Stephane De Baets Owns the St. Regis Aspen Resort, and You Can Too: Enter Tokenization

Stephane De Baets visualizes a future where every asset, whether a small business or property, can be tokenized and sold on the blockchain– and he’s putting his tokens where his mouth is. 

Stephane is a Belgian-born real estate, hospitality, and investment entrepreneur with a penchant for standing out in each respective industry. As the Founder and President of Elevated Returns, an international asset management firm, Stephane launched the first major tokenized commercial real estate auction to sell a portion of his ownership stake in one of his properties– the idyllic Aspen St. Regis Resort in Aspen, Colorado. Stephane is also the Founder and Owner of Chefs Club, a restaurant group with a rotating residency of world-class chefs at its locations in Aspen and New York City. 

Stephane De Baets in a pool, courtesy of https://twitter.com/stephanedebaets

Stephane believes the tokenization of the St. Regis will lead to an avalanche of interest from real estate developers and mainstream investors into the blockchain industry. As a self-described “ultra-conservative old man in capital markets,” Stephane posits that his colleagues just need to see tangible proof of tokenized assets in action to see the value of allocating capital to blockchain-based investments. 

“Blockchain is about giving people the tools to do something that was restricted to a few selected individuals,” says Stephane. “Blockchain is a similar evolution as going from fax to email– was for communication. It made it easier and more efficient. People started finding new applications for communication through email, and then SMS.”

Stephane’s decade-long journey into blockchain isn’t just about making more money– there’s a rebellious element to his investment philosophy. Stealing fire from the gods and democratizing access for the masses is a sentiment not unfamiliar to those in the cryptocurrency industry. In Stephane’s case, this prodigal fire is the ability to invest in projects generally outside the purview of the ordinary investor. At the heart of Stephane’s key message is the disintermediation of the finance industry and creating a direct path for the creation and sharing of value between businesses and their customers.

“At  Elevated Returns, we think the current world is too elitist,” says Stephane. “Access to capital is limited to a very few privileged individuals. Giving access to this upper echelon of investing on a democratic basis, a la tokenization, would go a long way towards promoting equality. It’s not normal that five companies control an amount of wealth that is greater than the rest of the NASDAQ 100 combined. I think tokenization is low hanging fruit. I have a great deal of trust and conviction that sooner or later, there will be a great disintermediation that takes place no matter what, and the people should be ahead of it.”

The St. Regis Aspen, the hotel that the AspenDigital tokens represent partial ownership of.

Editor’s note: The following article is written as educational and informational, and is not to be construed as an endorsement, sponsorship, or investment advice for any of the entities discussed within. Cryptocurrency is an inherently very risky asset class, and always do your own research and consult a licensed financial advisor before making any investment or purchase. 


Luxury Real Estate 101: A Walk Through with Stephane De Baets

Stephane walks us through the traditional process for luxury real estate entrepreneurship. 

“If you want to own a hotel, you realistically need to be plugged into a very selective network of people that can show you what’s available for sale,” says Stephane. “Then, you need to raise the capital– typically a portion of debt and a portion in equity. Then you need to do your due diligence, bid for the asset, negotiate the contract, execute the contract, and if you’re successful, you will own property. Making an income on that property means you must also be good at effectively managing the asset to turn a profit, which is the excess of cash flow over the debt servicing and other expenses. When you flip the property, you make a capital gain.” 

This is the old way of higher-end commercial real estate, and according to Stephane, a small, incestuous world with a limited number of players. 

A screenshot of The AspenCoin August 2020 disclosure statement on tZERO

“There isn’t much value added beyond solving those cashflow inefficiencies,” says Stephane. “Tokenization changes the game completely. As a retail investor, you can go to a marketplace and choose a token corresponding to a property. For example, you can go on tZERO and look at AspenCoin, the digital token for the St. Regis. There is a disclosure statement, and you can see the performance of the asset.”

tZero, is a project launched by Overstock that functions as a platform for asset holders to tokenize their assets.  This system allows average investors to piggyback on the work of someone like Stephane, a process usually done privately. 

So, what incentivizes someone like Stephane has to allow the public to reap the fruits of his labor? 

Stephane describes the experience of owning a luxury property as wonderful in terms of bragging rights, but short-lived. 

Owners like Stephane can relish the beauty of their property, but this romanticism is soon dampened with the understanding that they aren’t able to access their equity without the tremendous amount of complications that come from selling the property. 

“Owning a property basically means you have a balance sheet that tells how much you owe the bank and the value of your equity,” says Stephane, reducing the glamour of luxury property ownership to accountant-speak. “There is no price discovery, nor is there a way for you to monetize that equity position other than selling the hotel. When you tokenize your asset as the asset holder, you have price discovery and know the full value of your equity. Better yet, you have liquidity. Let’s say you get married and are starting a family. You can sell off a few tokens of your asset. If you think the token price is too cheap, you can buy them back.” 

Having your money locked in an asset rarely caters to the ebbs and flows of life; as the owner of a tokenized asset, Stephane suggests, you have the flexibility to increase or decrease your position and know the current going rate of your equity. To that end, giving asset owners the luxury of liquidity also makes that asset that much more attractive to hold. 

What is AspenDigital?

AspenDigital is the token associated with Stephane De Baet’s tokenization of the St. Regis in Aspen, Colorado– a prestigious getaway for society’s pinky-up upper echelon tucked into the Rocky Mountains.

How has the tokenization of assets been applied so far?

“We created a digital security as part of an ownership privilege program,” says Stephane. “For us, it’s wonderful because we’re able to reward token holders like a true owner. We save on marketing costs, travel agent costs, and so on. The cost to us, the property owner, is minimal and the benefit to the consumer is maximum.” 

According to Stephane’s description of the tokenomics of AspenDigital, 

  • If you own 10,000 tokens for 30 days or more, you’re entitled to a 20% cash rebate on your spend during your stay. 
  • If you own 100k tokens: 35% cash rebate.
  • If you own half a million tokens:50% cash rebate. 

Stephane implores us to think about a patron spending Christmas or New Year at the St. Regis: The average room costs about $2,000 per day around this time, and if you come to stay for seven days with a family that requires two rooms, you’ll be looking at a $28,000 bill. If the current price of one of these tokens on tZERO is $1.31, 10,000 tokens will run you about $13,100. 

AspenDigital on tZero

AspenDigital on tZERO

This lump sum of tokens entitled you to 20% cashback on your stay, or about $5,600 back, which is a bit over 42% return on the value of your tokens for that one stay. 

I’m dreaming of a world where I don’t have any bank loans, and I’m just sending rebates to people buying pre-paid stays at my hotel. I will prove that this is a cheaper way for an owner to finance a property than a traditional mortgage.

In other words, Stephane wants to cut bank loans out of the hospitality industry, and build the infrastructure for business owners to raise capital from their top customers. 

“We want to find a way to repay a hundred percent of our debt and yield the benefits of savings on your cash flow to the consumer,” says Stephane. “All that the bank is doing is bridging a mismatch in cash flows as entrepreneurs build businesses to provide services to customers. Your consumer is actually the party giving you cash to pay your employees, pay your bank loans, and make a profit. The ultimate line of disintermediation is to get funding right from the consumer.”

Direct fundraising from consumers is not a new concert. For example, Elon Musk did it recently with Tesla, selling the Roadster at a high price point to raise capital. Selling your future product tends to be the cheapest source of capital. 

How can an asset holder leverage the perks of tokenization?

The problem with the current system is that value that would otherwise be devoted to improving the business-consumer relationship leaks into the coffers of third-party intermediary banks.

“If you raised capital from banks and private investors, you must factor loan obligations and interest into the equation,” says Stephane. “The bank will say, Stephane, I need my 6% interest payment. And then you have private investors and partners asking for their 15% return on their money. So, as an asset manager, I’m primarily incentivized to pay my debts first, and this often isn’t aligned with providing the absolute best experience for the consumer.”

You need to make sure you can pay your owners and investors, or otherwise, you’re in a hot seat. 

The service provider and consumers are tainted by that evil intermediary called banking. If we can remove the bank out of the equation and have consumers fund us directly, we can focus our efforts on building a better relationship between us as a service provider and our consumers.

How can security tokens or utility tokens change the world of real estate? When businesses are funded by customers directly, Stephane asserts, an entire asset class can be changed: 

  1. The valuation of the asset becomes somewhat irrelevant. Someone buys an asset because they want to use it in the future at a better price. They want a good deal. They don’t want to own the asset, they want to access a service in the future at a more attractive price. 
  2. Tokenization simplifies the relationship between a service provider and a consumer. For example, as a hotel provider or hotel operator, your job is to provide the best service to your consumer. You want them to be very happy with the experience he receives at your establishment. If you’re raising money from your customers, who now become partial owners of your property, you’re better incentivized to invest further into the customer experience. Similarly, your customers are incentivized to support your business.

