Category: News

The approval for Bitcoin spot ETFs has finally arrived. Here’s everything you need to know. When will trading begin?

The Bitcoin spot ETFs have been approved over six months since BlackRock’s approval request, followed by those of many significant American investment funds.

A few minutes ago, the SEC announced that these financial instruments meet the guidelines. Here are all the details on the approval of the Bitcoin spot ETFs. When will trading of these financial instruments begin, and what will happen to the price of BTC?

Impacts of the approval

The approval of the Bitcoin spot ETFs, widely anticipated in recent months, has finally arrived today, January 10, 2024.

The SEC has approved the applications of ARK 21Shares, Invesco Galaxy, VanEck, WisdomTree, Fidelity, Valkyrie, BlackRock, Grayscale, Bitwise, Hashdex, and Franklin Templeton. The document is available on the SEC’s website.

New institutional players will now be able to offer Bitcoin to their clients, radically changing the perception of the leading cryptocurrency and the entire sector. This development opens up new possibilities based on a more robust image and a positive perception from the general public. Inevitably, the rest of the crypto industry will benefit from this change and the exposure to a new public segment, introducing alternative dynamics.

The crypto world expects the most significant influx of capital in its history. According to some estimates, between 100 and 300 billion dollars could enter the market in the next four years thanks to these financial instruments. If this happens, the impact on the price of Bitcoin will be, to say the least, explosive.

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All you need to know about phone spoofing: what is it and how to protect yourself from the growing scams

Knowing the meaning of phone spoofing is nowadays increasingly important to avoid falling for the scams of malicious attackers, who are constantly ready to steal personal data and money via technological tools. 

Fraud, unfortunately, is now the order of the day, and phones make things much easier for those who try to carry out such frauds. Phone spoofing falls right into this domain, so it’s crucial to clearly understand not only what it means, but above all how to protect yourself from such schemes and how to avoid running into them.

The meaning of telephone spoofing: what it is and types

Literally, the meaning of spoofing is connected to that of deception, cheating. With this type of attack, attackers impersonate another entity by falsifying data in order to gain an illegitimate advantage. This manipulation is based on the ability to deceive systems and users who are led (wrongly) to believe that they are communicating with a trusted source.

It is a technique that is widely used in more general phishing attacks, the ultimate goal of which is to obtain personal information, such as passwords, credit card numbers or financial details. 

To really understand the meaning of spoofing, however, a distinction must be made between the different types of attacks possible. In some cases, victims may receive classic messages on their phones in which the identity of the sender is concealed in order to appear legitimate (SMS spoofing). However, there is not only message spoofing, but also voice spoofing. Malicious attackers can in fact also change phone numbers when making calls to users.

Changing the sender’s numbers and name, by the way, is not such a difficult practice. There are even providers who offer this type of service because, basically, it is not considered illegal. It is only so when it is used to defraud users. Take for instance all those companies that need to send large-scale service messages to their customers and need to hide the sender’s number. In this case, the practice appears perfectly legitimate, whereas the meaning of spoofing changes, taking on a negative connotation when the process is generated to carry out malicious actions and scams. 

Then there is also e-mail spoofing, which, as the name suggests, takes place by sending e-mails. Also not to be forgotten is IP spoofing, with which fraudsters conceal the identity of a server by making the IP address of a host seemingly legitimate, or even DNS server spoofing, in which the compromise of the DNS (Domain Name Service) server results in a redirection to a malicious site. ARP spoofing must also necessarily be taken into account in order to protect oneself: in this case, forged ARP (Address Resolution Protocol) messages are sent by fraudsters.

Regardless of the type of approach adopted, all the various forms of spoofing share a fundamental element: they use trust as leverage to obtain or alter sensitive data, commit financial fraud, circumvent network access control mechanisms, and spread malicious software through malicious links and attachments.

How to protect yourself?

Identifying spoofing attacks has become increasingly difficult today and this is because, as already mentioned, falsifying the identity of senders is anything but difficult. This means that everyone should adopt sound and careful security practices. 

First of all, you should only visit official and notoriously secure sites (with HTTPS protocol). Then you should think carefully about every communication you receive (on any kind of channel), even when the sender seems absolutely trustworthy. 

You should then avoid entering your personal data too confidently and lightly without first having investigated the sender who is requesting that action, and you should obviously carefully analyse all links and attachments contained in received communications. A simple click on them, in fact, could have important repercussions for you. 

The use of strong and robust passwords is also highly recommended. You should avoid using common names that can be linked to you, or easily identifiable dates of birth, and construct highly customised keys that are difficult to find.

Keeping your attention high, therefore, is crucial, but it is not the only thing you can do to protect yourself against spoofing. You could, for instance, decide to use a VPN to make fraud attempts more difficult (hackers would find it difficult to decipher the data of users who have encrypted their traffic). Or you could evaluate services such as blocking cookies, offered for instance by NordVPN’s Threat Protection. You could also use classic antivirus software, which is able to identify attack attempts, and firewalls that can detect addresses outside the local network. 

As already stated at the beginning of this article, knowing the meaning of spoofing is more important than ever, as is keeping alert to the countless fraud attempts to which we are unfortunately now exposed. 

Young Platform takes strong security measures to ensure its reliability and does not ask its users for access credentials and other security codes.

