Set achievable financial objectives and use effective strategies to track progress and achieve success.

Before setting a financial goal, it’s important to have a clear understanding of your current financial situation, including income, debt, expenses and assets. Once you have a clear understanding of your current financial situation, you can start setting financial goals that align with your values and priorities.

Here are six steps to set and achieve your financial goals.

Define your financial goals

Set both short- and long-term financial goals as your first step. Your objectives should be specific, measurable, achievable, relevant and time-bound (SMART). One’s short-term objectives might be, for instance, saving $500 for an emergency fund or paying off $1,000 in credit card debt within the next six months, while their long-term objectives might be setting aside $10,000 for a down payment on a home or investing $100,000 for retirement within the following 10 years.

Similarly, in terms of crypto, one’s short-term objectives might be to purchase a specific quantity of Bitcoin  or Ether within the next three months, whereas their long-term objectives might be to hold a specific quantity of a particular cryptocurrency for an extended period of time.

Develop a plan

Create a strategy to achieve your goals after you’ve defined them. This strategy should outline the precise steps you’ll take to accomplish your objectives. For instance, if your goal is to buy a certain amount of BTC within the next three months, your plan may include researching and choosing a reputable crypto exchange, setting up a crypto wallet and regularly monitoring the price of Bitcoin to make an informed purchase.

Track your progress

To determine whether you are on track to achieving your financial objectives, monitor your progress frequently. This will assist you in identifying any areas where your plan might need to be modified.

Stay disciplined

Staying disciplined is crucial when it comes to achieving financial goals. Stick to your plan and avoid any unnecessary spending that could derail your progress.

Be flexible

Be prepared to adjust your plan if necessary. Because life can be erratic and unforeseen costs occasionally appear, you might need to modify your plan.

Celebrate your success

When you reach your financial objectives, congratulate yourself on a job well done. This will encourage you to keep striving for your upcoming objective.

Strategies to set financial goals using cryptocurrencies

Here are some strategies for setting financial goals using cryptocurrencies:

Determine your investment goals and risk tolerance: Prior to investing in cryptocurrencies, make a decision regarding your financial objectives and risk tolerance. As a result, you may select the appropriate digital currencies and minimize risks.

Research and analyze the potential risks and rewards of investing in cryptocurrencies: Choose your financial goals and risk tolerance before investing in cryptocurrency. Then, select the suitable digital currencies that match your risk-return profile, lowering risks.

Create a diversified portfolio of cryptocurrencies: Avoid putting all your eggs in one basket by investing in a diverse range of digital currencies. This spreads the risk and protects you against market volatility.

Set realistic short-term and long-term financial goals: Establish short- and long-term, attainable financial goals and objectives. This keeps you motivated and engaged while keeping track of your advancement.

Stay informed about the latest news and developments in the crypto market: Follow the most recent market news and happenings to stay informed. This assists you in making judgements that are based on market trends and new prospects.

Before investing in cryptocurrencies, it is essential to understand the risks involved and make informed decisions based on your risk tolerance and investment goals. Precaution is necessary with any investment asset, including cryptocurrencies, because investments always carry some degree of risk. Assessment helps investors minimize potential losses and maximize returns.

Opportunity cost is the potential benefit that is missed out on when choosing one option over another.

Opportunity cost, explained

Opportunity cost is a concept in economics that refers to the value of the next best alternative that is forgone when making a choice — i.e., the cost of the best alternative that is not chosen.

Consider the scenario when you have a limited budget and are debating between buying a new laptop or going on vacation. The value of the vacation you could have taken with the same amount of money would be the opportunity cost if you decide to buy the laptop. Similarly, if you decide to take the vacation, the opportunity cost would be the laptop you could have purchased with the same amount of money.

Opportunity cost is a crucial factor to take into account when making decisions because it enables you to weigh the advantages and disadvantages of many options and come to the best decision possible based on one’s preferences and limits. By understanding the opportunity cost of a decision, individuals can better assess the true costs and benefits of the choices available to them.

Relevance of the opportunity cost concept in the crypto world

Opportunity cost is an important notion in the crypto industry because it is a highly speculative industry with large potential rewards and losses. The opportunity cost of hanging onto a certain asset vs. investing in a different asset must be considered by cryptocurrency traders and investors.

Consider a trader who made an investment in a cryptocurrency that has recently seen a significant rise in value. The trader can be tempted to keep the asset in the hopes that its value will rise more, but doing so prevents them from investing in other assets that might have superior growth potential. On the other hand, if the trader sells the asset to invest in another cryptocurrency that they believe has better growth potential, they risk missing out on potential gains if the original cryptocurrency continues to rise in value.

While miners choose what cryptocurrencies to mine based on expected profits and the resources needed to mine each asset, opportunity cost is also important in the cryptocurrency mining process. Miners can increase their profitability and prevent losing out on opportunities by weighing the opportunity cost of mining one cryptocurrency over another.

Opportunity cost vs. sunk cost

Opportunity cost refers to the potential benefits that are foregone by choosing one option over another, while sunk cost refers to costs that have already been incurred and cannot be recovered. Opportunity cost and sunk cost are both concepts used in economics and decision-making analysis, but they represent different things:

A cryptocurrency investment that has seen a considerable drop in value is one example of a sunk cost. A person’s investment in a cryptocurrency becomes a sunk cost once they’ve made it; they can’t get their money back until the value of the cryptocurrency increases.

For instance, suppose an investor spends $10,000 on a cryptocurrency, after which the value of that coin falls to $5,000. The initial $10,000 investment becomes a sunk cost if the investor chooses to keep the coin rather than sell it. This is due to the fact that the money has already been spent and cannot be recovered until the value of the cryptocurrency increases. The sunk cost fallacy may be at play if the investor keeps holding onto the crypto in the hopes that its value will rise, which could result in greater losses.

The opportunity cost of using blockchain: How does it affect business?

Blockchain technology has the potential to revolutionize the way businesses operate. However, using blockchain comes with opportunity costs that businesses need to consider. Therefore, companies must weigh the potential advantages of blockchain technology against the costs and trade-offs of deploying it before deciding whether to use it.

The greater security and transparency that blockchain technology offers is one of its main advantages. Blockchain offers a safe way to store and distribute data because it employs a decentralized ledger that is nearly impossible to compromise. Businesses handling sensitive information, such as financial or medical data, may find this to be very helpful. Also, the openness of blockchain can foster greater interparty trust, which is advantageous for companies operating in industries with a high degree of risk or fraud.

As mentioned, there are costs and trade-offs associated with using blockchain. The cost of developing and maintaining the technology is one of the major expenses associated with using blockchain. Blockchain technology is still in its infancy, and its implementation can be expensive. A blockchain network also needs a lot of computational power to be maintained, which can be expensive.

Furthermore, the chance of missing out on alternative technology or solutions is another opportunity cost of embracing blockchain. Companies that aggressively invest in blockchain technology might miss out on chances to fund other cutting-edge technologies that might prove more beneficial in the long term.

Understanding the time value of money is essential for making sound financial decisions and maximizing returns on investment.

Time value of money, explained

The time value of money (TVM) is the concept that money available today is worth more than the same amount of money in the future. While inflation gradually weakens the purchasing power of money, its worth can rise over time by being invested or earning interest.

The time value of money is an essential concept in finance and investing. Based on the interest rate and the time period involved, it is used to determine the present value of future cash flows, such as investment returns or loan repayments.

Several financial calculations — such as future value, present value and annuities — can be used to show the TVM. Understanding the time value of money is crucial in making informed financial decisions, such as comparing investment options, deciding on loan terms and planning for retirement.

Annuities can be of two types: ordinary annuity and annuity due. In an ordinary annuity, the cash flows occur at the end of each period; while in an annuity due, the cash flows occur at the beginning of each period.

Does the time value of money concept apply to crypto?

The time value of money concept can also be applied in the world of cryptocurrency. In fact, it is an important principle to consider when evaluating the potential profitability of investing in cryptocurrencies.

Crypto lending platforms

The use of crypto lending platforms is one way that the time value of money principle is applied in the world of cryptocurrencies. These services enable users to earn interest on their investments by lending their cryptocurrency to other users.

The supply and demand of the cryptocurrency, the duration of the loan term, and the risk involved with the borrower are just a few of the variables that affect the interest rate that users can receive on their cryptocurrency investments. Due to the time value of money, the interest rate investors can earn on their investment increases with the length of the lending period.

Staking

Another application of the time value of money concept in crypto is through the use of staking. Staking entails keeping a specific quantity of cryptocurrency locked on a blockchain in order to benefit the network and sustain it. Staking incentives are typically driven by the length of time a user locks in their cryptocurrency, with longer staking periods leading to bigger rewards due to the time value of money.

Determine the potential future value of a cryptocurrency investment

Furthermore, the TVM concept can also be used to assess the potential future value of a cryptocurrency investment. The value of a cryptocurrency might change over time due to various variables, including market supply and demand, legislative changes and technological improvements, just like the value of any other investment.

The time value of money must be taken into account when estimating the possible future worth of a cryptocurrency investment, as the value of the investment will vary depending on how long it takes to reach its full potential.

1. What is monetary policy in crypto?

Monetary policy in crypto refers to the mechanisms used to manage the supply and circulation of cryptocurrencies. These mechanisms are intended to ensure the sustainability, stability and predictability of a coin’s value over time.

Cryptocurrencies rely on decentralized protocols to handle their monetary policy, as opposed to conventional fiat currencies, which are controlled by central banks and governments. These protocols may contain a number of tools for regulating the cryptocurrency’s supply, including block rewards, changes to the mining difficulty and issuance rates.

For instance, Bitcoin (BTC) has a fixed supply cap of 21 million coins. As time goes on, the pace at which new coins are introduced to the supply continuously declines, eventually causing a deflationary situation as the rate of new supply gets closer to zero.

On the contrary, certain cryptocurrencies may employ alternative mechanisms to govern their monetary policy, like proof-of-stake (PoS) consensus systems, which use staking to encourage network activity and control the cryptocurrency supply.

2. How do cryptocurrencies have monetary value?

Cryptocurrencies have monetary value because people assign value to them, much like any other currency or asset. 

A cryptocurrency’s value is primarily influenced by market forces of supply and demand. A cryptocurrency will become more expensive if there are more buyers than there are sellers prepared to accept their offers. The price will fall, however, if there are more sellers of a cryptocurrency than there are buyers ready to purchase it.

Other factors that can influence the value of a cryptocurrency include its utility, security and adoption. For instance, a cryptocurrency that is widely recognized as a form of payment and has a clear use case will probably be worth more than one that is not extensively accepted. Furthermore, cryptocurrencies with robust security features and a track record of dependability will often be more valuable than those with lax security or a history of hacks and flaws.

3. How will cryptocurrencies affect monetary policy?

Although the precise impact will depend on how widely cryptocurrencies are used and integrated into the current financial system, cryptocurrencies have the potential to influence monetary policy in a number of ways. 