“In order to offer perks, you need to own the asset,” says Stephane. “If someone is promising perks on someone else’s asset, I get uneasy. In order to be successful in the model we’re developing, you need to be ready to own the asset you’re offering perks on.” 

This is why, Stephane concedes, traditional banking relationships will always have a place in business. In order to hold assets without your own capital, you need someone to lend you money. However, lending must evolve with the world, not antagonize it.“I see the lending market changing significantly in the next decade,” says Stephane. “Think about it; if you buy Aspen Digital, you have the leverage which is basically the mortgage of the asset. Let’s assume I pay the mortgage tomorrow and issue more tokens. You should be able to show a lender you own tokens that represent unlevered ownership over a hotel and ask for an increase of leverage on your wallet. I think you’ll eventually start seeing asset-based leverage moving to consumer base leverage.”

A screenshot of AspenDigital’s trading history on tZERO.

Stephane sees a future where digital asset holders, whether that be Bitcoin or a coin representing a luxury mountain hotel, can seamlessly take out loans from mainstream banks. 

*Note: There are a few cryptocurrency loan providers such as BlockFi and Celsius that provide crypto-collateralized loans on cryptocurrency deposits.*

There is also a significant utility of these tokens, Stephane posits, that shouldn’t be overlooked. 

“Utility means people have a use for it, which creates natural liquidity into the asset class,” says Stephane. “The perks you receive from your tokens can grant token holders a value much greater than potential capital gains.”

Waxing philosophical, Stephane describes cash as merely a medium to acquire goods and services in the future. 

“Cash is an instrument to create an exchange,” says Stephane. “If you don’t need that instrument because you have access to the services simply by holding the asset and not spending it, you’ll change the relationship between people and money.”

In other words, instead of value slipping out of the business-customer relationship into the hands of third-party intermediaries, customers can achieve entirely new benefits usually only granted to the high-rolling owners. 

Regulation and Innovation: A Historically Toxic Relationship

Stephane’s journey into blockchain seeking an alternative to a very aging capital market and banking system, a search spanning decades. 

“The fact that we’re still relying on the Securities Act of 1933, dealing with paper securities, and using a clearing agent is amusing in that it’s nearly 100 years old. The whole finance industry and derivative of finance were really ready for a revolution, and I believe the ability to tokenize assets on the blockchain is a rallying cry.”   

Stephane encourages a future where regulation grows alongside innovation, rather than impeding it.

Stephane De Baets PHOTO CREDIT: BENJAMIN LOZOVSKY

“As entrepreneurs, we need to be respectful of the authorities and regulators, because while innovation can open new doors, it can also enable scam, fraud, and abuse,” says Stephane. “Collaborative regulation ensures we don’t shut down an entire enterprise just to protect the masses from a very small few negative actors.”

To truly stimulate the evolution of a landscape, you need a healthy regulatory environment, infrastructure to onboard new users, and market leaders. 

“If you consider 2017 as the first mainstream wave, we’re looking at the second one now,” says Stephane. “We’ve had the perfect element of a relatively stable economy to allow innovation to stabilize before this second wave, and now this more unstable economic environment pushes the need to deliver financial aid straight to the hands of the people. It brings us to consider what are the actual strengths of the legacy banking environment, and how well-suited is it to the people’s best interests?”

Coming from capital markets, Stephane argues, this revolution isn’t a matter of if; it’s a matter of when, who, and how. 

“I can say within five years, everything’s going to be digital, including the Dollar and Euro,” says Stephane. “We will have a digital wallet in our hands and we will be able to manage our assets without having to go to the bank or an ATM machine and withdraw money or deposit money.”

Final Thoughts

Access to capital isn’t equally distributed across the world, and as Stephane notes, it’s a very small network of people that tend to have the highest access. The businesses that bring in the highest returns aren’t usually available as investment options for the everyday Joe. 

The primary lever of any business relationship sits in the hands of the party who holds the capital. This capital has historically rarely left the grips of banks and society’s ultrawealthy, and the barrage of tax breaks and bailouts in the United States, in particular, have made sure that big money stays put.

However, by getting rid of the capital intermediaries by democratizing access to investments by tokenization, the luxuries of society’s ultrawealthy will finally trickle down to the masses.  At least, that’s the argument Stephane De Baets is making with the tokenization of the St. Regis hotel. 

These intermediaries, a category the Elevated Returns Stephane De Baets admittedly falls into, don’t act in the best interest of the Hotel Owner Stephane or the Customer Stephane. However, the multi-faceted Stephane seems to align his professional identities under one banner: the democratization of access and the disintermediation of the engorged third-party of banks, and he wants to use AspenDigital to revolutionize the real estate industry. 

The post Stephane De Baets Owns the St. Regis Aspen Resort, and You Can Too: Enter Tokenization appeared first on CoinCentral.

Source: Coin Central

Federal Reserve Now Targets Inflation Above 2%, Bitcoin Breaks $11K

Federal Reserve officials said Wednesday they would hold U.S. interest rates at close to zero and work to push inflation above 2% “for some time.”

  • Federal Open Market Committee keeps interest rates unchanged close to zero, according to its statement.
  • Panel agrees to maintain accommodative monetary policy until inflation climbs above 2% “for some time.”
  • The central bank will increase holdings of U.S. Treasury securities and mortgage-backed securities “at least at the current pace to sustain smooth market functioning and help foster accommodative financial conditions.”
  • Projection materials released with the statement show officials, on average, expect rates to remain close to zero through 2023.
  • On average, officials don’t expect 2% inflation until 2023.
  • Robert Kaplan, president of the Federal Reserve Bank of Dallas and a voting member of the panel, voted against the plan. He “prefers that the Committee retain greater policy rate flexibility.”
  • Neal Kashkari, president of the Federal Reserve Bank of Minneapolis, also cast a dissenting vote. He prefers that interest rates stay on hold “until core inflation has reached 2% on a sustained basis,” according to the statement.
  • Economists weren’t expecting Fed officials to make any changes to U.S. interest rates – which in March were cut close to zero on an emergency basis – as the…

Continue reading at COINDESK.com

 

 

NFT Platform Cargo Founder on Building on Ethereum

Cargo is an all-in-one platform to create, manage, and sell digital collectibles. Because of the interoperability that Ethereum provides, users can manage all of their compatible digital collectibles on Cargo– not just the ones created on Cargo. 

Launched in July 2020, Cargo represented several years of Founder Sean Papanikolas’ research and experimentation within the Ethereum ecosystem. Sean helped pioneer scalable minting technology on the Ethereum blockchain. 

With the launch of the Cargo Marketplace shortly after, Cargo has grown to voter 265 accounts created and over 170 unique digital items added to the marketplace. So far, the highest an item sold for has been for around $1200. 

We connected with Sean to discuss his entrepreneurial journey within the cryptocurrency landscape and the future of Non-Fungible Tokens

Could you give us a two-minute movie trailer of your life? How did you end up involved in the NFT space?

In 2017 a friend introduced me to Ethereum and It immediately piqued my interest. I’m drawn toward new technologies, but I’ve found the best way to understand them is to build something on them. So, I decided to build a dApp. At the time, I was dating a woman who was a fan of The Bachelor, so I created a smart contract betting on who would win The Bachelor. 

Well, nobody used the contract and the relationship didn’t work out, but I saw the power of Ethereum and learned how to write smart contracts in the process.

I asked my friend if he had an idea about something else we could build on Ethereum and he came back with an idea – a marketplace of 3D models. We planned on calling it Pedddle with three d’s – you know for “3D” models. We had the Pedddle t-shirts made and we were off to the races. 

Through this, I got familiar with the ERC-721 standard and even came up with an ERC-20 token called xR coin that would be used to purchase the 3D models. By the middle of 2017, I had a working prototype where users could upload 3D models and the platform would create NFTs and you could sell them.  

Unfortunately, my partner dropped out, so I scrapped Pedddle and started working on a digital collectible iOS and Android app to bring crypto to the masses. The plan was to abstract all of the crypto stuff and users could pay with a credit card.

The app was called Dolli and it allowed users to buy and collect grungy characters – most notably of which was the infamous Pizza Rob, which was a pretty big hit that I designed. The app was completed and ready to ship, but right before the launch, the payment processor rejected supporting the Dolli app. (At the time, payment processors wouldn’t touch a crypto app with a ten-foot pole.)

I tried a couple of other payment providers but soon came to realize that I was facing a centralization of power – the exact thing bitcoin was supposed to fix. I decided to rebuild Dolli using a decentralized infrastructure. 

That was the catalyst for Cargo. I knew there had to be others like me who would benefit from a platform that allowed you to create digital collectibles, interact with and sell them within your application.

For someone looking to get involved, either as an investor or as an entrepreneur, how would you define opportunity in the cryptocurrency space?

I’m not an investor, so take this with a grain of salt, but you want to look at the technology and the team. Who’s the team building the product, what are they building, and can they pull it off? 

The same applies to launching a startup. Even if the technology may be difficult to understand, you want to look at the team. In my case, I was fortunate to have teamed up with Polyient Labs, an early-stage blockchain incubator founded by Brad Robertson. He and his team understand the crypto and blockchain space, which is why they saw Cargo’s potential.