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Discover 5 basic finance concepts to better manage your savings 

When you hear the word ‘finance’, does your brain immediately reply ‘I’ll never understand it’? As a matter of fact, it is one of the most intimidating topics for people, perhaps because it is rich in concepts or because it is associated with large amounts of money and risks, or even because it is considered an elitist world for a few experts. Finance is nothing more than the management of funds and it also has an impact on your daily life, so to manage your money with awareness, it is important to know the basics. Here are 5 basic finance concepts you need to know. 

1. Time value of money

The first of these basic finance concepts is that a sum of money is worth more in the present than in the future. In other words, the value of money decreases over time due to inflation, which reduces purchasing power.  

This means that if you keep €1,000 for five years ‘idle’ under your mattress, its value will drop dramatically over time. And at the same time you will lose the possible gains that your 1,000€ would have yielded once invested. 

The concept of time value of money in fact shows that if money gradually loses value, the only way to make it grow is by investing and that waiting to do so means missing an opportunity.  

This principle is to be taken into account before embarking on any financial strategy. Pension fund managers, for example, consider the time value of money to ensure adequate funds for their clients at retirement.

The time value of money can be calculated using a formula that takes several variables into account: the present value of an amount of money, the time interval, interest and inflation rates.

Compared to fiat currency, there are assets that are less subject to the time value of money principle. These include safe haven assets such as gold and commodities because their scarcity increases their value over time, and for some this category also includes Bitcoin (read the research). 

2. Diversification

To explain the second of the basic concepts of finance, that of diversification, the image of the basket is often used: the rule is ‘never put all your eggs in one basket, if it falls they will all break’. The idea is not to buy a single asset with your savings to avoid losing everything if something goes wrong. Diversification serves to minimise risk and consists of spreading one’s investments across several assets. 

Diversification is also used by crypto users to create a balanced cryptocurrency wallet.

3. Risk/reward

Another of the basic concepts of finance is that of the ‘risk/return’ ratio. This relationship is directly proportional, i.e. the higher the risk, the higher the return and vice versa. In the world of finance, you often hear that ‘There ain’t no such thing as a free lunch’; this expression was popularised by the economist Milton Friedman among others. One cannot have lunch without paying, i.e. in order to have high profits, one must be willing to take risks.  

4. Interests 

Interest is a fundamental component of finance and represents the cost of borrowed money or the gain from a deposit. In a loan, interest represents the amount of money the lender charges the borrower for lending him/her the money. They are usually expressed as a percentage and are paid together with the repayment of the principal (i.e. the amount of money lent) at set intervals, e.g. monthly or annually.

In an investment, on the other hand, interest is the profit earned over a period of time. For example, if you deposit money in a bank account that offers an interest rate of 2% per annum, you will earn 2% on the money deposited each year.

When considering whether to take out a mortgage, looking at the interest rates is crucial. These can be influenced by the monetary policies of the European Central Bank, which decides on interest rates, which then fall on the commercial banks. 

5. Put your money at work 

Of all the basic concepts of finance, this refers to the idea of embarking on a strategy in order to grow one’s savings and thus achieve a return. 

In this way, the money ‘works’ for you, producing results. Obviously every investment has its risk component, the idea behind ‘putting your money at work’ is to try to get a higher return than you could get by simply keeping your money in a bank account or under your mattress.

In summary, ‘put your money at work’ is an invitation to consider investing as a way to grow your money and achieve your long-term financial goals. 

These were the 5 basic finance concepts worth knowing. Not as incomprehensible as you thought, right?

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Comparing the best investment strategies: should we wait for the right moment to invest or buy regularly?

The first thing to consider when choosing your investment strategies is time: is there a right time to invest? If you too have thought at least once about making your savings pay off, without knowing when to start, there is good news: you can start now and get results even without being a financial guru and spending all day interpreting numbers and charts. 

According to research by Charles Schwab, a multinational financial services company, waiting for the right time to enter a market is very expensive. In other words, buying an asset by trying to calculate ideal market conditions is less convenient than relying on a recurring purchase. 

Is market timing the best investment strategy?

The purpose of Charles Schwab’s 2021 analysis, which we will present in this article, is to understand whether market timing works. That is, to seek an answer to the question: is there a right time to invest? The term ‘market timing’ refers to the attempt to find the best time to buy or sell an asset. You can consider market timing as one of the investment strategies adopted by investors who try to anticipate market movements and, for example, sell before a fall and buy before a rise. For the company’s analysts, market timing does not help to make one’s savings pay off. Let’s see how they came to this conclusion. 

The 5 investors’ thought experiment 

Charles Schwab scholars conducted a thought experiment on five different investment strategies. Each investor was given a $2,000 budget per year to invest in the S&P 500, the most important US stock index, for twenty years, from 2000 to 2020. 

1. Peter Perfect

Peter is the perfect market timer, that friend who is always successful at what he does. By skill or luck, he has managed to place his annual $2,000 by always finding the right time to invest. For example, in 2001 he waited until 21 September, the lowest closing level of that year for the S&P 500.

1. Ashley Action

Her investment strategy is simple and consistent: each year she invested $2,000 in the market on the first day of the year. 

1. Matthew Monthly 

Matthew divided his budget into 12 equal shares that he invested at the beginning of each month, with a strategy called dollar cost averaging that can be implemented with recurring and automatic purchases.

1. Rosie Rotten

The fourth investor had poor timing and a lot of bad luck: she placed $2,000 each year at peak market times. For example, Rosie invested her first $2,000 on 30 January 2001, the highest closing level of that year for the S&P 500.