Here are some possible ways in which cryptocurrencies could affect monetary policy:

Reduced control over the money supply: Due to the decentralized nature of cryptocurrencies and the lack of a central controlling entity, standard monetary policy tools like printing money or changing interest rates may not have the same effect on them as they do on fiat currencies. This might restrict central banks’ power to affect the total amount of fiat money in circulation.

New sources of data: Large amounts of transactional data generated by cryptocurrencies could be used to get important insights into consumer behavior and broader economic patterns. It may be necessary for central banks to figure out how to include this data in the decision-making process.

Increased competition: Since cryptocurrencies provide an alternate method of payment and a store of value, they may become more competitive than traditional fiat currencies. This can put pressure on central banks to keep their currencies stable and valuable to remain competitive. Additionally, banks are experimenting with CBDC projects in response to the potential threat of cryptocurrencies, which could disrupt traditional banking and payment systems.

Enhanced financial inclusion: Cryptocurrencies have the potential to give people and enterprises who might not have access to traditional banking services better financial access and inclusion. As a result, monetary policy may shift as central banks may need to consider how a more diversified and decentralized financial system will behave.

4. Who controls Bitcoin’s monetary policy?

BTC’s monetary policy is controlled by the rules built into the Bitcoin software protocol, which is open-source and operates in a decentralized manner. 

The protocol’s rules dictate how new BTC is created and distributed over time. Moreover, any proposed changes to the protocol must be approved by a majority of the network’s users, making Bitcoin’s monetary policy subject to the consensus of its users.

Particularly, the protocol’s built-in issuance schedule serves as the foundation for Bitcoin’s monetary policy. The total number of BTC that will ever be created is 21 million. New Bitcoin is produced through a process called mining, where users compete to solve challenging mathematical problems in exchange for rewards that include newly created BTC.

The mining reward is automatically reduced by half every 210,000 blocks (approximately every four years), a process known as halving. This indicates that as time passes, the rate of new BTC generation declines, eventually resulting in a maximum supply of 21 million. One of the main components of Bitcoin’s monetary policy is its constant supply, which works to maintain scarcity and prevent inflation.

5. Do stablecoins alter the monetary policy transmission mechanism?

Stablecoins may function outside of conventional banking and payment systems and may offer an alternative form of payment and store of value, which has the potential to change how monetary policy is transmitted.

A classic monetary policy transmission mechanism involves the employment of various tools, such as changing interest rates by central banks to affect the money supply, the actions of financial institutions and the behavior of people. Stablecoins, however, might operate separately from these conventional dynamics and might not be directly impacted by adjustments to interest rates or other monetary policy instruments.

For instance, stablecoins may be considered a safe-haven asset, particularly during periods of market turbulence or economic unpredictability. Stablecoins may see a surge in popularity during these times, which may lessen the impact of conventional monetary policy tools like interest rate increases.

Moreover, stablecoins might alter the demand for conventional fiat currencies and affect the effectiveness of monetary policy if they were to gain widespread adoption. Nonetheless, in order to account for stablecoins’ effects on the whole economy and incorporate them into their policy frameworks, central banks may need to develop new strategies.

6. How might central bank digital currency design choices affect monetary policy?

The design choices, such as the level of privacy — i.e., anonymous or fully traceable transactions — implemented in the creation of a CBDC can have significant implications for monetary policy. 

Continuing the privacy design choice example, let’s understand its impact on monetary policy in the following two scenarios.

Scenario 1: Anonymous and untraceable transactions

It might be more challenging for central banks to develop certain monetary policy instruments that depend on transaction data to monitor and control the money supply if a CBDC is created to be entirely anonymous and untraceable. 

For instance, if a CBDC is entirely private, it could be more challenging for central banks to identify and stop illegal activity, such as money laundering and tax evasion, which might have an influence on the stability of the financial system and the efficacy of monetary policy. The use of CBDCs to execute policies such as capital limits or negative interest rates may also make it harder for central banks to monitor and regulate.

Capital limits are limitations on the total amount of CBDC that a person or organization may own. Capital restrictions can be used as a measure to prevent CBDCs from being hoarded and promote consumption, which will help the economy thrive. Capital restrictions, however, may also have unforeseen effects, such as increasing demand for alternative assets or changing the composition of the money supply.

When the interest rate on deposits is negative, depositors must pay the bank to store their funds rather than earning interest — i.e., interest rates on deposits fall below zero. This is referred to as a negative interest rate at banks, when a central bank uses a negative interest rate policy to encourage investment and expenditure during economic downturns. 

A CBDC may also enable central banks to execute negative interest rate policies that promote expenditure and discourage hoarding if they are intended to be interest-bearing. Negative interest rate policies, however, may also have unintended consequences that could increase financial instability by decreasing the incentive for savers to deposit their money in banks.

Scenario 2: Transparent and traceable transactions

On the other hand, a CBDC might possibly offer central banks useful data insights into consumer behavior and economic patterns, which could guide their policymaking processes if it is created to be completely transparent and traceable. However, it could also raise concerns about privacy and surveillance.

Therefore, central banks will need to carefully consider the trade-offs between these policies and ensure they are designed in a way that supports economic growth and stability while minimizing the risk of another global financial crisis.

Blockchain’s transparency and traceability can aid sustainability and reduce carbon emissions for climate change.

With rising temperatures, melting ice caps and more frequent and intense extreme weather events, the effects of climate change are becoming more and more obvious. There is an urgent need to prevent climate change, and numerous technologies and methods are being investigated to do so. Blockchain technology is one of these possibilities, and it has the potential to be very effective in the fight against climate change.

At its core, blockchain is a decentralized ledger that can securely and transparently record transactions and store data. This technology has already been used in a variety of applications, from cryptocurrency to supply chain management. However, its potential applications in combating climate change are still being explored.

Here are a few ways in which blockchain can help combat climate change.

Creation and management of carbon credits

The creation and administration of carbon credits is one way that blockchain technology can help fight climate change. A tradable permit called a “carbon credit” permits the holder to emit a certain amount of greenhouse gases, such as carbon dioxide. To reduce their emissions, businesses and organizations can buy carbon credits, which can be traded on a market.

The management of carbon credits may become more transparent and effective with the use of blockchain. All carbon credit transactions can be tracked in real-time and documented using a decentralized ledger. By doing so, fraud can be avoided, and the intended use of carbon credits can be guaranteed.

The management of carbon credits may become more transparent and effective with the use of blockchain. All carbon credit transactions can be tracked in real-time and documented using a decentralized ledger. By doing so, fraud can be avoided, and the intended use of carbon credits can be guaranteed.

Promote renewable energy sources

By establishing a decentralized energy infrastructure, blockchain technology can also encourage the adoption of renewable energy sources. Without the aid of a centralized organization or utility company, people and companies can buy and sell renewable energy directly from and to one another using a decentralized energy grid. This can support the adoption of renewable energy sources, such as solar and wind power, and lessen dependency on fossil fuels.

Supply chain management

Supply chain management is another area where blockchain technology is being used to tackle climate change. Businesses can find opportunities to lower their carbon footprint and make more sustainable decisions by utilizing blockchain to track the carbon footprint of products and materials across the supply chain. By promoting sustainable production and consumption practices, greenhouse gas emissions can be significantly reduced.

Monitoring and reporting carbon emissions

The monitoring and reporting of carbon emissions from numerous sources, such as businesses, vehicles and structures, can also be done using blockchain technology. Governments and organizations can more precisely measure and report on their emissions and monitor progress toward their emission reduction targets by utilizing a decentralized ledger to track emissions.

Challenges to implementing blockchain to reduce carbon emissions

Using blockchain technology to address climate change is not without its difficulties and restrictions. The requirement for standardization and compatibility is one obstacle. Blockchain needs a uniform set of rules and protocols that all stakeholders can agree upon in order to manage carbon credits and track emissions effectively.

The scalability of blockchain technology presents another difficulty. Many blockchain networks currently only have a modest amount of capacity and can only process a small number of transactions. If blockchain is widely utilized to manage carbon credits or track emissions, this might become a bottleneck.

Last but not least, there are issues with the energy usage of blockchain technology. Some of the environmental advantages of adopting blockchain to fight climate change may be outweighed by the energy consumption necessary for blockchain transactions.

The road ahead

Although blockchain technology is still in its infancy in terms of adoption and development, its prospective uses in halting climate change are promising. Blockchain can hasten the shift to a low-carbon economy by enhancing transparency, efficiency and accountability in regulating carbon emissions and encouraging sustainable practices.

Yet in order for blockchain to be successful in addressing climate change, there are also difficulties and constraints that must be overcome. Ultimately, a combination of technologies and solutions will be required to address the complex and urgent challenge of climate change.

1. What is a crypto launchpad?

Crypto launchpads bring together the ethos of decentralized ecosystems and the ability of that community to make trustless investments.

The cryptocurrency industry and Web3 have been a hotbed of innovation that has put the community at the forefront. It thrives on the proliferation of decentralized ecosystems, breaking away from central hegemony by various incumbent bodies. The advent of crypto launchpads could be the beginning of a decentralized venture capital model.

steps to use crypto launchpas

The era of Bitcoin (BTC) and Ether (ETH) paved the way to new altcoins. However, by the end of 2022, there were over 16,000 cryptocurrencies. How can an enthusiastic investor pick good projects from so many? True to its ethos around decentralization, one of the most fascinating innovations that brings together investors, projects, innovators and the retail audience is a crypto launchpad. What do these launchpads do? 

Crypto launchpads facilitate investments and empower investors to make informed decisions through rigorous due diligence. They take the pain of curating investment opportunities from retail investors and offer them the ability to invest into cryptocurrency projects at preferential terms on valuations. 

Retail investors who want to participate in these investment rounds will buy the tokens of the crypto launchpads. Depending on token holding quantity, investors are typically bucketed under tiers that determine the access and valuations they get with investment opportunities.

Terms that investors get from these launchpads vary from preferential to exclusive. Preferential investment terms are generally in line with what other investors get. However, launchpad tokenholders get first preference to invest into those opportunities. Exclusive terms are those that are offered only to launchpad tokenholders. Either way, launchpad participants benefit from the structure.

2. Why is a crypto launchpad required?

Crypto launchpads offers communities access to high quality deals curated by experienced investors from the community itself. 

One primary reason why crypto launchpads exist is to give investors access to information that will aid in their decision making for investing in cryptocurrency projects. This can be a critical differentiator in a bull market, when it is hard for even the experienced investor to cut out the noise and pick good investment opportunities with sound fundamentals. 

The second reason why crypto launchpads are critical to Web3 is to offer the retail investors access to high-quality deals. In the Web2 world, retail investors generally do not get access to high-quality projects before they are listed on an exchange. They also do not have experts vetting the financials of companies and providing detailed due diligence reports. 

Access to high-quality deals and ease of decision-making based on well-researched information on potential investments are privileges only a few enjoy in Web2. With a decentralized model, launchpads — aka crypto accelerators — have opened up access for retail audiences to high-quality investment opportunities.

