finance has already spoken out against the bill, saying that it is impossible to implement. Other players in the DeFi market are likely to follow suit, as they consider the bill to be a significant threat to their operations.

The bill went to a three-way consultation in which the European Union Parliament, the Council and the Executive Committee discussed details. The first related meeting was held on the same day that the EU Council agreed to amend the Data Law. The final draft of the data law will be decided after negotiations between the Parliament and the Council through the mediation of the European Commission.

The passing of the Data Act and the subsequent amendment of the Data Law highlights the ongoing debate around the regulation of blockchain technology and its applications. While some argue that regulations are necessary to ensure the protection of users and to prevent abuse, others argue that excessive regulation could stifle innovation and compromise the core principles of blockchain technology. As the DeFi market continues to grow and evolve, it is likely that similar debates will continue to emerge in the future.

#EU #Data #smartcontract #crypto2023 #azcoinnews

This article was republished from azcoinnews.com

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