1. Larry Linger

He, waiting for the right time, never invested in stocks but kept his budget in cash or Treasury bonds. 

At the end of twenty years of investment, the profits are as ranked below: 

1. Peter Perfect: $151,391
2. Ashley Action: $135,471
3. Matthew Monthly: $134,856
4. Rosie Rotten: $121,171
5. Larry Linger: $44,438

So what was the best investment strategy?

The best results of course are Peter’s who waited and planned his annual investments perfectly. But the most surprising and least expected results of the study concern Matthew and Ashley, the latter coming in with only $15,920 less than the first ranked and Matthew with only $16,535 less. Matthew’s recurring purchase approach performed well. The difference in profits is relatively small, considering that he simply invested regularly without calculating timing or market forecasts.

Another obvious consequence of the research is that even bad timing still wins out over inertia. Although Rosie lost $14,300 compared to Ashley (who did not try to predict the market), Rosie still made almost three times what she would have made if she had not invested at all.

To sum up, the experiment shows that it’s worthwhile to invest now, and not to wait for supposed better times. And that putting one’s savings in motion even in a difficult market moment is still better than not investing at all. 

Charles Schwab examined 76 other 20-year periods and almost always found similar results in the ranking of investors for their returns. Even in periods with unexpected rankings, those who invested early never came last. 

What all this means for you

If you have a budget to invest in some market and do not know the best time to do so, starting now and on a regular basis could be the winning choice. 

The benefits of market timing do not stand out; this investment strategy only pays off for those with the skills or luck to anticipate trends. Regularity is less risky and more efficient. 

The winning choice of recurring purchase 

If you do not have the possibility or do not feel like spending your entire annual budget at once, consider recurring purchases. This way you can place smaller amounts more frequently. Recurring purchase has the advantage of: 

1. Preventing laziness: this research shows that the ‘I’ll do it later’ or ‘maybe it’s better to wait’ approach does not work at all; 
2. Minimise the stress of those who seek the perfect moments at all costs and the regrets of large investments that have failed; 
3. Untie your profits from the timing of the market and its volatility. 

The best investment strategies? There is no such thing! The research concludes that, given the difficulty of predicting the market, the most realistic strategy for most investors is to set up recurring purchases. 

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What is MiCA and what is the crypto regulation governing the market in the Eurozone? Read the full guide

What is MiCA (Markets in Crypto Assets) and what does the European regulation that will regulate the cryptocurrency market in the Eurozone mean? The main aims of this regulatory package, which has already been approved by the Council and the European Commission, are to ensure investor protection and to prevent money laundering. The regulation also lays the foundation for future innovations, such as the establishment of a European cryptocurrency. So find out in detail what MiCA is, what the crypto regulation really provides for, and what will change in the industry thanks to it?

MiCA crypto regulation: what it is and what it stipulates

The MiCA is the first EU regulation governing the cryptocurrency sector. Its articles will regulate both centralised exchanges, stablecoins and the entities that issue them. DeFi, on the other hand, does not fall under the MiCA framework, nor do NFTs. The discourse on non-fungible tokens, however, is not yet closed, and further guidance may be forthcoming. For now, it seems that it will be left to individual countries to decide whether to consider NFTs as crypto-assets or not. 

The plenary vote to finally approve the regulatory document, which is expected to take place in the week of 17-21 April, will be in the hands of the European Parliament. If the MiCA is finally approved, EU countries will have 18 months to amend their domestic legislation accordingly.

In order to fully understand not only what the MiCA is but also what it provides for, let us see what topics are covered by its articles and how.

What changes with the new European crypto regulations?

Now that you know what MiCA is, it is time to better understand what it provides for and how it will change the European situation after its entry into force. The regulation represents a real revolution for the European cryptocurrency market as it introduces common regulations for all EU countries. 

The first major change that catches the eye is the obligation for operators in the sector to register with the competent authorities of the countries in which they operate. The harmonisation of regulations in the various Member States will probably make it possible to protect users more effectively and prosecute criminals more easily.

So let’s find out what MiCA is through the main points that are covered within it.

MiCA: what it means for stablecoins

The MiCA provides for specific regulations for stablecoins. This type of cryptocurrency will be divided by the European legislation into two categories: ‘electronic money tokens’ (EMTs) and ‘asset-referenced tokens’ (ARTs). EMTs, according to the European Commission, are cryptocurrencies with characteristics similar to the ‘digital coins’ we use daily for payments. It is not clear what this expression refers to, according to experts it could include CBDCs (digital coins issued by central banks) which will be subject to the rules applicable to payment services of the country in which they are issued. ARTs, on the other hand, are tokens that aim to “maintain a stable value by reference to any other asset or a combination thereof, including one or more official currencies”. Thus, the most famous stablecoins such as USDT or PAXG belong to this group; cryptocurrencies whose price is pegged to that of physical assets, such as fiat currencies or gold. 

According to the new laws, moreover, European institutions issuing stablecoins will have to hold protected and liquid reserves in a 1:1 ratio. Supervising the reserves will be the EBA (European Banking Authority). MiCA, however, does not explain what will happen to algorithmic stablecoins, which are known to be anchored not with physical reserves but with complex mathematical formulas. 

MiCA: what does it provide for utility tokens?