3. What benefits do crypto launchpads provide for stakeholders in the ecosystem?

There is a tripartite dynamic in the Web3 ecosystem that encompasses the investor, the project and the community. But what does each player get for being on the launchpad? 

The most important benefit for the startup listing on a launchpad is the capital it gets from investors and community members of the launchpad. Retail investors who visit the launchpad will have the ability to look at Web3 projects listed, understand the team behind the projects along with the type of community the project has nurtured, and can invest their capital into curated opportunities. 

Web3 projects get credibility after getting listed on a launchpad, which is critical in the ecosystem. Crypto launchpads also offer a plethora of services to early-stage crypto entrepreneurs, such as tokenomics advice, marketing inputs, investor introductions and other ancillary business services. Crypto launchpads are the Web3 equivalent of incubators and accelerators in the Web2 space.

Despite these benefits, launchpads can only be as good as the quality of the community members and the key people in the community who bring the right investment opportunities. Web2 has got it right with organizations like Y Combinator, Startupbootcamp and several others pioneering the accelerator model. Web3 has yet to see such a legacy develop.

Finally, for the Web3 ecosystem, crypto launchpads have successfully created a framework to cut out the noise and identify projects that merit investors’ attention. As a result, the number of scams and rug pulls on investors should reduce as the model matures, which in turn will benefit the Web3 ecosystem on sentiment and reputational perspective.

4. How can DeFi projects benefit from launchpads?

There are several crypto launchpads, such as DAO Maker and BSCPad, that successfully operated through the previous crypto cycle. As the next crypto cycle kicks off, cryptocurrency launchpads could be a key cog in the ecosystem.

For a project to get incubated by a launchpad, it must submit extensive details to get vetted. Some of the key operational details required are permission to perform a Know Your Customer check on stakeholders, information on partners, existing investors and advisers, status of smart contract audits, the quality of user base and unit economics.

The level of due diligence that crypto launchpads conduct is essential particularly in the decentralized finance (DeFi) space. DeFi has been plagued by smart contract vulnerabilities, oracle breaches and cross chain bridge hacks. A thorough smart contract audit from a reputable audit firm can help put the investors’ mind at rest.

Therefore, for the Web3 world to flourish, effective operation of crypto launchpads is crucial — especially when the right projects with good-quality products and vision need to be identified. The model is still in its infancy and must focus on better-quality launchpad communities with a track record that spans multiple crypto cycles. This practice would make launchpads a foundational building block of the Web3 ecosystem.

When carefully configured, cryptocurrency grid trading bots automatically execute orders to make profitable trades.

Grid trading is a quantitative trading strategy that involves placing automated buy and sell orders in an attempt to profit from the volatility of cryptocurrencies. Grid trading is a style of algorithmic trading that automates order execution by utilizing grid trading bots. 

To create a grid of orders that covers a range of potential market movements, this method entails placing numerous orders at incremental price levels above and below the present market price.

Generally, the trading bot places buy/sell orders between a predetermined price range, constructing an automated trading grid. This automation allows crypto traders to benefit and make profits on even small price fluctuations and avoid emotional decisions thereby increasing profitability potential in both bull and bear markets. 

This article explains what grid trading is, how grid trading bots work and their benefits for traders.

What is grid trading?

The price of cryptocurrencies fluctuates; therefore, seasoned cryptocurrency traders rely on crypto market charts to make trading decisions. However, it can be difficult to keep up when cryptocurrency prices swing wildly, resulting in missed opportunities and sometimes market FOMO. For traders trading in multiple crypto assets and on multiple cryptocurrency exchanges, things get complicated, and constant monitoring becomes a difficult task. 

This is where the grid trading strategy may be helpful as a quantitative crypto trading method. Grid trading helps in buying and selling cryptocurrencies in a range set by the trader. The strategy is based on the idea that the price of an asset will fluctuate within a certain range, and by placing orders at different points within that range, the trader can capture profits from both the upward and downward movements of the price. This essentially creates an area or a grid where the grid trading bot will work and calculate profitable buy-sell orders. 

Related: Cryptocurrency investment: The ultimate indicators for crypto trading

What are grid trading bots, and how do they work?

Grid trading bots are trading algorithms or codes that attempt to make profits from price changes within the predefined grid area. The trader sets up the parameters or limits for the grid trading bot to function within the predefined range and execute orders as per forethought rules. Thus, grid trading bot orders automate crypto trading.

Let’s take a hypothetical Bitcoin/Tether trade example to understand how a grid trading bot works and what parameters are taken into consideration. It is important to ensure sufficient funds are available in your wallet before setting up the grid.

Set upper and lower grid limits

 Let’s imagine that the price of Bitcoin BTC has neared $15,000 in the past two-week period. The trader has 5,000 Tether USDT $1.00  and decides to trade $600 above and below the range. That makes $15,600 the upper limit price and $14,400 the lower limit. 

upper and lower grid limits

Create multiple grid levels

The next step is to divide the interval upper limit price and interval lower limit price into grid levels. Each exchange has its rules; however, manual and automatic settings are available across all major exchanges, such as Binance, Crypto.com, ByBit, etc. In manual mode, the trader may select levels, and in the automatic mode, grid levels are determined automatically.

The selected grid number is a determinant of the amount of buy and sell orders in that grid. So in this example, it is set at 7 levels. One is free to select and create as many grid levels as required.

Multiple Grid Levels

This will result in the following predefined limit within which the grid trading bot will now function. 

Parameters for grid trading bot to function

When the price rises and crosses the Sell grid, the bot sells BTC and makes a profit. Similarly, when the price dips in the Buy grid, the bot automatically buys BTC. Buying and selling continue with the aim of making a profit until the trader stops the bot or the timer runs out. 

It is important to note that all the above parameter settings are for reference only. The parameters may change depending on one’s investment goals and risk-return trade-off. Moreover, crypto trading involves risks, and traders must acquaint themselves with all possibilities before setting up grid trading.

Benefits of using a grid trading bot

Trading cryptocurrencies can be time-intensive, and automation tools can help investors to make better, rational and profitable decisions. Crypto grid trading bots are beneficial for the following reasons: 

Automated trade execution

Grid trading bots can automatically execute trades based on predetermined rules, which can save time and reduce emotional decision-making. Traders can also scale their trades by creating multiple grid trading bots for different coin pairs simultaneously. 

Faster and rational decision-making

Bots can make decisions more quickly than traders. Additionally, because they are unaffected by emotions, FOMO, peer pressure or social media trends, they can maintain their trading rationale even during erratic and volatile market conditions.

Risk management

Grid trading bots can be programmed to automatically close trades if certain risk thresholds are reached, which can help to minimize potential losses. Additionally, diversifying trading among many coin pairs instead of trading in a single pair is a well-known risk management strategy: “Don’t put all your eggs in one basket.” Using grid trading bots makes it easier to trade simultaneously in multiple pairs. 

Is grid trading strategy profitable?

Crypto grid trading strategies have the potential to generate profits if grid parameters are configured carefully.

While grid limits and grid levels are mandatory for setting up a grid trading bot, the following terms and settings are optional on most cryptocurrency exchanges. However, when used in conjunction with grid limits and grid level, these settings help to make more clinical trades.

Trigger price: This is the pre-set price at which the grid trading bot will initiate its operations. No buy/sell activity will happen until the market price hits the trigger price. Once the market price and trigger price are the same, the bot is triggered and the grid becomes active for trade.

Stop loss price: As the name suggests, this is the point where the trading grid bot will automatically close all positions to protect against a heavy loss. The stop loss point is below both the lowest price limit and the trigger price. Setting this up will help protect the trader because when the market price hits below the stop loss price, the trading grid will stop working. 

Take profit price: This is higher than both the upper price limit and the trigger point. When the market price hits the take profit price, the bot will sell the base cryptocurrency, collect the profit, and terminate automatically.

Another important aspect to take into account when using a grid trading bot is the trading fees. If the trading fees on the exchange are high and the grid trading bot executes several transactions quickly in a short period, then the trading fees can add up and eat into the overall profits. One must make sure that overall, the trades generate more profit than incurred costs.

Grid trading takes place in both spot and futures crypto trading. Spot grid trading bots generate profits only on capital deployed since they use spot wallet funds and insufficient funds will automatically stop the trade. This makes spot trading relatively safer since the trade is solely with one’s own money. Futures grid trading bots use margin trades and can borrow funds beyond available capital. This allows traders to make larger crypto trades amid extra risk exposure.

Flags are among the most-referred patterns in technical analysis that can provide clues to the price trend and potential next move.

In technical analysis, a flag pattern indicates short-term price movements inside a parallelogram coounter to the previous long-term trend. Traditional analysts view flags as potential trend continuation indicators.

There are two types of flag patterns: bull flag and bear flag. While their outcomes are different, each flag exhibits five key characteristics, as listed below:

The strong preceding trend (flagpole or pole)

The consolidation channel (the flag itself)

The trading volume pattern

A breakout

A confirmation of the price moving in the direction of its previous trend.

In this article, we discuss bull and bear flag patterns and how to trade them.

What is a bull flag pattern?

A bull flag is a technical pattern that appears when the price consolidates lower inside a downward-sloping channel after a strong uptrend. The said channel comprises two parallel, rising trendlines. Kindly note that the pattern could be a wedge or a pennant if the trendlines converge.

The volume typically dries up during consolidation, implying that traders associated with the preceding trend have less urgency to buy or sell during the consolidation period.

Bull flag

The urgency to jump in by new and old investors, or “FOMO” (fear of missing out), typically returns when the price breaks above the bull flag’s upper trendline, thus boosting trading volumes.

As a result, analysts view strong volumes as a sign of a successful bull flag breakout.

On the other hand, lackluster volumes when the price breaks above the bull flag's upper trendline increase the possibility of a fakeout. In other words, the price risks dropping below the upper trendline, thus invalidating the bullish continuation setup.

Trading a bull flag setup

Traders can enter a long position at the bottom of a bull flag in anticipation that the price’s next run-up toward the pattern’s upper trendline will result in a breakout. The more risk-averse traders can wait for a breakout confirmation before opening a long position. 

As for the upside target, a bull flag breakout typically prompts the price to rise by as much as the flagpole’s size when measured from the flag’s bottom.

The following Bitcoin price pattern between December 2020 and February 2021 shows a successful bull flag breakout setup.

BTC/USD daily price

As a note of caution, traders should maintain their risks by placing a stop loss just below their entry levels. That will enable them to reduce their losses if the bull flag gets invalidated.

What is a bear flag pattern

A bear flag pattern is the opposite of a bull flag pattern, exhibiting an initial downside move followed by an upward consolidation inside a parallel channel. The downside move is called the flagpole, and the upward consolidation channel is the bear flag itself.

Meanwhile, the period of bear flag formation tends to coincide with declining trading volumes.

Bear Flag

Trading a bear flag pattern

The following is an illustration of how to trade bear flag pattern on crypto charts.