How will NFTs change day-to-day life?

I think for many people, it’s only a matter of time until NFTs are part of their daily life.

NFTs help make sense for digital ownership. Think about all the digital things you can own – art, tickets, subscriptions, access tokens, the list goes on. 

So, it may be that everyone eventually owns a piece of digital art and has it hanging in an electronic frame on their wall, or they are buying NFT tickets that they can trade or transfer. 

Or imagine that in every video game you played you actually owned the in-game items and could take them out of the game and sell them on secondary markets, or even use them in other games. This is exactly the ecosystem that Polyient Games and I are building.  

What does Cargo accomplishing its 5-year vision look like?

Hard to tell where the space as a whole will be in five years. We are really at an inflection point now, but I imagine that we will have made great strides in usability and scalability. But no matter, Cargo intends to be the platform of choice to power any NFT project regardless of whether it is small or large. 

For now, Cargo will continue building on Ethereum, but Ethereum in its current state could look significantly different in five years. We may be building on the next iteration of Ethereum, or a layer-2 solution. No matter what we are building on, we intend to take our principles of usability and scalability with us.

Can you explain how Cargo differs from other NFT platforms?

Cargo has spearheaded and is the first platform to integrate EIP-2309 which is a standard event to track the infinite creation of NFTs. Using efficient data structures, Cargo pioneered a smart contract allowing creators of the batch-create as many collectibles as they want in one transaction. 

Because of high gas fees, this can save creators thousands (or even tens of thousands) of dollars in transaction fees when creating collectibles at scale.

We’ve also just announced Cargo Gems, which will function as a utility token and payment option on the Cargo platform, as well as a governance token for the upcoming Cargo DAO. What’s exciting is that Gems can be staked inside of any compatible NFT for token rewards.

Cargo is the only platform that allows users to deploy smart contracts which enable them to create an infinite amount of NFTs in one transaction for the same cost as creating one NFT on other platforms. ERC-2309, an open standard on Ethereum that makes this possible, was spearheaded by myself because I realized early on that to scale NFTs we’d need a way to create and transfer large amounts at one time for a price that worked. Recently OpenSea, the largest marketplace for digital goods, started supporting the standard that makes this possible. 

From a feature perspective, we are the first open platform to support 3D NFTs and we also support audio, video files in addition to image NFTs. On Cargo, you can lock digital content within your NFTs that only the token holder can unlock and that content is AES-256 encrypted. 

When I was building Cargo I never thought that it would be only an NFT marketplace and it’s not. Cargo was built to be the engine that powers other NFT projects in a way that scales and is cost-efficient. We have a robust API that allows you to use Cargo’s infrastructure directly in your platform.

From the beginning, we could collaborate with others and automatically split payments – this has been supported via our API.  We are seeing that people want this in the UI of the site, so we are working on including it in a future version of Cargo. 

This is a cool feature and opens the door for a lot of cool projects. 

For example, you could do an art series for charity and you can set it up so each of the charities will automatically receive payment when one of the pieces is sold. Or, if you’re an artist, you can collaborate with other artists, or create your own marketplace that other artists can join.

Where can our readers learn more?

Our next big release will be Cargo Gems which brings the exciting world of Defi to the NFT space. You can find more information here.  

Readers can visit Cargo here. They can also follow Cargo on Twitter

 

The post NFT Platform Cargo Founder on Building on Ethereum appeared first on CoinCentral.

Source: Coin Central

eToro Review 2020: Is eToro Legit, Safe, and Worth Your Time?

eToro is often referred to as the “Robinhood of Europe,” drawing comparisons to the U.S. Fin-tech unicorn for its user-friend trading experience. For U.S-based eToro users, the platform offers 15 cryptocurrencies for trade, such as Bitcoin and Ethereum. For international eToro users, the offerings expand to stocks and forex.

A few unique features give eToro separate eToro from the cryptocurrency exchange pack: social trading, CopyPortfolio, and CopyTrader– the latter feature allows you to simply “copy” the live portfolio of top cryptocurrency traders on the platform for free. Whereas traditional fund managers are formally accredited and can invest your money for a fee, eToro’s copyable traders are ordinary people that simply have had success or experience trading cryptocurrency.

While the hands-off cryptocurrency investing approach can be fairly attractive, we urge our reader to be very cautious when investing anything. Cryptocurrency is a very risky asset class, and just because your trades are on autopilot doesn’t mean you can’t get rocked all the same (set your stop losses!)

The following eToro review will teach you everything you need to know about the trading platform:

  • eToro’s company history
  • How to make an account on eToro
  • eToro wallets and accounts
  • What are eToro fees
  • How does trading work on eToro
  • What is the eToro Copytrader feature?
  • How to make money on eToro

Key points:

✅ eToro is a user-friendly social trading platform that offers United States traders the ability to trade a variety of cryptocurrency, and European traders to trade a wider variety of financial instruments like stocks, crypto, commodities, currencies, and more.

✅eToro is a very beginner-friendly exchange that allows for a direct fiat to cryptocurrency exchange– new users can get started trading cryptocurrency on eToro for as little as $50.

✅ Features like CopyTrader and CopyPortfolio are a pretty hands-off, albeit risky, approach to cryptocurrency trading.

✅ eToro is heavy on “social” trading and encourages users to discuss short-term and long-term cryptocurrency trades.

❌Trading fees are relatively higher than the industry standard for most other exchanges. We call this the “UI Tax”

❌Users can’t actually access their assets, they can only trade them for fiat. Although eToro is a great trading platform, we’re not too big a fan of the lack of custodial ownership over your cryptocurrency.

eToro’s Company Information

A quick walk down the history lane of the rising fin-tech star leads us through a user-first approach to design and a pivot to embrace the growing cryptocurrency market.

When was eToro founded? Founded in 2007 by entrepreneurs David Ring, Ronen Assia, and Yoni Assia in Israel, eToro has since grown to over 500 employees, operations in 140 countries, and over 13 million users internationally.

How much has eToro raised? eToro is fairly well-capitalized and has raised a total of $222.7M in funding in over 10 rounds, with the latest Series E round coming in April 2018.

Which companies has eToro acquired: eToro has acquired two organizations–Belgium-based cryptocurrency portfolio tracker app Delta in September 2019, and Danish smart contract infrastructure provider Firmo in March 2019.

The holding company eToro (UK) Ltd. is based in London, and eToro has additional registered offices in Cyprus, Tel Aviv, New Jersey, Sydney, and Shanghai.

eToro started with a primary focus on trading fiat currencies and commodities, introducing stocks in July 2013 and a broader array of cryptocurrencies in 2017. eToro offered Bitcoin trading in 2013 with CFDs and was one of the few FinTech platforms of the time providing access to the then-nascent Bitcoin.

In February 2017, eToro expanded its cryptocurrency offerings to Ethereum, XRP, Litecoin, and a handful of other cryptocurrencies. With the ensuing mid-2017 cryptocurrency market boom, eToro doubled down on its international customer acquisition to cement itself as a premier exchange in the cryptocurrency community.

eToro launched its eToro U.S. operations in March 2019, starting with a handful of cryptocurrencies available for trading and eventually growing to over 15.

The platform is unique in the cryptocurrency industry because of features like CopyTrader and social trading, allowing traders to share live trading information, copy the portfolios of the best-performing traders, and approach cryptocurrency investing from a relatively “hands-off” approach* we’ll get into it below..

*Let’s reiterate this important caveat:: don’t invest anything you cannot afford to lose, no platform can offer truly 100% guaranteed gains, all investing (particularly cryptocurrency investing) tend to come with a high degree of risk.*

Key Feature #1: What is the eToro Copytrader feature?

In 2010, eToro leaned into the title of being the world’s first social trading platform with the launch of OpenBook, a feature that allowed anyone in the world to copy successful traders using CopyTrader. OpenBook was regarded as a fairly revolutionary concept in FinTech at the time, winning the Finovate Europe Best of Show for 2011.

You may have been hit with a targeted eToro ad with Alec Baldwin before– here it is again for good measure; it’s actually a decent explainer of what the CopyTrader feature does.

CopyTrader, in our humble opinion, stands as one of the best features in FinTech.

Why? Being able to see how and what top traders are trading is something that some companies try to charge thousands of dollars for, or a percentage of assets under management. eToro takes it a step further by making it possible to “copy” their portfolios with one click. If this idea tickles your fancy, make an eToro account and take a look at the traders– you’ll have to access a particular version of the site depending on your location for regulatory reasons: eToro U.S. and eToro International.

The minimum amount to copy a trader is $200, and the max is $500,000. You can copy up to a limit of 100 traders at the same time.

Here’s our run-through of CopyTrader

Below, there are two sections: “Top Performing” and “Most Copied”

On the Most Copied section, we see the platform’s most popular traders, seemingly sorted in some sort of weighted popularity average rather than percentage gain.