The MiCA defines cryptos that are neither EMT nor ART as utility tokens. Companies that issue this type of token are required to draw up a specific document, the White paper, to be published on the website owned by the organisation issuing the cryptocurrency.

This document should contain all fundamental information about the token, such as: a detailed description of the project, how the crypto will be issued and sold, and the technologies on which it is based.

MiCA: what it provides for exchanges 

To answer the question what the MiCA is, we cannot leave out the articles that will regulate exchanges, i.e. platforms that allow the purchase, sale and swap of cryptocurrencies. First of all, centralised exchanges and platforms providing this type of service, defined by the MiCA as ‘crypto-asset service providers’ (CASP), will have to be registered with the competent authority of the country in which they operate.

The new framework will also hold CASPs directly liable in case of bugs, exploits or insolvency. This will ensure that users are compensated if part of the platforms’ capital is lost. Furthermore, CASPs will have to keep a history of all transactions processed on their platform for at least five years.

As far as anti-money laundering is concerned, monitoring and enforcement will be entrusted to the EBA (European Banking Authority). The body will also have a register of companies that are not allowed to conduct CASP activities in the EU, which it will use to limit the entry of organisations considered to be at ‘high risk’ of money laundering.

In addition, all companies dealing with Proof-of-Work crypto-assets will have to regularly submit documents proving their environmental impact. MiCA will not ban PoW cryptocurrencies, but will limit their spread by cutting public incentives directed towards this type of technology. Bitcoin is therefore safe, and will not be banned by the new European crypto law.

Exchange wallets and private wallets: what changes with MiCA?

Also with regard to the regulation of crypto wallets, European laws aim to protect users. P2P payments between individuals via cryptocurrency will not be affected. Exchanging crypto from one centralised exchange to another, on the other hand, may become more cumbersome, as it appears that controls will be increased for these transactions.  

Finally, MiCA will also deal with the impact of crypto influencers, those who express personal opinions on certain cryptocurrencies by recommending them to their followers on social networks. The bill provides for penalties for those who do not behave transparently: expressing opinions on a particular asset without disclosing their exposure.

The current regulatory environment of cryptocurrencies

To date, the European regulatory situation on crypto is highly fragmented and evolving. Each country has adopted its own laws, making regulatory harmonisation difficult. France, for instance, has regulations for ICOs (Initial Coin Offering), whereas Germany has classified crypto as digital currencies and subjected them to specific taxation some time ago. Italy has also introduced taxation of cryptocurrencies within the last budget law.

Some opinions from the industry

Crypto enthusiasts have known what the MiCA is and what it means for crypto for several months. The first draft of the document was in fact drafted in 2020, so they have had plenty of time to get their minds around this regulation. According to some experts, MiCA will have a positive impact on the industry. The consumer protection provided by the new framework serves to make the crypto world more accessible. In addition, the new rules prevent suspicious or questionable companies from entering the European market, reducing the risk of scams or rug pulls. According to Dante Disparte, Circle‘s Head of Global Policy, the laws will serve to transform the European Union into a competitive and innovative crypto terrain.

On the other hand, critics think that these new European laws could have negative effects on the market. Mainly because some transactions that, as of today, are carried out immediately, such as transactions between exchange wallets and withdrawals of large amounts of crypto, could become complicated. Critics therefore believe that this will slow down the adoption of cryptocurrencies.

In general, however, the opinions of members of the crypto community who have long known what MiCA is and what it means are positive. After all, most of the pioneers in the field (such as Charles Hoskinson and Andre Cronje) have always been in favour of cryptocurrency regulation. 

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Why you should consider buying Bitcoin regularly explained in 3 charts

Buying Bitcoin through recurring purchases is cheaper than spot buying by constantly looking for the perfect moment to enter the market (spoiler: it does not exist). We’re going to show you this with three charts: you’ll see that the drawdown is lower, as is the volatility and average price. Recurring purchasing is the most effective strategy to set aside Bitcoin regularly and automatically and you can set it up in your Moneybox. 

We ran a simulation based on historical market data on the price of BTC, and imagined a recurring purchase of €50 in Bitcoin per week from January 2020 to March 2023. Here are our results. 

A positive performance for 80% of the period 

Maybe you have some regrets about 2020 spent on the couch in your pyjamas… Today we add to the list not having set up a recurring purchase on the Moneybox. If you had decided to spend €50 per week to buy Bitcoin automatically now your situation would be as described by this chart. 

Here you can see the value your wallet would have had in March 2023. The yellow line indicates the total amount spent to buy BTC, the green line is the value of your holdings (+22.5%). The moneybox represented by the graph was in the positive for 86.2% of the time considered. With the best performance at +71.43 and the worst at -30.77%. 

Wouldn’t it have been cheaper to buy Bitcoin at its lows instead of at any time? If you have this doubt, read the results of this research which shows that there is actually no such thing as the ‘perfect moment’. Predicting market movements is not for everyone, recurring buying removes this difficulty and still leads to good results. 

Even in a bear market the losses are smaller

In this second graph, the blue line shows the price of BTC from March 2022 to March 2023, the green line the percentage return (profit and loss) of the holder that chose to buy Bitcoin with recurring purchases. 

According to the analysed data, the drawdown, i.e. the maximum loss that can occur in a time interval, is smaller compared to that of a single purchase. In the period considered, from the beginning of March last year with BTC at $45,000 to March 2023, there would have been a maximum drawdown of 20% compared to the -64% recorded by the price of Bitcoin. In short, the recurring buyer would be in profit by 16% after one year. 