BTC/USD daily price chart featuring a bear flag breakdown

In the Bitcoin chart above, the price has formed a flagpole followed by an upward retracement inside a rising parallel channel. Eventually, BTC price breaks out of the channel range to the downside and drops by as much as the flagpole’s height. 

Traders can choose to open a short position on a pullback from the flag’s upper trendline or wait until the price breaks below the lower trendline with rising volumes.

In either case, the short target is, as a rule, measured by subtracting the flag’s peak from the flagpole size.

Meanwhile, a breakdown below the flag’s lower trendline accompanying lackluster volumes suggests a fakeout, meaning the price may reclaim the lower trendline as support for a potential rebound inside the parallel channel.

To limit losses in a fakeout scenario, it is important to place a stop loss just above the entry levels. 

#candles #candlesticks #educational #Bitcon #crypto2023

Hyperledger Foundation executive director Daniela Barbosa says some challenges in adopting enterprise blockchain include a lack of complete comprehension of its advantages.

Blockchain technology is often a valuable tool in solving various business challenges due to its ability to create secure, trusted, transparent data sources, and it has gained traction across various industries as businesses seek efficiency and cost reductions.

Daniela Barbosa, the executive director of the open-source blockchain development firm the Hyperledger Foundation, spoke to Cointelegraph about how blockchain for enterprise is transforming global markets and industries.

Barbosa noted that blockchain technology has already demonstrated its value in various enterprise use cases, such as provenance tracking, logistics and cross-border payments. By providing efficiency and cost-saving solutions while saving time and labor, enterprise blockchain technology offers a reliable, secure source of data that enables businesses to reduce the cost of record keeping, automate business processes and increase efficiency.

Citing some real-world examples of how enterprise blockchain applications are already delivering value to businesses and consumers, Barbosa shared:  “Goldman Sachs recently arranged a 100 million euro two-year digital bond for the European Investment Bank with two other banks, all based on a permissioned blockchain. That is a significant milestone for the financial markets and enterprise-grade blockchain technology.” 

Although enterprise blockchain technology is transforming businesses and markets, Barbosa highlighted various risks and challenges involved in adopting enterprise blockchain and suggested ways to mitigate them. These challenges include a lack of complete comprehension of the technology’s advantages, use cases and its proper integration into business models and processes. Additionally, the expenses and time required for implementation and the complexities of onboarding all relevant participants have contributed to skepticism among consumers, businesses and the media about the role of blockchain in the business industry.

In the interview, Barbosa mentioned the impact of enterprise blockchain adoption on traditional financial institutions and how they can maintain competitiveness in a rapidly evolving landscape. According to Barbosa, enterprise blockchain technology provides the potential for decentralization, combined with distributed trust, which is a potent combination for financial institutions. 

Looking at the most promising future applications of enterprise blockchain technology and how they might transform global markets and industries, Barbosa shared two key applications that come to mind given the recent industry movement: the rise of central bank digital currencies (CBDCs) and the reduction of friction in our financial markets: “Today, 114 countries, representing over 95% of global GDP, are exploring CBDCs. [...] Governments are moving carefully, and goals range from modernizing payment processes to removing barriers and costs associated with back-end settlements to boosting financial inclusion.”

Bitcoin lacks active address growth and significant on-chain volume in a divergence from previous BTC price bull markets.

Research warns that Bitcoin  still lacks the on-chain volume and active address increases that characterize bull markets.

In a frank appraisal of the 2023 BTC price rebound, on-chain analytics platform CryptoQuant warned that Bitcoin might be weaker than it seems.

Active addresses not copying bull market paradigm

As on-chain metrics flip green and some even flash bull signals not seen in years, a healthy dose of suspicion remains among many analysts.

CryptoQuant contributor Yonsei_dent is among them, writing in one of the platform’s Quicktake blog posts this week that 2023 does not chime with previous bull markets.

The problem, he explains, lies in active addresses, which are not increasing in number despite BTC/USD gaining almost 50% year-to-date.

“Active Addresses is a metric that includes all addresses sending and receiving BTC, providing a look at how active market demand is,” the blog post reads. “The ‘price’ of an asset is determined by the laws of supply and demand in the market. Crypto markets are no exception. For asset prices to rise, market interest and demand must be supported.”

An accompanying chart shows the 30-day moving average (MA) of active addresses increasing following the end of the 2018 bear market and the March 2020 COVID-19 cross-market crash. 2023, by contrast, has yet to produce the same trend.

“You can see that Active Addresses (30DMA) increased both during the 2019 bull market turnaround and when coming out of the 2020 COVID-19 shock,” Yonsei_dent added. “I am concerned that this 2023 rally did not show any rise in Active Addresses.”

Bitcoin Active Addresses

Many transactions, not much volume

Other research produced similar conclusions about the Bitcoin investor habits, which have accompanied the return to $25,000. Analytics firm Glassnode notes that on-chain volume remains low, with both long-term holders (LTHs) and short-term holders (STHs) reluctant to spend. “Despite net growth in on-chain activity, and an ATH in total UTXOs, transfer volumes are remarkably subdued, both for Long and Short-Term Holders,” it wrote in the latest edition of its weekly newsletter, “The Week On-Chain.”

Bitcoin spent young coin volume annotated

There are some encouraging signs of improving sentiment, with coins sent to exchanges by LTHs now mostly in profit.

In mid-January, Glassnode shows 58% of LTH coins sent to exchanges were moved at a loss, while at the start of this week, the figure was just 21%.

itcoin relative long-term holder realized loss to exchange annotated

#Bitcoin #BitcoinPrice #Markets #glassnode

A globally distributed AI network that relies on mining rigs will be difficult for governments to control, according to Dr. Ben Goertzel.

As artificial intelligence (AI) rapidly works its complex magic on one sector of the economy after another, there is an increasingly pressing need for compute resources to power all this machine intelligence. 

Training a model like ChatGPT costs more than $5 million, and running the early ChatGPT demo, even before usage increased to its current level, costs OpenAI around $100,000 per day. And AI is more than just text generation; applying AI to practical problems across multiple industries requires similar large neural models trained on a diversity of data types — medical, financial, customer information, geospatial and so forth. Moving beyond the limitations of current neural net AI toward systems with higher levels of artificial general intelligence will almost surely be even more compute intensive.

It’s only natural that a small but increasing number of crypto miners are now looking at how to leverage their own compute infrastructures to help push forward the AI revolution.

Bitcoin mining remains a lucrative business. Mining other cryptocurrencies can still make money as well, but it is a rapidly shifting landscape. Ether miners, for instance, took a major hit late last year when the Ethereum network shifted from proof-of-work to proof-of-stake.

The economic and technical situation in the crypto space over the last two years has driven an increasing number of crypto mining organizations to explore the potential of leveraging their facilities for other purposes, such as high-performance computing and, in particular, AI.

The specific computing hardware needed for high-performance computing (HPC) or AI processing is often different from what’s optimal for crypto mining. But buying servers is generally not the most difficult part of setting up a mining farm. Getting the electrical power and cooling and security and other physical infrastructure in place is a major cost and effort, and all this remains roughly the same whether one is hosting RAM-light GPUs appropriate for ETH mining or RAM-heavy GPUS appropriate for AI model learning.

Mining firm Hut 8 has led the way, leveraging its formerly mining-dedicated compute facilities for machine learning and other HPC applications. Hive Blockchain has been doing the same thing for some time, filling its servers with processor cards that “can be used for cloud computing and AI applications, and rendering for engineering applications, in addition to scientific modelling of fluid dynamics.”

Mining firm Hut 8's stock price, Feb. 2022-Feb 2023.

Perhaps most interesting is the potential for miners to shift their compute resources to AI in a way that remains fully within the blockchain space — by using them to run AI processes that are hosted in decentralized blockchain-based networks. This opportunity is provided by a number of AI projects associated with their own altcoins, such as Fetch.ai (FET), Ocean (OCEAN) Matrix AI Network (MAN), Cortex (CTXC) and my own project, SingularityNET (AGIX), and its various ecosystem projects, such as NuNet (NTX) and the new ledgerless blockchain HyperCycle. AI-related altcoins have done well in the first part of 2023, as the market has come to understand the potential for decentralized AI software.

It’s been clear since before Bitcoin’s white paper that the fusion of distributed computing, strong encryption and decentralized control has broad applications beyond the financial. This is why we have blockchain projects in areas spanning nearly all vertical markets — medicine, supply chain, gaming, robotics and so on. As each of these business domains becomes dominated by AI, decentralizing the software and hardware underlying AI will be a critical aspect of decentralizing the global economy. Repurposing of a portion of crypto mining hardware to running AI processing, some of which is wrapped in AI-oriented crypto networks, will increasingly form part of the story.

If a non-trivial portion of global AI processing ends up being done on crypto mining facilities, this could have implications beyond finance. Crypto mining rigs are based in diverse legal jurisdictions and owned by a variety of different parties. A globally distributed AI network spread across crypto mining rigs would be dramatically more difficult for governments or other parties to centrally control than an AI network centered in Big Tech-owned server farms (the current default for AI). Whether this is good or bad AI ethics-wise depends on your estimate of the character of Big Tech and big government.

#Cryptocurrencies #Mining #Technology #Adoption #Hardware #Bitcoin Mining #AI #GPU

A supernet or umbrella network combines multiple smaller networks or blockchains into one larger network.

Supernets enable communication among distinct blockchain networks, considerably improving the usefulness of the overall system by enabling the transfer of assets and data among different blockchains.

Furthermore, shared infrastructure and resources can be made possible by interconnected networks, which can lower costs and boost overall effectiveness. By making assets accessible across numerous networks, they can significantly improve their liquidity, which will raise the assets’ value.

This article will discuss the concept of a supernet, how to implement supernetting, the advantages and disadvantages of supernetting, and how it’s different from a subnet.

What is a supernet?

A supernet, also known as a metanet, is a network of networks that allows interoperability and cross-communication among different blockchain networks. The idea behind a supernet is to create a decentralized network that allows different blockchain platforms to communicate and interact with one another without the need for a centralized intermediary, creating a unified ecosystem. Moreover, the effectiveness and speed of transactions and communications among various blockchains can be significantly increased as a result. 

A supernet also has the advantage of facilitating the development of new decentralized services and apps that can combine the strengths of many blockchains. This may create fresh opportunities for development and innovation in the blockchain industry. Cross-chain communication is another feature of supernet that enables chains to connect and transact with one another, increasing the value for users.

How does a supernet work?

To implement a supernet, various protocols and technologies, such as atomic swaps, cross-chain communication protocols and sidechains, are used. These technologies allow different blockchains to communicate and interact with one another and can be thought of as a kind of “bridge” between different networks.

Atomic swaps, sometimes referred to as atomic cross-chain trade, enable cryptocurrency trading without the use of centralized intermediaries. This is accomplished by developing a smart contract on one blockchain that encrypts the assets being traded, unlocks them once the trade is complete, and releases them on the other blockchain. This allows assets to be transferred between blockchains without the need for a centralized exchange. 