Let’s check out what makes this QE4Everyone (Mati Greenspan) trader so popular.

After clicking on Greenspan’s profile, we see his social posts directed towards the eToro trading community, our current investment (we deposited $300 to test this feature) in his copy portfolio and it’s overall performance– thanks for the $17 bucks, Mr. Greenspan. We also see Greenspan’s bio– a published author, Founder & CEO of a company called Quantum Economics, and a former Senior Market Analyst at eToro.

Clicking on his profile stats, we see his cryptocurrency trading performance per month. While the cryptocurrency market itself experienced some volatility these months, Greenspan seems to have handled it pretty well.

Further, we see how “risky” this trader is with a risk score assigned by eToro, as well as the number of recent trade copiers (of between $100k to $300k in copy value.)

We can get a bit more detail into Greenspan’s trades: we see the total amount of trades in the past year, and his most frequently traded assets.

On the portfolio tab, we see exactly what his trades are at the current moment. From here, we can either buy those same assets manually, or once we add some funds, we can copy Greenspan’s portfolio, and eToro will automatically mirror his trades until you tell it to stop, or until the copy stop loss hits.

While the Top Performing profiles look very appealing, we urge our readers to do the appropriate amount of research on eToro’s platform to understand how they’ve been able to achieve such results.

For example, many of these traders have simply bought one asset months ago that mooned and haven’t launched a trade since. So, by copying their portfolio, you’d basically just be “buying” the asset at its current price.

How to Use eToro’s CopyTrader:

CopyTrader is really simple. Once you’ve made your eToro account (eToro U.S. and eToro International) go to the CopyTrader section, select a trader to copy, and add the funds required.

For example, let’s say we want to copy crypto101_kevin (Kevin Stanley). He seems like a nice guy, but more importantly, he has a decent amount of other copiers and a 27% gain for this year so far.

An important risk-management feature here is the ability to immediately stop copying a trader’s profile if the value drops below a certain amount. Let’s assume we’ve decided we can stomach a 60% worst-case-scenario loss on an investment of $200– we would set the amount accordingly and deposit the funds.

We deposit the USD, and boom– we’re copying a trader.

Key Feature #2: CopyPortfolios

In 2016, eToro furthered its social trading offerings with the release of CopyPortfolios, a long-term thematic investment product of managed portfolios with bundled Top Traders or specific assets using a predetermined market strategy. The majority of eToro’s CopyPortfolios utilize machine learning to seek maximum returns.

There are three CopyPortfolios available in the United States. TheTIE, for example, builds its investment strategy on sentiment analysis, gauging the positive and negative tone of tweets on Twitter.

Key Feature #3: Virtual Portfolio

The eToro virtual portfolio is basically a sandbox, where users receive $100k in fake money to test-drive the platform.

This feature doesn’t seem to be available in the USA just yet.

eToro USA and eToro International

An important distinction to make for our wonderful readers spread all over the world: eToro has two different platforms due to regulatory compliance: one for eToro U.S. and one for eToro International users.

Is eToro available in the US? Yes, but only the cryptocurrency trading aspects. If you’re in the United States, you’ll have access to the same cryptocurrency investment trading platform as everyone else, as well as the CopyTrader and CopyPortfolio features, but you can’t trade stocks or forex (yet).

How to Use eToro in USA – Use the following link to make an eToro USA account.

eToro International: There’s a reason why eToro is often called the “Robinhood of Europe”– but that’s leaving some value on the table: the platform allows international users to trade forex, stocks, and cryptocurrency. If you are outside of the USA, use the following link for eToro international.

How to Sign Up

Ease of Use: A+

Signing up for eToro is a very streamlined experience with the basic “Know Your Customer” (KYC) requirements most exchanges in the US require.

  1. If you’re in the USA, use the following link to make an eToro USA account. If you are outside of the USA, use the following link for eToro international. You’ll land on a page with Alec Baldwin pointing to his phone
  2. Hit JOIN NOW and create your account information.

  1. Before submitting, we recommend taking some time to familiarize yourself with eToro’s Privacy Policy and Terms & Conditions. Once you’ve finished, check the boxes and CREATE ACCOUNT to submit your information.
  2. Now comes the fun part– KYC! As part of this process, newly registered investors are required to provide Proof of Identity such as a valid passport or driver’s license, and in some cases, Confirmation of Residence (such as a valid utility bill.)
  3. Further, new eToro users will be requested to fill out a brief questionnaire to help eToro better understand which features are best suited to their investor profile. Questions include things like: investor’s professional status, level of knowledge of the capital markets, financial liquidity, acceptable levels of risk, and investment goals.
  4. You’re set!

What are eToro’s Fees

eToro’s pricing policies are fairly transparent. They’re higher than the industry standard of cryptocurrency exchanges like Bittrex or Binance, but eToro is technically a different type of platform than just a standalone exchange.

eToro Spread Fees: Spread fees are basically how “no commission” brokers and exchanges like Robinhood and eToro make money– it’s a cost built into the buy and sell price of the cryptocurrency pair you want to trade. The difference of what the asset is on the market (ie. ETH = $200.23) and what it costs to buy it on a certain platform (ie. Buy ETH = $200.45)– the fee would be the additional $0.22 cents.

These fees are fairly reasonable for most cryptocurrency assets, currently ranging between .75% for BTC to upwards of 5% for Tezos, the latter of which is really high.

eToro Withdrawal Fees: There are no ($0) withdrawal fees on eToro in the US ($5 withdrawal fee for all other regions), but there is a minimum of withdrawing $30.

eToro Wallet fees: eToro doesn’t charge fees for sending or receiving transactions, although blockchain fees are still applicable. eToro does charge a .1% conversion fee set to eToro market rates.

To learn more about eToro’s fees, visit their fee page.

eToro Fund Security

eToro’s wallets are secured by multisignature and analytic behavior machine learning, which aims to help the platform’s security team identify and prevent potential threats from malicious third parties.

According to eToro, depositing fiar money into your account is safe, private, secure, and for US users, FDIC insured. Cryptocurrency, however, is not covered by FDIC insurance. Transactions are communicated through Secure Socket Layer (SSL), which helps keep personal information safe.

How to Trade on eToro

We’ll preface this section by saying that nothing in the investment world is guaranteed, and placing any cryptocurrency outside of your savings account carries some risk.

That being said, eToro makes cryptocurrency trading and cryptocurrency risk management a relatively passive, but not risk-free, endeavor if you’re using its CopyTrader feature. Pairing the CopyTrader feature with a Copy Value portfolio drop threshold should provide you both a cryptocurrency investment strategy on autopilot (ideally run by an experienced trader) with training wheels in case of a calamity.

Final Thoughts – Is eToro a Good Platform to Use?

Ultimately, eToro is a user-first company with enough venture capital money raised to ensure the platform meets the growing needs of its users. Everything from the open-market cryptocurrency exchange to the CopyTrader features is super intuitive.

We can see this platform being very successful in providing beginner and intermediate users a great user experience.

However, it’s worth pointing out that eToro seems to be primarily designed for trading, and users actually can’t access their cryptocurrency directly. For example, if you bought 1 BTC, you wouldn’t be able to send it to your hardware wallet (you may be able to send it to eToro’s wallet, but that’s another product for another day.) You would have to sell your BTC for USD, and then transfer your USD back to your bank, and then transfer it to an exchange that does allow you to withdraw the digital asset.

That being said, eToro’s CopyTrader and CopyPortfolio make it a pretty awesome product in the arsenal of any cryptocurrency user. The features are free and don’t charge you any fees on your gains, you just have to pay the spread fee as you would on any other exchange.

eToro is geared towards “social trading” where users can learn from each other; as more users join the eToro platform, we predict more experienced traders will be open to having their portfolios copied to build their reputations in the space. If you are an experienced trader looking to join eToro, they have a fairly appealing compensation program for Popular Traders.

If you do decide to use eToro, use one of the following links based on your location: eToro U.S. and eToro International.

The post eToro Review 2020: Is eToro Legit, Safe, and Worth Your Time? appeared first on CoinCentral.

Source: Coin Central

What is Yield Farming? Exploring DeFi’s Recent Rising Star

Reading Time: 7 minutes

Yield farming is a method to harness idle cryptocurrencies such as coins, tokens, stablecoins, and put those assets to work in a decentralized finance fund, often generating interest rates that range between conservative 0.25% for less popular tokens and above 142% for some MKR loans.

Crypto lending rates on Defi Rate

A full list of interest rates and projects can be found at Staked.us and DefiRate.

Passive income from DeFi lending and staking isn’t guaranteed and actual returns will depend on each protocol’s approach. The risks run the gamut of missing out on the promised returns due to slow transactions or market volatility, or even losing your entire collateral.

To understand yield farming, we can draw comparisons from traditional finance: money is issued by a central bank, and then commercial banks lend those funds to businesses and individuals. Banks levy an interest rate on those loans, thus making a profit. 