The savings are obvious

In these times of inflation, saving money is becoming a mission for most people. If you are looking for a way to buy Bitcoin while optimising your spending, recurring purchasing is again an option you might consider. Let’s look at the third chart. 

The blue line shows the price of BTC from January 2020 to January 2023, while the red line shows the average price paid to buy Bitcoin with recurring purchases. Considering that the cryptocurrency has a bullish trend over large time intervals, the result is that with recurring purchases over the long term, you can get a very good average purchase price compared to the market value. In January 2022 buying spot would have been around $5,000, with recurring buying instead less than $2,000. This is not because there are different prices in the same period, but because the price of the recurring purchase averages out all levels by also including purchases made when the cryptocurrency was at its lowest. 

Again you may ask yourself if buying at lows is not the best thing to do, theoretically the answer is yes. But again ‘lows’ are not easy to predict, so buying on a regular basis is a good trade-off to avoid fretting over ‘impromptu’ market analysis and instead buy Bitcoin conveniently. 

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*The information in this article is for educational purposes and is not an incentive to invest. It is based on historical and objective Bitcoin market data, charts do not represent future predictions. The performance of any cryptocurrency wallet is always subject to market conditions and volatility. 

Everything you need to know about Polygon zkEVM, Ethereum’s Layer 2 that exploits zero-knowledge technology

We’re live: the Polygon zkEVM mainnet beta went online on 27 March. MATIC‘s blockchain team announced on 20 July 2022 the development of an innovative scalability solution for Ethereum (Layer 2), capable of improving the performance of the entire industry. Thus, the Polygon zkEVM was born, combining zero-knowledge (ZK) technology and compatibility with the Ethereum Virtual Machine. 

The project has become the most eagerly awaited tech news in recent months, so much so that 2023 has been dubbed the year of ‘zero-knowledge’.  

Now that the mainnet beta is live, here’s everything you need to know about Polygon zkEVM, Ethereum’s latest scalability innovation!

Polygon zkEVM: blockchain focuses on zero-knowledge

For Ethereum, there is no more pressing challenge than scalability. The increasing amount of dapps and DeFi services using its network are testing its efficiency. The number of transactions to be processed increases day by day and according to Polygon, the most promising solution to meet this challenge are Layer 2s based on zero-knowledge technology. Which allows so many transactions to be processed at once and at a reduced cost. 

One type of Layer 2 derived from this technology are rollups. These aggregate a series of  off-chain transactions into a ‘rollup’ that is transferred to the reference Layer 1 blockchain with one and only one proof of validity for all transactions (zero-knowledge proof). In other words, transactions are not verified one by one, transferring a large amount of data to Ethereum. Everything is reduced to a single step.

This makes the finalisation of transactions and the amount of data that ends up on the blockchain lighter. Polygon zkEVM rollups allow instantaneous transactions unlike other types such as optimistic rollups, chosen as a scalability solution by protocols such as Arbitrium and Optimism. 

Zero-knowledge rollups: pros and cons

Although promising, zk rollups are an underused technology as a scalability solution for Ethereum. In general, these take a long time to develop and are expensive to integrate. Most importantly, in most cases, they are not compatible with the Ethereum Virtual Machine and are therefore not interoperable with Ethereum. 

Compatibility is crucial because it allows different projects to be standardised and interchangeable with each other, facilitating the exchange of information and value. 

Polygon decided to work precisely on this weakness of zk rollups: ‘We knew that Ethereum needed to scale. We knew that ZK Proofs were the best way to do so. We knew that EVM-equivalence was the secret sauce that would empower both devs and users. So we built Polygon zkEVM”. 

The Polygon zkEVM mainnet beta that went online on 27 March is thus a zero-knowledge Layer 2 solution for scaling Ethereum, that is fully compatible with the EVM. 

We are proud to announce a giant leap forward for Ethereum scaling and ZK innovation.

Introducing Polygon #zkEVM, the first EVM-equivalent ZK L2.

Today we’re releasing a complete implementation, fully open-source, and we’re just getting started.

[1/6] pic.twitter.com/P929DRCT1y

— Polygon (labs) (@0xPolygonLabs) July 20, 2022

Polygon zkEVM: why it’s really news

Zk rollups yes, but compatible with Ethereum. This is Polygon‘s project that is finally a reality! Basically, not being EVM compatible is a big disadvantage, it means not being able to use the same programming language as Ethereum (Solidity), its code or development tools. The problem with zk rollups is therefore one of usability. 

When you’ve been working for months and achieve an important milestone@0xPolygon #zkEVM team! Emotional clicks from EthCC pic.twitter.com/JRRWB0GweX

— Sandeep Nailwal | sandeep. polygon 💜 (@sandeepnailwal) July 20, 2022

Polygon zkEVM however is a Layer 2 that can be used exactly like Ethereum. Developers and users can find the same security and decentralisation of the ETH network but more speed and convenience. 

Polygon zkEVM: what changes now for blockchain

To summarise, the advantages of Polygon zkEVM are: 

• More scalability and security for the network;
• Lower transaction processing costs;
• Faster transaction finalisation times;
• Compatibility with Ethereum, the most widely used smart contract platform.