To enable communication and interaction across several blockchains, cross-chain communication protocols, such as Cosmos and Polkadot, are employed. These protocols enable the exchange of information and assets among many blockchains and the development of decentralized apps that can combine the advantages of various blockchains.

Another technology utilized in a supernet is sidechains. A sidechain is an additional blockchain that is connected to a main blockchain and permits the movement of assets between the two. This allows for greater scalability and privacy, as well as the ability to experiment with new technologies and consensus mechanisms without affecting the main blockchain.

How to supernet a network

A supernet, or network of networks, can be built using a variety of technologies and protocols, and it is a complicated process. Here is a general overview of the steps involved in creating a supernet:

Identify the networks to be connected

The process of building a supernet begins with identifying the various blockchain networks that are to be linked. To facilitate smooth communication and interaction, these networks should have identical protocols and objectives.

Implement atomic swaps

A crucial piece of technology to enable the transfer of assets among various blockchains, atomic swaps allow cross-chain trade among various blockchains.

Develop cross-chain communication protocols

Cross-chain communication protocols, such as Cosmos and other corresponding protocols, must be created to enable communication and interaction across various blockchains. These protocols enable the exchange of information and assets between several blockchains.

Create sidechains

A sidechain is a separate blockchain that runs parallel to a main blockchain and is connected to it through a two-way peg. This means that assets can be transferred from the main blockchain to the sidechain and vice versa. Each sidechain in a supernet has a specialized function, such as providing privacy and scalability or supporting particular assets.

Test and deploy

Once the supernet infrastructure is set up, it’s vital to test it thoroughly before deploying it. This step will help identify and fix any bugs or errors that may exist.

Promotion

The next stage once the supernet is set up is to promote the use of the brand-new infrastructure. Building a developer community, forming alliances with other initiatives, and putting in place rewards for people who join the network can all help achieve this.

The above steps offer a general overview of creating a supernet and the process can be complex and require different levels of expertise, depending on the specific use case.

How to identify a supernet address

A network address that is produced by fusing many network addresses is known as a supernet address. The process of identifying a supernet address is called supernetting or classless inter-domain routing (CIDR).

The following steps can be used to identify a supernet address:

Steps to identify a supernet address

For instance, let’s say there are two networks:

Two network to generate a supernet address

To supernet these two networks, one needs to find the largest network mask that can encompass both of them. In this case, the largest mask that would work is a /23 mask (255.255.254.0). The new network mass can be obtained by counting the shared leading bits in the network section of the addresses. This allows one to generate a supernet address by aggregating both networks into a single, larger network, which they can represent as:

Supernet address

This supernet can be used in place of the two individual networks, and any IP address within the range of the supernet will be routed to the correct destination network. Supernetting helps to reduce the number of routes in the routing table, making it easier for routers to manage network traffic and improving the efficiency of IP address usage. However, it is important to note that the process of supernetting requires a good understanding of internet protocol (IP) addressing and network subnetting.

Advantages of supernetting

CIDR is a technique used to create a supernet address by combining multiple network addresses. It has several advantages, including:

Efficient use of IP addresses: More effective use of IP addresses is made possible by supernetting, which joins several networks into a single supernet. This can aid in IP address conservation and prevent IP address depletion.

Improved routing efficiency: Supernetting can help minimize the number of entries in routing tables, which can lower the amount of memory and processing power needed to route traffic, resulting in improved routing efficiency.

Easier network management: Supernetting can make network management easier by reducing the number of networks that need to be managed and configured. This can help to simplify network administration and reduce the number of errors and misconfigurations.

Increased security: By lowering the number of computer networks and potential attack surfaces, supernetting can also improve security by making it more challenging for hackers to breach the network.

Interoperability: It is a central feature of the SuperNet network and is achieved through the use of sidechains and cross-chain atomic swaps. This allows users to manage and trade digital assets across different blockchains in a seamless and efficient manner.

Scalability: Supernetting enables the construction of networks that may be expanded or contracted as necessary to meet changing demands.

Despite the above advantages, supernetting should be done with caution, as it can also introduce new security risks if not done properly.

Disadvantages of supernetting

While supernetting, also known as CIDR, has many advantages, there are also some potential drawbacks to consider:

Complexity: It can be a challenging technique that necessitates a solid grasp of IP addressing and network subnetting to perform supernetting. Furthermore, it may necessitate the use of specialized software and hardware, increasing the cost and network complexity.

Security risks: If supernetting is done incorrectly, it can create new security problems. Combining several networks into a single supernet might increase the attack surface and make network security more challenging.

Compatibility issues: Supernetting can create compatibility issues with some network devices or software that may not support CIDR.

Increased complexity in routing: Supernetting can make it risky to find the proper path for packets, which can lead to an increase in routing complexity. Increased latency and poorer network performance may result from this.

Lack of granularity: Supernetting can make it more difficult to segment a network and create smaller, more secure subnets. Access control to particular network resources or devices may become more difficult as a result.

Limited scalability: Supernetting can limit scalability in the sense that it can create difficulties in adding new networks to the existing supernet.

However, the above drawbacks of supernetting can be mitigated by proper planning and execution and by using appropriate security measures to protect the network.

What is the difference between a subnet and supernet?

A smaller network, often called a subnet or subnetwork, is produced by segmenting a larger network into smaller, easier-to-manage networks. Subnetting divides a network into smaller, independent portions, improving structure and security. 

Each subnet can be established and managed independently, and it can have its own set of network addresses. In large networks, such as those used by businesses or organizations, subnetting is a typical practice. On the other hand, multiple networks are linked together to form a supernet, which enables them to interact and communicate with one another to form a single ecosystem.

Here is a summary of supernetting vs. subnetting:

Subnet versus Supernet

How to manage supernets

A thorough understanding of IP addressing and network subnetting is necessary for managing a supernet. Here are some general requirements for managing a supernet:

Develop a network plan

A thorough network strategy that specifies the goals and objectives of the network, as well as the particular requirements for each unique network that will be included in the supernet, must be created prior to the implementation of the supernet.

Establish governance

Establish clear lines of responsibility and decision-making processes for the supernet. This includes determining who will be responsible for managing the network, who will have access to it, and who will be able to make changes to the network’s configuration.

Train the staff

The supernet management team must possess the knowledge and abilities required to set up and run the network. They ought to receive instruction on how to use the particular technologies and protocols employed by the supernet.

Plan and implement network integration

Establish how the various networks will be connected to one another and how they will exchange resources as part of the bigger network integration. Then, install the required hardware and software to link the networks together and incorporate them into the supernet. This could comprise network management software, switches, routers and firewalls.

Use appropriate security measures

The use of proper security mechanisms, such as firewalls, intrusion detection, prevention systems and other security technologies, is essential to ensuring the network’s security.

Monitor and maintain the network

The network must be regularly monitored and maintained to ensure that it is operating effectively and that any problems are found and fixed quickly.

Use centralized management tools

Centralized management tools can help to simplify the management of the supernet by providing a single point of control for the entire network.

Keep the software updated

If the software is kept up to date, the network can be protected against known vulnerabilities and run the most recent security patches.

Document and troubleshoot

The network is easier to comprehend and administer with proper documentation and troubleshooting.

Test the network

Network testing on a regular basis might help find and fix any potential problems. Regular penetration testing and other security testing technologies can be used to accomplish this.

Overall, it is important to have a strong understanding of network infrastructure, security and management practices in order to effectively manage a supernet.

Crypto’s value increases with more users, creating a positive feedback loop due to the network effect.

The network effect is a phenomenon where the value of a product or service increases as more people use it. As the user base grows, there are more opportunities for interactions, which can lead to increased benefits and positive outcomes for each user.

The network effect is a powerful driver of growth and adoption for many technologies and platforms, including social media, messaging apps and marketplaces.

The network effect and cryptocurrencies

The network effect is also a central concept in the world of cryptocurrency. In general, it means that a cryptocurrency’s value rises as more people use it. This is because a larger user base results in higher liquidity and trading volume, which increases acceptance and utilization.

For instance, the enormous and expanding user base of the Bitcoin network creates a powerful network effect that has increased its market acceptability, liquidity and value. A self-reinforcing cycle develops when more people use Bitcoin because it becomes more valuable to each individual user as more people use it.

The success of cryptocurrencies is largely due to the network effect, which is one of the reasons why early adoption can be so important for long-term investment returns. However, it’s crucial to remember that the network effect is not a guarantee of success and that other factors can affect a cryptocurrency’s value and uptake, including technological developments, competition, news and market sentiment.

How the network effect impacts the adoption of NFTs

The network effect significantly impacts the value of nonfungible tokens (NFTs). NFTs become increasingly beneficial to each user as more individuals adopt and use them. With a larger user base comes more liquidity, demand and chances for purchasing and repurchasing NFTs.

It’s also easier for musicians, artists and producers to make money from selling NFTs as more people use them.

Nonetheless, it’s essential to note that the network effect is not the only factor that influences the adoption of NFTs. Other factors, such as ease of use, security and the quality of the underlying digital asset, can also impact the adoption of NFTs. Regardless, the network effect is a key driver of growth and adoption for NFTs, and it is likely to play an important role in future development.

The network effect in DeFi and Web3

The network effect creates a cycle of growth and adoption when users and activity on decentralized finance (DeFi) or Web3 apps and networks increases, ultimately raising the value and utility for all participants. 

For instance, decentralized exchanges (DEXs) like Uniswap and SushiSwap become more valuable as more users and liquidity providers join, leading to tighter spreads, deeper order books and better prices for traders.

Related: DeFi vs. Web3: Key differences explained

Similarly, NFT marketplaces like OpenSea and Rarible benefit from network effects as more creators and collectors join, leading to a wider variety of unique and valuable assets, higher trading volumes and more visibility for the platform.

Crypto launchpads allow new crypto projects to raise funds while giving investors first access to tokens. Here’s how they work.

In the world of cryptocurrency, joining projects early may be beneficial. For example, investors who bought Bitcoin in 2011 are now reaping the benefits of their investment. They discovered something new, saw its potential and stuck with it.

With cryptocurrency’s growing worldwide adoption comes a new fundraising platform: the crypto launchpad. Launchpads allow crypto investors to discover and invest in early-stage crypto projects before they are listed publicly. As a result, they can buy tokens for cheap and profit more when their value increases.

In recent years, crypto has enjoyed a significant rise in popularity despite market volatility which saw Bitcoin fall from $60,000 to around $35,000, Ether crashing 40%, and Dogecoin  falling 45%. The push for regulation has also been stepped up, with the Biden administration taking steps to regulate cryptocurrency.

Despite these events, interest in cryptocurrency remains at an all-time high. Investors and the general public are on the lookout for the next big thing, and crypto launchpads may offer the ideal platform.

Launchpads allow crypto project founders to build awareness and generate capital for their companies at a small price. Moreover, launchpads offer investors and founders a secure platform to discover and connect with each other.