In the cryptocurrency DeFi economy, a yield farmer plays the role of a bank, lending their funds to boost the use of coins and tokens. Thus, any cryptocurrency owner can hold their own funds while also participating in lending activity, essentially becoming a one-person commercial bank. This increases the flow of value within the decentralized ecosystem system, which in turn, generates returns for the lender.

“Farming” refers to reaping high annualized percentage gains while providing liquidity for various projects. In a way, yield farming resembles the more traditional practice of staking coins, where the user remains in control of their asset, but locks it temporarily in exchange for returns.

Yield farming has quickly become a point of interest for cryptocurrency enthusiasts and investors, often advertised for providing theoretical “fast gains” in the wake of high risk. 

Is yield farming worth it? Let’s dive into the mechanics of yield farming so you can become more educated on what yield farming and how it functions. 

In this article, we’ll explore:

  1. Yield farming’s relationship with DeFi
  2. How yield farming works
  3. Are your funds safe?
  4. The risks of decentralized lending
  5. The best DeFi projects for yield farming 
  6. The future of yield farming

Is Yield Farming DeFi?

Yield farming is a relatively new concept within the Decentralized Finance (DeFi) ecosystem, and the term entered the popular lexicon of the cryptocurrency world in 2020.

DeFi, an ambitious copy of the traditional finance system, is completely on decentralized Internet protocols. Instead of legal hassles and third-party intermediaries, DeFi offers a no-barrier entry to risk exposure. 

DeFi sprung from one of the use cases for the Ethereum protocol. The possibility for cheap and borderless transactions pushed the creation of startups that tried to mimic banks and financial brokers. DeFi applications branched out in various directions including novel cryptocurrency trading algorithms, derivatives trading, margin trading, money transfers, and most importantly, lending markets. 

DeFi Pulse – the growth of DeFi in 2020

Cryptocurrency lending entered a phase of functional maturity largely due to two behemoth projects – Maker DAO, and Compound. 

Other important DeFi platforms combine cryptocurrency lending and cryptocurrency interest accounts into single user-friendly platforms, such as the Celsius Network and BlockFi. These two companies are leaders in an industry where offering more than 6% on BTC and 8.6% on stablecoins such as USDC and USDT is considered industry standard. 

Another important aspect of DeFi and yield farming are trading projects and decentralized exchanges. These projects also offer yield farming, but the liquidity is used for trading. Prominent projects include Bancor, Augur, and UniSwap.

So, where does yield farming come into play?

How Yield Farming Works

Yield farming depends on the inflows and outflows of a certain anchor asset, usually DAI, a dollar-pegged coin that originated with the Maker DAO protocol. As of August 2020, DAI is backed by ETH and BAT deposits, and is used for loans, arbitrage or algorithmic trades. The DAI dollar peg makes the system more predictable by setting an intuitive value for each token, $1. Yield farming depends on a collateral of ETH or another token, which are used for loans and generate passive income. 

A DeFi user will usually lock in the chosen coins by using the MetaMask browser plugin. Locking in funds means the wallet will communicate with a smart contract on the Ethereum network. Depending on the logic of the smart contracts, there are various ways to extract value, though the most traditional one is to levy an interest rate on a cryptocurrency loan. Users will pay fees to transact on the Ethereum network, and due to heightened interest, those fees may rise rapidly, or make the network too congested to be able to participate successfully.

In the middle of March 2020, ETH prices dropped sharply, creating a perfect storm of market panic and the triggering of multiple algorithms on the Maker DAO platform. The Ethereum network also slowed down transactions, not allowing the owners to increase their collateral. Multiple deposits (known as vaults) were liquidated, and DAI briefly lost its dollar peg.

In the case of falling prices, the 150% over-collateralization can help offset the risk partially. Projects like DeFi Saver can automatically increase the collateral to stave off liquidations. Liquidations happen when the minimum collateral requirement breaks down due to price volatility.

DeFi tends to work better in climate climbing asset prices, because the collateral locked for yield farming is safer. For example, if ETH prices drop by 33%, this would liquidate most deposits on Maker DAO. Smaller price fluctuations also mean holding ETH may, in the long run, be more profitable than yield farming.

Alexander Ivanov, the founder of the WAVES protocol, compares DeFi to the frenzy for initial coin offerings (ICOs). Ivanov is still optimistic about the future, only warning against another bubble due to irrational enthusiasm.

The difference between an ICO and yield farming is that coins can be taken out of the DeFi protocol at almost any time, whereas participating in an ICO meant exchanging ETH or BTC for a new token. 

The new token could be changed back only by trading, once it was listed on an exchange. In DeFi, tokens become immediately liquid as they get pairings on the UniSwap exchange, a decentralized, automated trading protocol.

Are Your Funds Safe While Yield Farming?

All types of cryptocurrency investing carry risks. 

In DeFi, the lender is always in control of their funds, as operations happen in automated smart contracts and do not require the oversight of third parties. Unlike token sales, a person can withdraw their collateral at almost any time. 

However, smart contracts can dictate how and when you can withdraw your collateral, so be aware of you’re getting into, in particular during the cases of liquidation. 

What are the Risks of Yield Farming?

Locking your funds in vaults and using smart contracts is inherently risky. Smart contract exploits, which abuse the logic of the contract to generate high returns, and liquidations are a major threat to collateralized funds. The other big risk is the peg of the DAI stablecoin, which must retain its $1 value. Breaking the $1 peg will diminish the value of loans, and create panic selling and quick removal of liquidity.

The boom of DeFi also brought multiple untested protocols, using new smart contracts that led to malfunctions. The YAM DeFi protocol drew in close to $300 million in funds, but due to unforeseen smart contract behavior, led to the printing of thousands of billions of extra tokens. Other projects also release untested smart contracts, which may lead to losses of funds.

Another major concern is a more recent development: the Compound DeFi fund shows more than 1.3 billion DAI in its lending and borrowing markets, while there are around 421 million DAI coins created as of August 14, 2020. This situation resembles a debt bubble, in which cryptocurrency assets are created via the process of lending, thus circulating value that is artificially amplified by yield farmers. 

This situation may put pressure on the DAI dollar peg, and create more serious fallout in case of liquidations. So far, as of August 2020, greed and a price boom allow for the rapid growth of Compound DeFi. 

What are the Best Projects for Yield Farming

Maker DAO is one of the earliest successful attempts at cryptocurrency lending. Initially, lending DAI backed by ETH drew the initial bulk of capital into DeFi. 

Compound, a similar lending platform, followed soon after. Compound also evolved beyond lending, launching its own incentive COMP token. This caused an explosion in DeFi funding between July 15 and early August, when the amount of funds locked in yield farming doubled, from roughly $2 billion to above $4 billion. 

Both Compound and Maker DAO competed for the top spot in DeFi, based on locked value and on their well-known brands. In terms of algorithmic trading, projects like Augur, Bancor, and dy/dx remain prominent in the crypto space.

Alternatively, and not particularly “yield farming” per se, decentralized lending platforms and cryptocurrency interest accounts such as BlockFi and Celsius provide upwards of 8.6% APY on stablecoins without many of the complications of the yield farming outlined in this article, so they’re worth checking out if that’s up your alley. 

Final Thoughts – What is the Future of Yield Farming

Things tend to happen very fast in the cryptocurrency world, and yield farming seems to have spiked into the mainstream foray in the blink of an eye.  

If one was compelled to cast a prediction for the future of Yield Farming, we recommend looking at all possibilities– both positive and negative. 

For example, yield farming can mobilize otherwise idle tokens, potentially generating passive income for their holders. 

On the other hand, negative possibilities range from crisis events such as price crashes or exploits that manage to trick the smart contract and reap gains from collaterals. DeFi isn’t regulated and doesn’t come with the legal protections that come with more centralized financial institutions. 

For instance, DeFi tokens are not considered securities, and the US Securities and Exchange Commission hasn’t taken any decisive actions against them. 

While some yield farming projects are well-established and draw in the bulk of collateral, new DeFi algorithms are constantly popping up. Some DeFistartups use copied and unaudited smart contracts, posing risks for unexpected operations and effects. The YAM yield farming project, for instance, has recently crashed, taking some of the market collateral with it. 

In August 2020, the WAVES platform expanded into DeFi. A long list of former ICO tokens that were repurposed for various forms of DeFi, starting with BAT, LINK, 0x, Kyber Network. A complete list of the most current and active DeFi tokens can be found at CoinGecko.

Yield farming is a mercenary-like approach to cryptocurrency, where risk-takers seek out the highest yields, causing token price volatility along the way. Many DeFi projects are still in their nascent phases and can be rather difficult to understand, yet many newcomers are rushing in to get a piece of the pie. We advise our readers to do their own research into the intricacies of each platform– don’t lock in any funds you can’t afford to lose.

The post What is Yield Farming? Exploring DeFi’s Recent Rising Star appeared first on CoinCentral.