So what is going to change with the arrival of the Polygon zkEVM mainnet beta? The first immediate consequence according to the project team is that the cost of transaction fees on Layer 1 (i.e. on Polygon itself) will decrease by 90%. 

Moreover, thanks to full compatibility with EVM, Web3 developers who want to improve the performance of their dapps built on Ethereum can simply transfer the execution of existing smart contracts to Layer 2. 

Polygon zkEVM: first applications

The Polygon team explained that the main applications of Polygon zkEVM will be in the field of DeFi dapps, NFTs, blockchain gaming and payments. 

One of the first projects to have chosen the Polygon zkEVM to scale its activities is ImmutableX, the blockchain dedicated to crypto gaming that has always used zk rollups since its foundation.  

Earlier this month, Polygon unveiled a new product built on its zkEVM: Polygon ID. It is a service for verifying one’s digital identity, in which users can register credentials in a wallet via smart contract. The owner of a café, for instance, could verify the age of a customer even without documents. Or developers could build decentralised solutions for KYC. 

After the launch of the Polygon zkEVM mainnet beta on 27 March, we will see further applications of the new scalability solution. Which has all the makings of setting new tech standards for blockchain and its development. 

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Research compares Bitcoin and traditional financial assets in the fight against inflation

How to hedge against inflation? A legitimate question given the recent trend in consumer prices. Well, Bitcoin turns out to be an effective hedge against inflation according to research from 2022 published in Axioms, an international academic journal supported by The European Society for Fuzzy Logic and Technology (EUSFLAT), International Fuzzy Systems Association (IFSA) and Union of Slovak Mathematicians and Physicists (JSMF). 

In this article we will explain why:

• Bitcoin is the asset that responds better than other safe haven assets in both stable and turbulent market times; 
• Recurring buying (or DCA) is the best strategy to enter a market (whatever its trend may be); 

Hedging against inflation? Bitcoin beats the competition

In the economic climate in which we live, characterised by rising prices and stagnating wages, it is legitimate to try to understand how to hedge against inflation. And thus protect our savings. 

The research entitled “Do Bitcoin and Traditional Financial Assets Act as an Inflation Hedge during Stable and Turbulent Markets? Evidence from High Cryptocurrency Adoption Countries‘, compares the effectiveness of different strategies and instruments to combat inflation using those with high cryptocurrency adoption as sample countries. 

In summary, what has emerged is that Bitcoin is better protected against inflationary shocks than other traditional assets such as shares, gold and oil.

On Young Platform with the ‘Recurring Purchase‘ feature you can set aside Bitcoins automatically and with an amount and frequency of your choice.

What is inflation? 

When wondering how to hedge against inflation, it is worth making a few conceptual clarifications. Inflation refers to the increase in the prices of the goods and services we buy every day, which leads to a reduction in the purchasing power of money. In other words, we can buy fewer things with our savings than in the past. 

For example, in the US in 1980 going to the cinema cost only $2.89, in 2019 the average price of a ticket increased to $9.16! So with a $10 note in 1980 we would have bought 3 tickets, but today only 1. 

Solutions against inflation 

You may have heard that one of the most effective solutions to respond to rising prices is to invest ‘in bricks and mortar’. For a long time, real estate has been a safe haven for our savings, but it is not always a viable option for those who are perhaps younger and do not have much liquidity. 

In any case, this option reminds us that the important thing is to defend our own savings by converting them into an asset that is more resilient than money, whose value is maintained over time, such as a safe haven asset. This is because keeping your earnings ‘under the mattress’ does not bring results in the long term, as they gradually lose their value due to inflation.  

Investors try to hedge against inflation by buying assets that increase in value when prices rise, such as shares in companies that produce commodities or raw materials. Other examples are gold and oil. In short, the rule applies: investing is better than saving. 

Beyond gold and oil: how to hedge against inflation with Bitcoin 

Are gold, stocks and oil really the only ways to hedge against inflation? There are those who advocate relying on Bitcoin, but can it work as a hedge? At first it is difficult to answer this question with certainty. After all, Bitcoin is a new asset that needs to be studied in its own right, in relation to its target market. 

The analysis presented by Axioms experts tries to answer this doubt. See the results. 

First, it is noted that in order to assess how well an asset can hedge against inflation, several factors must be taken into account. Such as inflation trends over time and the national territories studied. Which in the case of this research are 10.  

In short, there are some assets that can offer protection in the short to medium term, such as Bitcoin, gold, stocks or oil. For the long term things get complicated, the levels of effectiveness against inflation are more heterogeneous and it is not easy to find a better and definitive asset.

However, Bitcoin seems to be an attractive option for countries with high cryptocurrency adoption. In times of increased economic turbulence, Bitcoin is the asset that statically responds best to market downturns. But what does this mean for investors?

To avoid inflation, you should consider leveraging BTC to create a hedge during a market downturn or when asset prices respond to inflation more quickly.  

Secondly, research results show that Bitcoin is the most effective inflation hedging instrument for most countries, both in stable and turbulent economic regimes. With a peak especially in countries with less resilient economies. This could be an advantage that every government should consider when developing cryptocurrency regulations.

What is the best strategy? 

To hedge against inflation, however, it is not enough to choose the right asset, this must be combined with a strategy. That of regularity. 

The analysis conducted by the Charles Schwab Corporation, a US investment firm that manages over $7 trillion in assets for its clients, compares five investor profiles and calculates their performance over five years, assuming each has $2,000 to invest each year. 