What is a crypto launchpad?

A crypto launchpad, sometimes called a crypto incubator, is a decentralized exchange (DEX)-based platform where crypto projects are introduced and can obtain funding. Before being publicly listed, early-stage crypto token sales are made available to the project’s crypto investors.

Investors see this as a great chance to profit from a future price increase by buying tokens at low prices and selling them at a profit later on. Because the cost of launching is so minimal, the platform can also draw in more crypto projects for funding.

New founders also stand to gain from the platform, as they will have easier access to the pool of cryptocurrency investors and fans waiting for the next exciting venture.

In 2021, at the bull market’s peak, many new coins and projects were launched, with investors pouring money into them. However, some were scams, and many lost money since they didn’t have the proper skills or time to screen the projects.

In contrast, trusted crypto launchpads perform due diligence on behalf of users and investors, which is another reason for their growing popularity. New projects undergo a stringent screening process, with a third party enlisted to conduct Know Your Customer (KYC) verification on new users, helping to protect both founders and investors.

How does a crypto launchpad work?

Crypto launchpad platforms exist to connect cryptocurrency projects and interested communities. Launchpads help founders raise money from potential users and investors and give investors a chance to maximize their return on investment.

Transparency and security are two key features that attract investors. Users who create a new account will typically be subjected to a KYC process to verify their identity. This procedure also makes it harder for someone to manipulate the system by making transactions using several aliases.

Each crypto launchpad will have its own set of handpicked cryptocurrency projects and their current status. Interested investors should be able to access important information about these projects, such as the price and start date. Investors will also be able to purchase specific tokens once their sale starts.

Token sales on crypto launchpads are similar to blockchains in that they provide transparency and make it easy to track the distribution method for each token. This makes it possible for retail investors to invest in early-stage tokens. It further encourages an even distribution of tokens among investors and discourages “pump-and-dump” tactics.

What are the benefits of crypto launchpads?

Launchpads are advantageous for bringing cryptocurrency projects and investors together. Among the other benefits are the following:

Low fees: Some launchpads only charge a nominal fee, while others don’t charge anything for listings. Some launchpads make it quick and easy to start a project by lowering the barriers to entry.

Security: Launchpads vet both users and projects thoroughly, safeguarding everyone involved. It’s also unlikely that a breach would occur because investors have absolute ownership of their assets, and launchpads do not store user funds.

No waiting period: Tokens are available immediately after purchase without needing a processing period.

How to use crypto launchpads

The following are some general steps; however, they may differ slightly depending on the crypto launchpad they use:

Steps to use crypto launchpads

Types of crypto launchpads

Initial DEX offering (IDO) launchpads

IDO launchpads are decentralized platforms for crowdfunding. Tokens that represent assets hosted on a DEX are traded here. Some known IDO launchpads are FireStarter, BSCPad, GameFi, Seedify and TrustPad.

Initial NFT offering (INO) launchpads

INO launchpads allow investors to fund projects in which a collection, or collections, of nonfungible tokens (NFTs) are offered for sale on the platform. A few INO launchpads are Only1, BSCStation and Seedify.

Initial coin offering (ICO) launchpads

ICO launchpads allow founders to raise funds to finish developing their blockchain projects by offering tokens to investors. Investors will put money into promising projects, hoping for a significant return. Well-known ICO launchpads include CardStarter, Binance Launchpad and Polkastarter.

Initial game offering (IGO) launchpads

IGO launchpads are platforms where game and metaverse developers can get funding for their projects. These launchpads host IGOs, play-to-earn projects, gaming utilities and related NFTs. Some examples of IGO launchpads are Gamestarter, Enjinstarter and PlayPad.

Characteristics of a good crypto launchpad

Before investing in or launching a cryptocurrency project, it is important to do some research on the right launchpad.

For investors 

For investors who want assurance that these projects are safe, profitable and will earn a good return on investment, it’s vital to check the launchpad’s commitment to security. The platform should follow strict security protocols, use KYC checks and take other steps to safeguard personal information.

The minimum staking amount and perks associated with each launchpad will vary, so careful analysis is needed before deciding.

For founders

Founders interested in launching their project through a crypto launchpad should assess how well the platform promotes related projects and whether or not the community is supportive. In addition, it is essential to check the project vetting process, the criteria, and how fair and realistic the launchpad’s terms are.

A supportive community can be of great benefit since other members can help market projects to users and potential backers.

The future of crypto launchpads

Crypto launchpads are new platforms designed to help facilitate the funding of crypto projects. They aim to alleviate growing distrust surrounding cryptocurrencies and increase investor confidence.

By rejecting scammers and promoting legitimate crypto projects, launchpads help to improve the market and provide investors with a sense of security, which is advantageous for investors and founders. For investors, it helps to lower the risks while giving founders additional opportunities to market their projects.

As a bonus, regular investors can now access investments formerly reserved for institutional investors and venture capitalists. The development of crypto launchpads should make cryptocurrency investment easier and safer. And with more investors, it is hoped that the cryptocurrency industry will continue to grow.

Discover the top 11 greatest investors of all time who have achieved unparalleled success in the financial world.

Learning from the greatest investors of all time can provide valuable insights into successful investment strategies and philosophies. Their success stories and experiences can inspire and guide new investors. Studying their methods can help individuals develop their own investment approach and improve their chances of achieving success in the financial world.

Here are the top 11 investors of all time. Learn about the investment strategies and philosophies that have made these individuals some of the most successful investors in history.

Warren Buffett

Warren Buffett, chairman and CEO of Berkshire Hathaway, is known as the “Oracle of Omaha,” has a net worth of over $108 billion, and is widely considered the most successful investor of the 20th century, with a long-term, value investing approach. Being a value investor means that he looks for companies that are undervalued by the market.

Buffett believes in keeping onto his investments for a long time since he is a long-term investor. He has famously said, “Our favorite holding period is forever.” He looks for companies with a “moat, which is a sustainable competitive advantage that makes it difficult for other companies to compete.

George Soros

Founder of Soros Fund Management, known for his aggressive currency speculation and “breaking the Bank of England” trade in 1992, Soros has a net worth of $8.6 billion and is known for his philanthropic work and political activism.

Reflexivity, which is the notion that market conditions are influenced by both subjective perceptions and interpretations of that reality as well as by actual fact, is one of Soros’ key investment principles. This means that biases and cognitive limitations among market players may skew how they perceive the market, creating feedback loops that may intensify current market trends. According to Soros, investors can better predict and profit from market swings by understanding the reflexive nature of markets. 

Additionally, he promotes the concept of “margin of safety,” which holds that investors should only buy assets that are substantially undervalued in comparison to their real value. This reduces the possibility of substantial losses for investors, especially in the face of unforeseen circumstances or market unrest.

Peter Lynch

Former manager of the Fidelity Magellan Fund, Lynch is widely regarded as one of the most successful mutual fund managers of all time, with an annualized return of 29.2% from 1977 to 1990.

One of Peter Lynch’s key investment principles is to “invest in what you know.” Lynch believes that because individuals can spot investment possibilities in their daily lives, individual investors have an advantage over institutional ones. Individual investors might spot prospective investment possibilities that others might pass up by keeping an eye on the businesses and products they use and are familiar with.

Benjamin Graham

Known as the “father of value investing,” Graham authored the seminal investment book, The Intelligent Investor, and mentored Warren Buffett.

Value investing, which entails purchasing stocks that are currently trading at a discount to their intrinsic value, is the cornerstone of Graham’s investment philosophy. Graham thought that rather than paying attention to short-term market fluctuations, investors should concentrate on a company’s fundamentals, such as its management, financials and competitive position.

John Paulson

John Paulson, founder of Paulson & Co., is known for his $15-billion bet against the U.S. housing market in 2007, which netted him $4 billion and went down as one of the largest trades in financial history.

Paulson is a hedge fund manager known for his investment philosophy of making concentrated bets on macroeconomic trends. He believes in using in-depth research to identify mispricings in the market and using derivatives to amplify returns. He also focuses on investing in undervalued companies with strong fundamentals.

Ray Dalio

The founder of Bridgewater Associates, Ray Dalio is the head of one of the world’s largest hedge funds and is known for his “Principles” approach to management, which has been adopted by many successful investors and businesses.

Dalio is a hedge fund manager known for his investment philosophy of “radical transparency” and “principles-based” decision-making. He supports fostering an environment in which everyone is encouraged to express their ideas and opinions in an open and honest manner. To make better decisions in the future, Dalio also thinks that a set of guiding principles should be established. His investment strategy is centered on macroeconomic trend identification, risk management and diversification.

Carl Icahn

Founder of Icahn Enterprises and known for his activist investing approach, Carl Icahn has made significant investments in companies such as TWA, Texaco and Blockbuster and has a net worth of over $16 billion.

Icahn’s investment philosophy involves taking large stakes in undervalued companies and using his influence as a shareholder to push for changes that will unlock value for investors. He is known for his aggressive style and willingness to engage in proxy battles to push for changes in company management and strategy.

Jesse Livermore

Considered a pioneer in technical analysis, Jesse Livermore is known for his successful bets on the 1929 stock market crash and the 1907 Panic.

Livermore’s approach to investing included placing bets based on market movements, utilizing technical analysis to spot market trends, and adhering to tight risk management guidelines. He had a reputation for being able to predict market changes and place successful transactions based on his analyses.

David Einhorn

Founder of Greenlight Capital and known for his short-selling approach and successful bets against Lehman Brothers and Allied Capital, David Einhorn has a net worth of over $1 billion.

Einhorn’s investment style involves finding mispricings in the market through in-depth research and using a value-oriented approach to investing. He is known for his ability to identify companies with undervalued assets or growth potential and take a long-term perspective on his investments.

Jim Simons

Founder of Renaissance Technologies and known for his use of quantitative trading strategies, Jim Simons has a net worth of over $25 billion and is a prominent philanthropist. Simons’ investment strategy involves using mathematical models and quantitative analysis to identify patterns and generate trading signals.

Philip Fisher

Known for his “scuttlebutt” approach to investing, Fisher authored the influential investment book Common Stocks and Uncommon Profits and mentored many successful investors, including Warren Buffett.

He believed that the ideal way to find businesses with long-term growth possibilities is to perform an in-depth study of their management, industry position and competitive advantages. Fisher also underlined the value of making investments in businesses that have a strong focus on innovation and research and development.

Monetizing digital art with NFTs provides proof of ownership, increased value and potential for royalties.

Nonfungible tokens (NFTs) offer a new way to sell and distribute digital art, and they have the potential to unlock new revenue streams for artists in the digital age. Here are five ways to monetize your digital art with NFTs.

Fractionalized ownership

This involves splitting the ownership of an artwork into smaller parts and selling them as tokens, allowing multiple investors to own a stake in the artwork. For example, an artist can create 100 tokens for a piece of art and sell them to 100 different buyers, each of whom owns a share of the artwork.