Source: Coin Central

ShapeShift Releases Mobile App to Make Non-Custodial Crypto Easier

Reading Time: 2 minutes

ShapeShift, a leading self-custody cryptocurrency exchange platform, recently released its mobile app, which allows users to buy, trade, and exchange cryptocurrency such as Bitcoin without requiring third-party to take custody of their public and private keys. 

Why is this important? Most cryptocurrency exchanges are custodial, meaning they hold their users’ private keys, and therefore, their funds. For example, if the wallets of exchange such as Binance or Coinbase are hacked, in theory, the malicious hacker could access the users’ private keys and steal their funds. 

ShapeShift is one of the few platforms that is non-custodial, meaning it allows users to exchange digital assets without having to put their private keys outside of their own control. 

The new ShapeShift mobile app is designed to onboard new users into the cryptocurrency world without having to use a custodial solution. 

“The ShapeShift crypto platform launched a year ago, bringing proper self-custody digital asset management to the masses,” comments ShapeShift CEO and Founder Erik Voorhees. “But, it was only available on the web. The mobile app is here, and with one email and password, users can enjoy self-sovereign finance on both web and mobile. As traditional financial systems become increasingly tenuous, Bitcoin offers refuge and empowerment. We’re here to make it easy.”

ShapeShift has been a key player in the cryptocurrency ecosystem since July 2014 and has championed the “be your own bank” ethos that attracts many cryptocurrency users into the ecosystem. 

With the launch of its mobile app, ShapeShift continues to place itself at the forefront of beginner-oriented cryptocurrency usage. 

Users can now buy Bitcoin with a credit (or debit) card, trade a variety of other popular digital assets, and transact with other users anywhere in the world, all while retaining full custody of their keys. 

In April 2020, ShapeShift acquired Israeli crypto-startup Portis, a leading wallet solution for Ethereum-based “web3” applications. The team plans to use Portis to allow ShapeShift users to access leading DeFi services, all in one place. 

For a limited time, you can get $3 in BTC after you download the ShapeShift app and verify your account. You can download ShapeShift’s mobile app on iOS and Android.

ShapeShift’s app is available immediately on iOS and Android, and is the easiest way to get started with digital currency.

You can learn more about ShapeShift here

The post ShapeShift Releases Mobile App to Make Non-Custodial Crypto Easier appeared first on CoinCentral.

Source: Coin Central

The Best Ethereum Wallet Reviews for 2020

Reading Time: 10 minutes

Ethereum has one of the highest market caps in the cryptocurrency world so it’s no surprise that there’s been a major influx of attention from the mainstream public.

With this increased attention comes the need for a secure place to store ether.

So we’re going to talk about Ethereum wallets. Think about what you really need for storing your ether. A few questions to mull over:

  • Do you need a wallet that can hold several currencies, or just Ethereum? There are plenty of wallets that allow you to hold different cryptos, as well as some that are strictly for Ethereum.
  • Do you plan on frequently trading your Ethereum? Some wallets make it easier for frequent traders, and others prioritize security and can be a bit of a hassle to frequently trade with.
  • Do you want access to your wallet from anywhere at anytime, or only from one location? There is often an inverse-relationship between accessibility and security.

By the end of this guide, you’ll know the most popular Ethereum wallets and which one is perfect for you.

The Best Ethereum Wallets

Wallet Wallet Type Security Web Interface Mobile App Desktop Client Price Rating

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Hardware Great €58 5

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Hardware Great €89 5

Software Good Free 4.6

Software Good Free 4.5

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Online Good Free 4.5

exodus wallet review logo

Client Good Free 4.5

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Online Good Free 4.5

Online Good Free 4.5
Online Good Free 4.8

What to Look For in an Ethereum Wallet

Finding the perfect Ethereum wallet shouldn’t be difficult, but it does require a general understanding of how cryptocurrency storage works.

In broad strokes, there are generally four different wallet types:

  1. Hardware wallets: These wallets are physical wallets that have your private keys encrypted into them. These are the most secure type. Gringotts Wizarding Bank level. Hardware wallets allow you to keep your cryptocurrencies in “cold” storage—offline–so your coins are inaccessible to Internet hackers.
  2. Online wallets: These wallets exist online. Duh. While they are still considered extremely secure, the fact that they are connected to the Internet exposes you to a small amount of risk. You can use these wallets on a variety of devices.
  3. Desktop wallet: These wallets are downloaded and installed on your computer (PC or laptop). Once installed, only that specific computer can access the wallet.
  4. Paper wallets: These wallets are pieces of paper with your private keys on them. These are extremely risky because if you lose this piece of paper, the chance of accessing your coins in the future is extremely slim. Goodbye mulah. Additionally, most paper wallet generation sites are actually phishing sites preying on novice crypto traders. Paper wallets for Ethereum are particularly inadvisable since there is a substantial lack of good options.

When looking for a secure cryptocurrency wallet, keep an eye out for the following four features:

  1. Private keys: You want to have a private key that only you possess. This is essentially the keys to accessing your coins, and security here is non-negotiable.
  2. Development community: Since Ethereum wallets are relatively new, reputation is huge. Look for an active development community that has a promising future.
  3. Simple user interface: Look for something that is easy to use. You also want to ensure that your wallet is compatible with different operating systems.
  4. Security and backup: Minimize your exposure to human error. Don’t be the person who makes the news for losing a million dollars in crypto by displacing their hardware wallet and forgetting to backup your information.

Save yourself the trouble and find a wallet that has the above four criteria.

TREZOR

TREZOR is a hardware wallet, meaning it holds your private keys offline (which you already knew because you carefully read the previous text, right?!). Originally invented for Bitcoin, users can now store Ethereum on TREZOR using the MyEtherWallet web interface.

trezor wallet review

This flash drive-sized device stores ether offline with a secure electronic chip. Users can only activate this electronic chip by logging in with their password. TREZOR also uses a limited USB connection, meaning that it can even safely interact with computers that may have been compromised or infected.

Overall: TREZOR is an excellent choice because it is extremely secure, has an active development community, and allows users to store both Bitcoin and Ethereum. It costs around $99.

 

Ledger Nano S

The Ledger Nano S is one of the highest-rated hardware wallets because it excels in the four criteria we mentioned before. The interface is very user friendly. It comes with a small OLED screen that makes controlling your transactions simple. Users can set a 4-digit pin on the physical wallet itself, which is an extra element added to prevent keylogging.

ledger nano s hardware wallet

The Ledger Nano S stores ether offline and requires users to sign transactions with their private key in order to spend ether. Additionally, the Ledger Nano S has an option to create a recovery seed to recover your private keys if the device is lost or broken. This added feature minimizes your risk of losing all your coins if you misplace your device. The Ledge Nano S alleviates the stress of using a hardware wallet, and stores both Ethereum (ETH) and Ethereum Classic (ETC).

Overall: The Ledger Nano S is neck and neck with the Trezor, but comes at a much more modest price of $65. The sleek user interface and added elements of security make it an extremely competitive option for any cryptocurrency investor.

Exodus Wallet

Exodus is a desktop wallet and is the world’s first desktop wallet that can hold multiple cryptocurrencies. While most crypto wallets are limited to just Bitcoin and Ethereum, Exodus makes it possible to hold a much more diverse portfolio.

One of the most appealing aspects of Exodus is the seamless and clean user interface that presents a user’s portfolio as a pie chart. Exodus is always connected to the Internet but it doesn’t take your private keys from your device. Additionally, one-click email recovery and backup seed keys make restoring your wallet possible.

exodus wallet review portfolio

It also has ShapeShift built into it so exchanging cryptocurrencies is much easier. The benefit of  Exodus is that you can trade cryptocurrencies with ease, whereas you would have to undergo a lengthy process with hardware wallets.

Overall: While Exodus has a beautifully simple user interface, it’s important to remember that it is always connected to the Internet. This fact alone makes it slightly less secure than a hardware wallet. Though the risk is negligible, it’s still worth mentioning.

Coinbase

Coinbase, a web wallet, is the simplest and easiest to use compared to other options on this list. It is both an exchange and a wallet platform. You can buy Ethereum, Bitcoin, and Litecoin with fiat currency, and keep your cryptocurrencies secure.

coinbase wallet review

Since the private keys are stored on Coinbase’s hosted servers, you ultimately don’t have total control over your keys. Fortunately, Coinbase is an extremely credible San Francisco-based company with a valuation of over 1 billion and a reputation as being very safe and trustworthy.

Overall: The ease of use makes Coinbase a top option for many beginners. The only drawback is that users ultimately don’t have the same sort of control over their private keys as they would with a hardware wallet.

MyEtherWallet

MyEtherWallet is an open-source web wallet that is different from Coinbase and other traditional web wallets in that you have full control of your private key on your computer. This means you can generate new wallets and store your ether without having to do it on MyEtherWallet servers. This also means you are fully responsible for safely backing up your wallet.

MyEtherWallet is great because it allows you to write and access smart contracts. It also connects with Trezor and Ledger Nano S to safely access your Ethereum within the MyEther platform.