Here is the result: in first place is the trader who – by preparation or luck – chooses the timing perfectly and buys at the correct time. They are followed in second and third place by those who invested the $2,000 every year in one lump sum and those who broke it up into 12 installments and entered regularly every month. Closing the ranking with the worst results are those who bought at the wrong time – driven by FOMO or through extreme bad luck – and those who did nothing and obstinately kept their liquidity on their savings account. 

The good news is that for ordinary mortals who are not traders or do not feel kissed by luck, there are great opportunities to get the most out of their investments through regularity. That is, by regularly buying a certain asset. This strategy is called recurring buying or (DCA). 

Sticking to the terms of the analysis, if we had bought €25 worth of Bitcoin once a week for 5 years, as of today (March 2023) we would have €6,925 in Bitcoin but with a portfolio value of €15,803, i.e. a net gain of €8,800 (+128%). 

Conclusions 

In summary, those who are trying to figure out how to hedge against inflation should keep in mind that no asset can offer complete protection in the long run. But assets like Bitcoin can be a good option in the short to medium term. In any case, it is always important to pay attention to asset selection and the timing of investments.

***

*This article was written on the basis of research published in Axioms, an international, peer-reviewed, open-access academic journal covering mathematics, mathematical logic and mathematical physics, published monthly online by MDPI. Aximos is supported by The European Society for Fuzzy Logic and Technology (EUSFLAT), International Fuzzy Systems Association (IFSA) and Union of Slovak Mathematicians and Physicists (JSMF). To read the full research, download the PDF at this link.  

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In just a few days, billionaire Gautam Adani lost a large part of his fortune. What happened to the Adani Group? 

The collapse of the Adani Group was a major blow to the Indian economy. In just a few days, billionaire Gautam Adani’s empire lost significant shares, estimated at around $100 billion. 

Adani Group: the collapse and financial scandal

What triggered the collapse of the Adani Group were the serious allegations made by the US firm Hindenburg Research. On 24 January 2023, the Indian giant was accused of using tax havens, tax fraud, share value manipulation and unsustainable debt. Hindenburg placed the main emphasis on the high debt. 

Adani Group CFO Jugeshinder Singh called the Hindenburg report a ‘malicious combination of selective misinformation and stale, unfounded and discredited allegations’. Singh stated that the company has always complied with all laws and suggested that the allegations had a devious purpose. 

Singh was referring to the upcoming IPO (Initial Public Offering) of Adani Enterprise, the flagship branch of the group, which was to be listed on 27 January with the aim of raising USD 2.5 billion. According to the CFO, Hindenburg would have exposed itself at a crucial moment, just in time to block the IPO. Which indeed happened, the Enterprise’s IPO was cancelled, marking the peak of Adani Group’s collapse. 

Hindenburg’s accusations had immediate effects. The group’s seven listed companies lost a total of $10.73 billion in market capitalisation in one day. Just as Gautam Adani’s net worth dropped from $126.4 billion to $120 billion. Moreover, a large number of investors abandoned Adani Group.

Finally, the Indian market regulator, the Securities and Exchange Board of India (SEBI), started an investigation (still ongoing) to confirm or deny the validity of the allegations made. 

Adani Group vs Hindenburg Research

In the early stages of this affair, Adani Group hinted that it would take legal action against Hindenburg. The latter in turn commented on Twitter: 

Our response to Adani: pic.twitter.com/6NcFKR8gEL

— Hindenburg Research (@HindenburgRes) January 26, 2023

Who is behind Hindenburg?

Hindenburg Research is a forensic financial research firm that analyses equities, credit and derivatives, founded in 2017 by Nathan Anderson. On its website, Hindenburg says they look for “man-made disasters” such as accounting irregularities, mismanagement and suspicious transactions. And on Twitter they specify ‘we burst bubbles where we see them’. 

The firm was named after the Hindenburg airship disaster that caught fire in 1937 while flying towards New Jersey. 

After identifying potential wrongdoing, Hindenburg publishes a report explaining the case and bets against the targeted company, hoping to make a profit. According to its website, Hindenburg has reported at least 16 companies since 2017. 

Gautam Adani, who is the Indian billionaire?

Before the collapse of Adani Group, Gautam was the third richest person in the world. According to Forbes, he is now at the 32nd position in this ranking. 

The entrepreneur, originally from Gujarat in western India, built his empire from scratch after starting his career as a commodities trader. He was born on 24 June 1962 into a large family, consisting of his textile dealer father, mother and seven siblings.

After compulsory schooling, Adani enrolled in the Faculty of Economics at the University of Gujarat, but dropped out after two years. He then moved to Mumbai with just over a hundred dollars in his pocket, where he started working as a diamond selector for Mahendra Brothers. After three years in the diamond business, he opened his own company, but the real turning point came when his older brother asked for his help in handling a large shipment of plastic that he had purchased. From there, he began his career in the commodities business that led him to found the Adani Group in 1988. 

This is not the first time that Gautam has ended up at the centre of a scandal. He is in the spotlight mainly because of his friendly relationship with Narendra Modi, the Indian Prime Minister. The latter, as a supporter of Adani, found himself in trouble in the face of Hindenburg’s accusations. This is why the issue also took a political turn.  

The most recent controversy that has engulfed Adani concerns the protest of some fishermen against the construction of a $900 million port in Kerala, southern India. 