Dynamic NFTs

Dynamic NFTs are a type of NFT that changes over time, creating a unique and evolving experience for the owner. Dynamic NFTs can use external data sources to update the artwork, such as social media feeds or actual occurrences. 

For example, “The Eternal Pump” is a dynamic NFT that changes in response to the rise and fall of the cryptocurrency market. The artwork gets more complex and elaborate as the value of cryptocurrencies rises, while it gets more straightforward and abstract as their value falls. Because they allow viewers to follow changes to the artwork and see it develop over time, dynamic NFTs can bring a new degree of involvement and engagement to collectors.

Dynamic NFTs can be monetized via auction, where collectors can bid on them, and the highest bidder takes ownership. Dynamic NFTs that are highly sought after, due to their unique features and evolving nature, can command high prices at auction. Additionally, using subscription-based systems, artists can offer collectors exclusive dynamic NFTs for a fee. These NFTs might vary frequently, offering subscribers a steady stream of fresh content.

Royalties

NFTs can be programmed to automatically pay the artist a percentage of the sale each time the NFT is resold on a secondary market. This allows artists to continue to profit from their work even after the initial sale. For example, the digital artist Pak sold an NFT called “The Fungible” for $502,000, and the NFT was automated to pay the artist a 10% royalty on every subsequent sale. Since then, the NFT has been resold multiple times, and the artist has earned over $2 million in royalties.

Gamification

This involves creating interactive nonfungible tokens that users can play with or use in games. For example, Axie Infinity is a game that uses NFTs as game assets, with players able to buy, sell and trade them to build their game characters.

In addition, NFTs can be given as rewards for achieving particular goals or activities in a game or app. For instance, a fitness app may offer nonfungible tokens to users who reach their daily workout targets.

Physical asset tie-ins

Physical asset tie-ins with NFTs involve linking a physical object to a unique digital asset, typically using a unique identifier or code. This can provide a way to verify the authenticity and ownership of the physical object, while also allowing for the transfer of ownership and value of the associated digital asset.

That said, an NFT can be used to represent ownership of a physical asset, such as a piece of real estate or a car. For instance, a company called CarForce is developing NFTs that reflect ownership of high-end automobiles, with the NFT serving as a digital car key that permits the owner to enter and operate the actual automobile. 

Pharmacy visitors expect quick service - to have their prescription filled quickly, or over-the-counter remedy purchased in just a few minutes. In this rapid interaction, little thought goes to the journey of that medicine from a microscope slide to mass production. 

In reality, the drug discovery process is incredibly time and research-intensive. Despite significant advancements in manufacturing and discovery, the average time to bring a drug from the initial stage to market is 10-15 years and costs millions of dollars.

Emerging technologies are transforming healthcare and drug discovery. Artificial intelligence, for example, is doing the “dirty work” of drug discovery by running simulations of drug efficacy instead of timely trial-and-error testing. Blockchain secures healthcare records and connects patients with new clinical trials. AR and VR tools help patients overcome phobias and fear during medical treatments. AI will help future drugs reach the market (some believe this can be cut down to just five years!), delivering life-changing results for illness sufferers worldwide. 

The biggest obstacle to achieving these changes and this tech going mainstream? Us, the patients. We all need to understand the power and promise of these technologies and push for them - or, at least, not fear them.

Supporting AI and blockchain in the healthcare sector

There’s a popular image going around on social media that reads, “AI will not replace jobs. People using AI will replace people’s jobs.” With its easy-to-use interface, ChatGPT is showing people how AI might look in our day-to-day lives. One thing you probably can’t ask the chatbot for? A new compound for a pill to cure deadly diseases. And that’s good because AI applications in medicine should be managed by professionals.

These professionals have known about the power of AI for years, working behind the scenes to develop real use cases. Insilico Medicine brought its knowledge into the spotlight when it announced its “sixth-generation” robotics laboratory in early January. Sixth-gen status means the lab is fully automated, with robotics and AI algorithms conducting ​​target discovery, compound screening, precision medicine development, and translational research. 

You may be wondering, what does fully automated mean for the scientists previously doing these jobs at Insilico? It’s just as the image I mentioned earlier suggests: by integrating technology and speeding up processes, researchers can focus on the “human” side of their work. They are free to focus on critical tasks like clinical trial development and side effect studies because they know technology handles the rest. Ask anyone in biotech: AI is now foundational to drug discovery,

AI-native Insilico Medicine is no stranger to this emerging tech. In 2019, the company partnered with clinical trial startup Longenesis and a South Korean medical center to create a blockchain-powered health data management tool. They designed the platform to protect patient information and comply with guidelines like the Health Insurance Portability and Accountability Act (HIPAA) and General Data Protection Regulation (GDPR). Patients may have known these guidelines existed but did not understand how to manage their data effectively. In contrast, blockchain technology brings these regulations to life, empowering patients to manage their privacy and monitor their data. That’s where the future of health tech lies, at patients’ fingertips. 

Calling all patients: Healthcare transformation is in your hands

One of the lasting takeaways from COVID-19 was how crisis catalyzes breakthroughs. When faced with a common threat, scientific collaboration was not just a feel-good initiative–it was a dire mandate. The results were astonishing and historic. Scientists from around the globe used existing research to produce a vaccine in just a year, remarkably faster than the typical 5-10 year vaccine development timeline. 

The breakthroughs continued after vaccine distribution. Scientists today are applying the mRNA technology used in COVID jabs to develop new vaccines. Their targets? Devastating and hard-to-treat diseases like colorectal cancers and Lyme. AI and other technologies will help accelerate this process and propel this innovation forward, supporting researchers to change (and save) lives. 

2020 also taught us that public health matters for everyone. The onslaught of COVID brought concepts like mRNA and cytokine storms into daily life as people tuned into news reports and scientific publications to stay informed. This trend needs to continue. We have a responsibility to stay educated about healthcare breakthroughs as they impact us immeasurably. I cannot stress this enough: to take advantage of the future of medicine, you need to keep an open mind. 

I have complete faith in the crypto community to take this to heart. We’ve seen the technology behind Bitcoin redefine the digital art world with NFTs. We’ve witnessed DAOs revamp how teams manage projects. We’ve raised money for the world’s most important causes using decentralized tech. Now, it’s time for us to explore the next frontier of health. Scientists are building a future where AI-discovered medicines, virtual appointments and psychedelic mental health treatments will be the norm. Are you ready to be part of it?

The scientific community came together before to deliver life-changing research, and it is time for us to rally again in support of a more digital future of health. I encourage you to donate to research organizations, get smart on health tech and explore what artificial intelligence and personalized medicine could mean for your personal care. Resources are available across the web, and joining communities like nonprofits, DAOs and Discord chats is a great place to get started. In conclusion: technology can and will transform our health. It’s up to us to bring this transformation to life.

Discover 10 emerging technologies in computer science that are set to shape the future, including quantum computing, extended reality and robotics.

Technology is a powerful force that has significantly influenced the future. It has enriched our lives in innumerable ways, from boosting productivity and efficiency to bridging geographical distances. Artificial intelligence (AI), machine learning (ML), robotics and 5G networks are reshaping industries, opening up new applications, and altering our way of life.

For instance, precision medicine is enabling patient-specific therapies, and driverless vehicles promise to decrease traffic accidents and increase mobility. However, technology poses new problems such as employment displacement and cybersecurity concerns, but with good planning and management, technology can continue to advance and help create a better future for everyone.

Here are 10 emerging technologies in computer science that will influence the future.

Artificial intelligence and machine learning

AI and ML are changing the way people interact with technology. They’re driving automation, creating intelligent systems, and enabling new applications in fields such as healthcare, finance and transportation.

Moreover, artificial intelligence and machine learning can be used on blockchains for various purposes, such as fraud detection, risk assessment and predictive analytics. AI and ML algorithms can analyze large amounts of blockchain data to detect suspicious activity and anomalies and make predictions about future trends. They can also be used to automate certain processes, such as smart contract execution and asset management.

Quantum computing

The promise of quantum computers is that they will be able to tackle issues that traditional computers cannot. They use quantum bits (qubits) to carry out calculations concurrently and exponentially more quickly than conventional computers.

One potential use case of quantum computers is in the field of cryptography, where they could be used to break certain types of encryption that are currently considered secure on classical computers. It is because quantum computers are capable of doing some calculations significantly faster than conventional computers.

Blockchain technology

Blockchain technology’s primary use case is the creation of decentralized and secure digital records that can be used for various purposes. One of the most well-known applications of blockchain technology is in the creation of cryptocurrencies like Bitcoin, which are digital assets that can be used as a medium of exchange

As blockchains provide trustless and decentralized systems, they enable secure and more effective transactions, particularly in banking, healthcare and supply chain management.

Internet of Things (IoT)

IoT refers to the process of connecting physical objects to the internet so they can communicate and collect data. It has applications in fields such as manufacturing and healthcare and can be found in smart homes and wearable technology.

Biometrics

Biometrics involves the use of physical or behavioral characteristics, such as fingerprints or facial recognition, for identification and authentication. It has potential applications in areas like banking, healthcare, metaverses and law enforcement.

5G networks

The next generation of wireless networks, or 5G networks, offers higher speed and reduced latency than 4G networks. They have the potential to enable new applications like remote surgery and smart transportation systems.

Augmented reality (AR) and virtual reality (VR)

Augmented reality and virtual reality have the potential to enhance the user experience in various fields, including gaming, education, training and entertainment. Users can interact with digital things in the actual world using AR technology, for instance, and can completely immerse themselves in a virtual environment using VR technology.

AR and VR can be applied to improve customer contact and engagement with goods and services. For example, AR can be used in the retail sector to create virtual product displays, while VR can be utilized in the travel sector to generate virtual tours of locations.

Edge computing

Instead of delivering data to a central server, edge computing processes it at the network’s edge. This makes it ideal for applications like self-driving cars and smart cities because it can result in quicker processing times and less network congestion.

Edge computing is well-suited for self-driving cars because it allows for real-time processing of the vast amounts of data generated by the car’s sensors and cameras. It can process this data locally, at the “edge” of the network, allowing the car to make faster and more accurate decisions, improving safety and reliability. Additionally, edge computing can enable self-driving cars to function even in areas with poor connectivity because it can operate independently of the cloud. 

Extended reality (XR)

XR, which encompasses virtual, augmented and mixed reality technologies, has the potential to shape the future of work in several ways:

Remote collaboration: Remote collaboration is made easier with the use of XR technology, even when team members are located far. Remote teams can collaborate in a shared virtual workspace using virtual reality and augmented reality, which offers a more immersive experience than video conferencing.

Training and education: XR can be utilized to create immersive learning environments that let students hone their abilities in a secure setting. This can be especially helpful in industries like manufacturing or medicine, where VR and AR can be used to imitate operations and provide on-the-job training, respectively.

Design and prototyping: XR technology can also be used for product design and prototyping. For instance, virtual prototypes can be made with VR, enabling designers to view and test their concepts in a 3D environment.