MyEtherWalletReview

 

Jaxx

Jaxx is a software wallet that supports many of the leading cryptocurrency coins including Ethereum. The wallet is readily available on:

  • Android (mobile and tablet)
  • iOS (mobile and tablet)
  • OS X
  • Windows
  • Linux
  • Chrome (extension)

There’s also a hardware wallet coming soon.

Designed with the end-user in mind, the wallet is simple to use and has an intuitive interface that even a beginner holder should have no problem figuring out.

With Jaxx, the power is entirely in your hands. All of the keys are created on your local device and are never sent to any servers. Because of this, there is no way for the company to access your funds. Jaxx also avoids collecting any personal information, and you don’t have to provide any verification to use the wallet. For crypto-enthusiasts who value privacy, this is a wonderful thing.

On top of that, the code for the Jaxx wallet is auditable to anyone. This brings a level of trust to the community because any person can audit their codebase and surface any issues or loopholes. Jaxx emphasizes that to prevent malicious copycats, their code is not open source. However, the level of transparency they provide should be enough to give the company your trust.  

Overall: With a clean interface and complete control over your wallet keys, Jaxx is a great option to store your cryptocurrency. The wallet has more security than a purely online option but has more vulnerabilities than a hardware wallet.

Mist

Mist is a hybrid desktop wallet with a web interface and is the official wallet listed on the Ethereum Project website. The product is still in beta, so there are issues that may arise when using it, though. To help with these problems, the development team provides a list of common issues and how to fix them on their Github wiki.

The wallet’s available on Mac, Linux, and Windows, so if you’re reading this, you can most likely use it.

Mist protects your wallet with a password that can never be changed once it’s set. I highly recommend that you choose a strong password and don’t forget it. Write it down, memorize it, put it in a safe, etch it on the bottom of a table in the middle of a park – whatever you need to do to make sure you’ll remember it. If you lose this password, you’ll have no way to access your wallet.

With mist, you have complete anonymity. You can download and use the wallet without having to provide any personal information or identification. You also have complete control over your private keys which are held on whichever device you use to download the wallet.

Overall: As the official wallet of Ethereum, you can’t go wrong choosing Mist. Although other wallets exist with a better interface or more security (hardware wallets), this endorsement adds a significant amount of trust to the platform.

MetaMask

MetaMask is a browser extension that allows you to run Ethereum dApps directly in your browser without having to run a full Ethereum node. More than just a wallet, you can also interact with dApps and smart contracts on MetaMask.

MetaMask is currently only available as a Chrome extension or through the Brave browser, but the team states that they plan to support Firefox and the rest of the popular browsers soon.

MetaMask interface

Your account information is encrypted and stored locally on your browser, so no information ever touches the MetaMask servers. You also full control over the management of your private keys.

If you have trouble getting started with MetaMask, they have a video on their homepage you can watch as well as a comprehensive customer support section on their website.

As a web-based wallet, MetaMask has inherent risks that are not found on hardware wallets. Your funds are still susceptible to software viruses, but you should be fine as long as you follow proper safety guidelines.

Overall: MetaMask is another great option to store your Ethereum. As a bridge to the distributed web, the platform is ideal for people who are looking for a wallet with some additional features.

Guarda

Gaurda is a simple, lightweight, and secure multi9signature wallet that supports Bitcoin, Ethereum, Tether, EOS, TRON and hundreds of other assets.

Users can use Gaurda to buy, sell, and exchange cryptocurrency. Guarda is particularly notable as it allows uers to stake their assets in a relatively user-friendly interface.  

Gaurda was launched primarily for Ethereum in 2017 but has since expanded into a wide variety of blockchain-based products, supporting over 10,000 different tokens, cryptocurrencies, and stablecoins. The company also has an FIU license (reg. FVR000109) for virtual currency on fiat currency exchange. 

Gaurda’s site notes that the company values user privacy and anonymity and that the platform doesn’t store your backup files, private keys, or any other data on Guarda servers. Gaurda’s CEO, Paul Sokolov, has spent over 5 years in the blockchain industry, with interests in custody-free cryptocurrency management and privacy solutions. CMO Maria Carola started at Guarda as a copywriter and has since progressed to oversee all over Guarda’s marketing efforts.

The team offers 24/7 support for its users.

Overall: Gaurda seems to be a great light-weight non-custody solution for a wide variety of tokens. The staking aspect is really neat, and we advise our readers to educate themselves further on the concept before taking action.

Final Thoughts

Before setting you free into the world of Ethereum wallets, let’s go over a few closing words of advice. Make sure you pay attention because these tips could end up saving you a ton of time (and coins) in the future.

  1. ALWAYS back-up your wallets. Many of the above wallets present the option to use a pneumonic or seed phrase just in case something happens to your wallet. This is pretty standard, but be sure to check if it’s not explicitly stated. It’s silly to lose all your coins because you lost your phone or fried your hard drive.
  2. Add extra security. Simple extra security measures such as 2 Factor Authentication through Google Authentication could save you from being hacked in the future. Keep in mind that text message verification isn’t as secure a method since phones can be cloned.
  3. Keep your software updated. This is why it’s important to look for an active development community for whatever wallet you choose. These communities are dedicated to not only making wallets more robust and user-friendly, but they also prioritize security. Take advantage of this. Make sure your software is up to date.

Be sure to keep up with the latest in Ethereum security. The more you know, the better off you will be in investing and protecting your cryptocurrencies.

The post The Best Ethereum Wallet Reviews for 2020 appeared first on CoinCentral.

Source: Coin Central

Does Bitcoin’s Enhancing Anonymity Mean Doomsday for Privacy Coins?

In the early stages of Bitcoin development, most cryptocurrency enthusiasts tended to think that the original digital currency offered them complete anonymity and they could make purchases with this type of “new money” without revealing their identities. The level of Bitcoin’s privacy was often compared to that of Swiss bank clients. However, that was far from the case.

Is Bitcoin anonymous? Bitcoin transactions are recorded in the ledger and broadcast publicly to everyone with access to the blockchain. This means, your money transfers are vulnerable to being traced, and, for hackers or governmental structures, the way to your wallet address can be as evident as a trail of wet footprints leading to a bathroom. Remember Ross Ulbricht, the notorious creator of the Silk Road black market?

Authorities tracked his transactions and were able to identify and catch him while he was sitting with his computer at one of the libraries in San Francisco. So, your financial activity is actually an open book, and Bitcoin should be thought of as more of a pseudonymous asset than anonymous. 

This is why the crypto market saw the phenomenon of privacy-focused protocols gain momentum alongside various coin-mixing tools and services without public records linking transactions to wallets. In simple terms, privacy coins were designed to cover tracks after operating with cryptocurrencies, which made their usage very popular among crypto geeks bent on anonymity.

But recent news regarding Bitcoin’s potential upgrades aimed at improving its privacy seems to threaten the future of this class of digital assets, and may even move some to eliminate Monero, Dash, and ZCash out of their portfolios. To measure the possibility of such a scenario coming true, we need to look at where privacy coins stand now. 

Overall excitement for cryptocurrency during the pandemic

Statistical data from ICO Analytics shows that prominent privacy coins, with DASH (see Dash vs. Bitcoin) leading the way, had outperformed Bitcoin as of January 31, as privacy became a bigger concern in the industry, most likely in response to the People’s Bank of China statement regarding their centralized digital yuan initiative. This was the first time in 18 months that privacy coins had outperformed Bitcoin in price gain, owing mostly to their lack of viable value propositions and the high regulatory scrutiny leveled at them.    

Source: ICO Analytics

The bullish sentiment kept gathering strength after Fed Chairman Jerome Powell’s testimony, in which he noted that privateness is essential for transactions with digital currencies and global crypto adoption: “A ledger where you know everybody’s payments is not something that would be particularly attractive in the context of the US.” The importance of the Fed chief’s stance was highlighted by one of the most famous crypto influencers, Anthony Pompliano, which in turn created hype in the community and led to a spike in privacy coin transactions.

Source: CoinMarketCap

With the COVID-19 crisis, privacy has also become a new battlefield for combating the disease. Monero, ZCash and Dash all witnessed increased trading, while the latter managed to reach new highs and outperformed Bitcoin by over 60% compared to the beginning of the year. Moreover, Dash was among the assets that recovered quickly after the “Black Thursday” market collapse in March. Interestingly, the demand for this coin was caused in large part by Venezuelians, some of whom use it for daily shopping.

Notwithstanding such impressive gains, by the beginning of the second quarter of 2020 there was only one privacy coin outpacing Bitcoin. The coin in question is Monero (see Monero vs. Bitcoin guide), which has improved its performance by around 5%. Some experts think this sudden uptick was a result of several positive developments that were done to improve transaction execution and the way Monero works with privacy networks Tor and I2P. In addition, the cryptocurrency received a great deal of attention from well-known faces in the crypto industry like Coinbase’s CEO Brian Armstrong, who expressed his hope to see privacy coins among the main trends of 2020, and controversial antivirus software developer John McAfee, who named Monero as his cryptocurrency of choice in terms of privacy. Many traders sharing this view seemed to immediately flock to long-standing exchanges that also operate in accordance with anonymity ideals, making the XMR/USDT trading pair on HitBTC the most liquid in the market.