Customer engagement: More immersive experiences for customers can also be offered through XR. While VR can be used to offer virtual tours of real estate properties or travel locations, AR can be utilized to create interactive product displays.

Accessibility: XR technology can make certain work experiences more accessible to people with disabilities. For those who are unable to travel du to physical restrictions, VR can be used to create virtual travel experiences.

Robotics

Robotics involves the design, construction and operation of robots that can perform tasks autonomously or with human guidance. Although robotics has been employed in manufacturing and logistics, it has potential uses in industries, including healthcare, agriculture and exploration. 

The use of autonomous drones for crop monitoring and management is one example of how robotics is used in agriculture. These drones may be fitted with cameras and sensors to gather data on crops, such as growth rates, soil moisture content and plant health. 

Machine learning algorithms can then be used to examine this data in order to improve crop management techniques like the application of fertilizer and pesticides. Drones can also be used to plant and harvest crops, lowering the demand for manual labor and boosting productivity. Overall, robots have the promise of enhancing agricultural production and sustainability while decreasing costs and raising yields.

Blockchain technology — including zero-knowledge proofs — doesn’t yet provide adequate solutions for identity verification.

The emergence of blockchain technology presents an opportunity to reexamine and innovate solutions used in our day-to-day life. Blockchains and, broadly speaking, the digital space fuelled by an artificial intelligence revolution urgently need to establish verifiable human identities to ensure trust, accountability and regulatory compliance.

There are a variety of emerging technologies, both on- and off-chain, that could serve as the basis for a functioning trust framework. One solution, in particular, is often referred to as the holy grail of verifications — zero-knowledge Know Your Customer (zkKYC) verification.

What are zk and KYC?

ZK stands for zero-knowledge, a cryptography term used to create cryptographic proofs without revealing the underlying confidential information. Z-based solutions are pioneering privacy across the web. The blockchain industry fueled the innovation of ZK technologies due to their minimal transaction size and privacy-preserving nature.

Know Your Customer, or KYC, is a set of processes and procedures businesses use to verify their customers’ identities. It is also used in the financial sector to assess any potential risks for money laundering or terrorism financing. It is a requirement for businesses to diligently understand their customers before establishing a relationship with them.

Why zkKYC proofs will not work for blockchains

Zero-knowledge proofs, when created, are linked to a wallet address through a signature. These proofs are not publicly discoverable by design. Yet when a blockchain address interacts with a public smart contract that requires such a proof, the proof’s existence becomes public, negating the privacy benefits of a zero-knowledge proof. It is due to the design of smart contracts running on public blockchains that create a publicly discoverable list of all interacting wallets.

A wallet with zero-knowledge proof that does not interact with an on-chain service that requires such a proof avoids the public disclosure of the proof. Yet this wallet can only transact with another proof-holding wallet following a precursor interaction or the involvement of an intermediary. The hidden nature of these proofs requires both wallets to reveal their proofs to one another proactively.

zero knowledge proof based

Another issue with zero-knowledge credentials that are prone to change status over time (such as a Know Your Customer good standing) arises from the lack of dynamic updates in available ZK solutions. This absence of continuous status validity necessitates that the wallet holding a zero-knowledge proof will be required to produce a new proof for every on-chain interaction where this proof is required.

It is worth noting that emerging blockchain technologies advance zero-knowledge-enabled smart contracts, keeping the interacting wallet address private. However, the issues around the need for dynamic proofs and the inability for verified-to-verified peer-to-peer transactions remain relevant even with these advanced solutions.

Do not store personal information in a proof

Projects considering zero-knowledge proofs often contemplate producing these proofs about encrypted data stored on a public ledger. However, it is ill-advised to store any personal information on a public blockchain.

These eternal ledgers are not designed for personal privacy, and for such use, they are not compliant with privacy regulations such as the General Data Protection Regulation and California Consumer Privacy Act. A few significant issues relate to the fact that even encrypted data is considered personally identifiable information. Any such information must be deleted upon request according to these privacy regulations.

Because storing personal information on a blockchain furthers non-compliance with privacy regulations, it is not an ideal solution for storing any form of (verified) personal information on-chain.

What other solutions do blockchain projects have?

Due to the limitations that each blockchain is limited to information and data available on that given chain, builders in the space must consider other blockchain native mechanisms. Any credential design that provides a form of compliance must avoid privacy violations and ensure that the final infrastructure meets the necessary identity verification and regulatory requirements. Technology advancements far outpace regulatory progress; however, disregarding these rules hinders the technology’s adoption.

In addition, when proofs alone are insufficient, and personal information sharing between the participants of a transaction is essential, relying only on off-chain solutions is advised. One example includes decentralized identifiers and verifiable credentials. Another option is to employ off-chain zero-knowledge proofs, which provide privacy protection and are suitable for off-chain data verification.

1. Why should businesses adopt nonfungible tokens in their supply chains?

NFTs can be used in supply chains to make them more transparent and efficient, leading to several billion dollars being saved. This is yet another space where Web3 technologies can have real-world applications.

The supply chain is an integral part of any business. Right from pharmaceutical giants and fast-moving consumer goods (FMCG) behemoths to local direct-to-customer brands, most businesses are dependent on efficient and resilient supply chains to deliver their products and services effectively. Despite being a vital cog in the wheel for organizations, supply chain networks are far from efficient on a global scale. 

One of the key applications of blockchain technology has been traceability in a supply chain. This feature of the technology has been experimented with in trade finance use cases by banks such as HSBC. This is a use case that relies more on smart contracts and blockchain infrastructure layers like the Ethereum and Solana blockchains.

While nonfungible tokens (NFTs) as a technology paradigm were not necessarily planned to disrupt supply chains, they can bring about a massive transformation of pain points in this space. NFTs can act as “digital twins” of real-world goods and can help traceability within supply chains.

Here are a few numbers, statistics and narratives to put things into perspective.

49% of businesses have zero knowledge of what’s happening at key touchpoints in their supply chain due to a lack of visibility.

Counterfeiting goods cost global brands more than $232 billion in 2018.

In industries such as pharmaceuticals, the counterfeit market alone could be close to $200 billion per year.

The scale of the problem can be understood from the numbers above, and NFTs can offer solutions to these inefficiencies. Adding to this, there are also other interesting use cases that lie at the convergence of blockchain and supply chain, which is discussed later in this article. 

2. What role do NFTs play in the supply chains?

Real-time tracking, settlement and documentation of the supply chain cannot only create more efficiencies for businesses but also help with better financial products that they can rely on for their operating capital.

NFTs create a digital record that is immutable and transparent. What this offers the supply chain industry is a transparent trail where everyone in the ecosystem would have complete visibility. Therefore, right from producing the raw material for goods to displaying them on a website or brick-and-mortar shop, the usage of NFTs will provide traceability and help in supply chain management.

Phygital NFTs have proven to be a great utility when they are tagged to real-world goods. Using NFTs for tracing a good or a manufactured product right to its source can add credibility to the product. It can also offer consumers a method to understand the source of the product they are looking at and choose one based on the providence of the product.

Apart from traceability, NFT-gated procurement and NFT-gated warehousing will help data scientists with valuable insights into product journeys at an individual level. Such granular data will help analysts, business owners and investors assess inefficiencies in the supply chain. This will help set new service level agreements (SLAs) with service providers on the supply chain and monitor them to hit these SLAs.

Furthermore, weaving NFTs and digital twin technology into the supply chain will enable companies to automate payments through the system and perform instant settlement once goods are delivered. Multiple checks and balances before transferring payment for finance teams would be a thing of the past once real-time traceability is enabled. 

Real-time tracking will also help financing products like trade finance, where the status of goods can be used to borrow working capital by stakeholders on the supply chain. Supply chain managers who have an enhanced vantage point can intervene at the right checkpoint in the event of congestion or bottlenecks. This makes supply chains more efficient, resulting in better revenues and lower costs. 

3. What are the advantages of using NFTs in the supply chain from a customer perspective?

Customers can see where products come from and the various routes they take before arriving at supermarkets.

Last but not the least, the end-consumer will get access to the evolution of a product. They have transparency on where the raw materials were produced and the companies that were involved in the production. This offers another dimension from a customer experience perspective bringing creators of products closer to the end-user. 

In the FMCG, pharmaceuticals and sectors where expiry and counterfeiting are a major hassle and could potentially lead to catastrophic consequences, NFTs can be a lifesaver. Along with that, the trust factor in brands also increases among customers. Apart from the primary benefits, NFTs can help make supply chains more sustainable, which in turn can help the environmental, social and governance (ESG) narrative of businesses.

As nation-states, central banks and the markets demand more sustainable practices from global businesses, ensuring a transparent and efficient supply chain can help firms with their ESG narrative. Should a company wish to weave sustainable practices into its supply chain, carbon efficiencies achieved through the use of NFTs could be a great value add. For the new age-conscious consumer, this means sustainable products, and for the globe, it means lower emissions. 

4. Which companies are using blockchain for supply chain management?

Several luxury and logistics brands use blockchain technology and NFTs to track their products and create digital twins that can help with community-building initiatives.

Major marquee brands in the auto, luxury and retail industries have already started integrating NFTs into their supply chain to obtain the innumerable benefits they offer. 

Walmart utilizes digital twin technology to track the food supply chain ecosystem, increasing trust. Automobile giant Ford uses digital ledger technology to ensure it gets ethical minerals for production. 

The diamond behemoth De Beers also uses blockchain to validate whether diamonds are sourced from war-free zones. Along with this, transportation companies such as FedEx and Maersk use this technology for their operations.

Luxury brands such as DeBeers, Louis Vuitton, Dolce and Gabbana, and Gucci have turned to NFTs for customer integration and loyalty. As nonfungible tokens act as digital twins of real-world goods, they not only offer transparent supply chains but also greater community retention through customer experience.

5. What are the real-world challenges of implementing NFTs at scale across supply chains?

Technology is often only a means to an end and is seldom a silver bullet. There are several real-world issues that can hinder progress with rolling out NFTs and blockchains across supply chains globally.

The benefits of digital twins for real-world goods can’t be underestimated. However, today’s supply chains globally are extremely intermediated and run on trust. A farmer in Africa sells their produce to an intermediary as they have for years. This develops a certain amount of trust between the two parties. 

As a result, resistance to change would be high, even when the farmer realizes that they will accrue value better in a more transparent supply chain. On the other hand, the intermediary wouldn’t want a new system, as their livelihood relies on the margins they make using the farmers’ produce.

Consequently, supply chains are susceptible to resistance from various stakeholders to such implementation. Drug supply chains could become extremely efficient with nonfungible tokens and blockchains. Yet the industry thrives in countries such as India and Nigeria, and corrupt stakeholders across the supply chain would be opposed if a new system is proposed.

Therefore, any technology being introduced into these supply chains will need to have both a top-down approach and a bottom-up approach. The top-down approach will involve governments and regulators mandating better traceability; the bottom-up approach would be firms solving this issue by working on the ground with stakeholders and spreading awareness of the benefits of the technology.