Source: Coin360

With such a significant liquidity margin, it wouldn’t be a mistake to say that the exchange has one of the most conducive environments for trading privacy coins at fair prices, alongside its over 500 other assets.

Bitcoin Illegality concerns and “not-so-private” discourse

Not everyone is bullish on privacy. Detractors of privacy coins emphasize their involvement in illegal transactions conducted on dark markets and insist this outweighs all the arguments made by privacy advocates. Most marketplaces existing on the dark web accept untraceable privacy, thereby skirting anti-money laundering and counter-terrorism financing requirements. Japanese and South Korean regulators are among those fighting hard against anonymous coins, even enforcing local exchanges to delist them.

For example, the Korbit exchange removed five privacy coins in May 2018, citing the South Korean government’s ban on anonymous cryptocurrency transactions. Later on, Tokyo-based CoinCheck stopped its support for several privacy coins, including Monero, Dash and ZCash, when half a million of dollars was stolen from the exchange, despite the fact that none of the cryptocurrencies was used for committing the crime.

Actually, the May report from the Rand Corporation revealed that the majority of illicit transactions (59%) on the darknet use Bitcoin, while the presence of privacy coins widely believed to be the “currencies for criminals” is far less prominent.

Source: RAND DWO

And what is even more interesting is the recent announcement from Chainalysis detailing its support for Dash and ZCash. This means that now almost all of the transactions conducted with these two assets, which fancy themselves as anonymous and untraceable, can be easily tracked. It looks like this sudden move by the U.S.-based crypto analysis company will ease the task for law enforcement agencies and make privacy-focus coins practically useless.

Chainalysis stated that anonymous coins offer a fraction of increased privacy, but nothing close to total anonymity. The company found that only around 1% of transactions executed on the ZCash network can boast maximum privacy, even with enhanced encryption taken into account. As for Dash, that rate falls below 0.7%, which, from a technical point of view, places the privacy aspects of the coin on the same level as those of Bitcoin.

It’s noteworthy that almost two months earlier researchers from Carnegie Mellon University generated similar results through their test-trial of ZCash and Monero traceability. The figures are disappointing: 99.9% of ZEC transactions and 30% of XMR transactions can be easily tracked.

With all that in mind, Bitcoin’s increasing privacy poses an existential threat to anonymous cryptocurrencies that may eventually see less growth and community support, as the first-ever cryptocurrency still has many more resources and much more interest than any of the altcoins.

The prospects of the “Bitcoin vs privacy coins” rivalry

Of course, technologies benefiting Bitcoin’s privacy and efficiencies like the Taproot protocol and Schnorr signatures, enabling cooperative closes to look like regular transactions and remain completely hidden to people from the outside, might take away some of the edges from anonymous cryptocurrencies. Bitcoin Core developer Ryan Havar suggests that the wider BTC user base will be capable of making it more private than its privacy-focused competitors: “Simply put, there’s a lot more Bitcoin users, and use cases. So if you can ‘hide’ in the crowd of Bitcoin users, it’s a much bigger crowd than say ZCash.” 

The situation for privacy coins is marred by the crackdown against them that is gaining momentum in different parts of the world. In March 2020, the head of the French National Assembly ‘s financial committee, Eric Woerth, claimed, “it would also have been appropriate to propose the prohibition of the dissemination and trade of crypto-assets to guarantee complete anonymity by preventing, by their design, any identification procedure.”

However, this doesn’t mean that Monero, ZCash, Dash, and other similar coins will eventually fade into obscurity, as the crypto market is not a zero-sum game where only one asset can maintain popularity. This type of crypto is still in demand with the most valuable privacy coin in terms of market cap, XMR, rising in price by approximately 86% since the beginning of the year. The BTC privacy updates still lie ahead and, while the jury is still out, privacy assets can take advantage of Bitcoin’s current lack of anonymity and fungibility and accelerate their attempts to gain more territory.

The Bitcoin for privacy debate will continue to rage on, so be sure to keep track of updates within the network and any future anonymity tests.

The post Does Bitcoin’s Enhancing Anonymity Mean Doomsday for Privacy Coins? appeared first on CoinCentral.

Source: Coin Central

US Legislators Want USD Digital Currency

US legislators have proposed the development of a US dollar digital currency that will rival the soon to be launched Yuan cryptocurrency. According to the lawmakers, the move would help secure the USD’s position on the global market.

The general consensus is that a national digital currency should be under the control of the Federal Reserve. This would prevent the exploitation of users by manipulative commercial companies.

The American Bankers Association has, however, pushed back against the proposition. It has argued that the Federal Reserve would be transformed into an unstoppable service provider capable of monopolizing its position in the financial sector.

China has been working on its Yuan cryptocurrency for a while now. Its digital coin is currently under trial in major cities such as Suzhou, Chengdu, Shenzhen, and the Xiong’an New Area. There are numerous reasons why Beijing is keen to lead the national digital currency trend.

Is the US Further Weaponizing the Dollar with a Digital Currency?

The US government has slapped crippling embargoes on nations such as North Korea, Iran, and Venezuela. It recently also targeted a collective of Chinese corporations. The Trump administration accused them of aiding the Chinese government in undermining the rights of ethnic Uighurs.

28 Chinese surveillance and related Artificial Intelligence companies, including Hikvision, iFlytek, Megvii, and SenseTime, were blacklisted. The sanctions prohibit US companies, including financial institutions, from dealing with them.

In Iran and Venezuela, the US has devastated their economies by effectively weaponizing the dollar and stopping other countries from using it in transactions with them. The beleaguered nations have also been blocked from the SWIFT international money transfer network, turning them into closed economies.

The fact that China is still heavily reliant on the dollar for international trade makes it vulnerable. This is one reason why the leadership is keen to promote a frictionless global digital currency that is under the control of the PBOC, China’s central bank. A globally accepted digital Yuan would help undercut the USD dominance in Chinese trades.

Although China has signed accords with some nations to secure currency swaps, the agreements cover just over 3.4 trillion Yuan ($4.8 billion) in transactions.

Ultimately, the allure of the US dollar supersedes that of the Yuan across the globe. As such, approximately 60 percent of China’s forex reserves are in the USD currency.

There is a growing risk in holding the dollar because the US recently raised its fiscal deficit. The move is set to negatively impact the value of the currency in the near future.

The rollout of the Yuan cryptocurrency is set to begin on popular Chinese platforms such as WeChat and AliPay.

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Source: Coin Central

Why the FB Libra Network Might Never Take Off

Facebook has demonstrated tremendous resolve in trying to launch its ambitious Libra crypto payment network. The plan, however, faces a few major hurdles.

The first is that Facebook has a long way to go before it can win back public confidence. It lost a great deal of it during the infamous Cambridge Analytica scandal. It exposed its data collection and mining irregularities.

As a result, Facebook has undergone intense regulatory scrutiny by legislatures in both the United States and Europe over the past few years. The platform is effectively banned in China because of its contentious data privacy practices.

Its troubles also seem to be piling up. Most recently, over 180 major companies, including Unilever, Patagonia, Verizon, and Honda, boycotted advertising on the platform due to its failure to curb hate speech and content used to promote violence. The move caused its shares to fall by 8 percent in 24 hours.

Major Jurisdictions Don’t Want a Facebook Payment Network  

India was the first nation to stop the launch of an elaborate FB payment network within its borders. Brazil is the latest country to resist such a move.

Facebook launched its WhatsApp Pay network in Brazil on June 15. The platform was forced to shut down just a week later after Brazilian authorities sounded the alarm on the new venture. Government officials said that significant regulatory scrutiny would have to be undertaken before the company can be allowed to launch the product.

Governments Don’t Want to Cede Control of their National Currencies

The botched Brazil launch highlighted hurdles that the Libra network is bound to encounter when launching in other jurisdictions. The United States, the biggest economy in the world, has already said that there are other concerns besides user privacy, which require greater examination.

Money laundry loopholes are among the main issues that Facebook will have to address before launching Libra. The fact that the platform is set to allow cross-border payments using a basketcoin also means that strict currency regulation measures would also have to be adhered to.

This is because such a system would be able to bypass central banks and allow bad actors to manipulate currency demand and supply to a certain extent, and no nation wants that.

Major Partners Have Left

The Libra network was announced with much fanfare last year, and major payment processors and related companies quickly jumped on the bandwagon. The excitement died down after it became clear that Facebook would control the network’s digital currency wallets dubbed Calibra.

A major exodus ensued due to a lack of clarity on how network partners would monetize the platform since transactions were free.

With major payment processing firms such as PayPal, Visa, MasterCard, eBay, Stripe, and Mercado Pago leaving the project, Libra’s reach is likely to be limited once launched.

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Source: Coin Central