Also in Australia, environmental activists have been protesting for years against the Carmichael coal mine project by Adani in Queensland, over carbon emissions and damage to the Great Barrier Reef.

Adani Group: what does it do? 

Adani Group is a conglomerate, i.e. a company that operates in several sectors through separate subsidiaries. The company was founded in 1988 and is based in Ahmedabad, in the Indian state of Gujarat. The company operates in various sectors, including energy, transport, agriculture, logistics and utilities. Some branches of the group are the aforementioned, Adani Enterprise, Green Energy, Power, Ports & SEZ.

The group is one of the largest private power producers in India, with a renewable energy generation capacity of over 18,000 MW. 

Its growth has been large and remarkable over time thanks to a strategy of diversification and acquisitions. It has a global presence and also operates in Australia. United Arab Emirates, Bangladesh and Myanmar. 

By November 2022 it was the second largest conglomerate in India. 

But the company does not only have industrial interests, the company also owns several sports teams such as the Gujarat Giants of the Pro Kabaddi League and the Gulf Giants of the Cricket League.  

Simple allegations, which have not yet been confirmed, led to the sudden collapse of the Adani Group. However, this is not a definitive exit or bankruptcy. Until the investigations are concluded for Indian billionaire Gautam Adani, the game is still open. 

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Metaverse Fashion Week 2023 is coming. Which haute couture brands will parade in Decentraland? 

Decentraland’s Metaverse Fashion Week 2023 is just around the corner! According to a study by Gartner dated 7 February 2022, in 2026 25% of the global population will spend at least one hour a day in the Metaverse “for work, shopping, education, social interactions and entertainment”. Considering that 2026 is only three years away, it is safe to say that this virtual world will soon be part of our everyday life. The fashion industry seems to be the most advanced as far as this new technology is concerned and the second Metaverse Fashion Week in history will take place from 28 to 31 March 2023. 

The Metaverse chosen for the occasion is once again Decentraland (MANA), which has already hosted the 2022 edition. This year’s theme mixes tradition and innovation through collaborations between new generation designers and historically established fashion brands. Find out all about the event and the brands that will be guests at Metaverse Fashion Week 2023!

Metaverse Fashion Week 2023: how to access

Metaverse Fashion Week was created to let the public experience fashion from different perspectives and to make it accessible to everyone, not just insiders. To enter Decentraland’s metaverse and thus participate in the events of this fashion week, you simply have to connect your crypto wallet or visit the virtual world in guest mode. Decentraland has already provided the coordinates of all the areas where the events will take place and with a simple click (‘jump in’) you can reach afterparties, digital shops, fashion shows and conferences organised by many brands. 

The Metaverse Fashion Week 2023 calendar

Below you can find a selection of events from the eagerly awaited Decentraland virtual fashion week 

28 March 

• 00:00 UTC, Fashion District: Metaverse Fashion Week 2023 opening event – DJ Set by ‘KDS’ and discussion on the future of fashion in the metaverse;
• 14:14 UTC, Genesis Plaza: “CRISTÓBAL BALENCIAGA: NEW CODE” – Haute couture evening dresses inspired by the designs of Cristòbal Balenciaga;
• 14:14 UTC, Decentraland South, Neo Plaza: ” META FASHION HOUSE IN THE NEO PLAZA FEATURING 3DMETADRESS” – The augmented reality presentation of the digital clothing that will be physically produced for NFT Week New York 2023;
• 18:18 UTC, Genesis Plaza: “HAUS OF FUEGO FASHION SHOW!” – The Nikki Fuego avatar fashion show, inspired by cyberpunk and high tech culture.

29 March

• 00:00 UTC, Adjacent District: “THE TRAVELER PARKA” CO-CREATION @SAKOASKO AND @KAFTANCREADOR” – The second day of Metaverse Fashion Week 2023 will open with an event dedicated to Latin American artists from the metaverse;
• 21:21 UTC, Binary Code Building: ‘FASHION SPACES: MERCURY DASHA X RENOVI STUDIOS’ – The fashion show of the ‘urban-luxe’ collection resulting from the collaboration between the two brands (Mercury Dasha and Renovi Studio);
• 22:22 UTC, Valhalla: ‘METAVERSE FASHION WEEK BY DECENTRALAND (MVFW) AFTER PARTY’ – A concert featuring various musicians from the Decentraland community.

30 March

• UTC, Uniquely.io Land: ‘METAVERSE FASHION WEEK MEETING BY UNIQLY.IO & PUNKSCLUB’ – Debate on the relationship between fashion and NFT followed by a DJ Set;
• 16:16 UTC, The Crypto Valley “NTR1-META” – A party in the metaverse organised by the digital sneakers brand of the same name;

31 March

• 21:21 UTC, Dlan Holding 004: “DKNY.3 X MVFW23 CLOSING NIGHT PARTY” – The closing party of Metaverse Fashion Week 2023

This calendar is generic and does not present the events organised by the most famous brands, these have their own customised LANDs where their respective programmes will be staged. But which of these big brands have decided to participate?

Dolce and Gabbana

Among the brands that have already shown in Decentraland during Metaverse Fashion Week 2022 is Dolce and Gabbana. D&G’s journey into the Metaverse began in 2021 and after several NFT collections that expanded the brand’s artistic and craftsmanship potential, it organised its own fashion show in Decentraland. During the 2023 edition, the historic Italian brand will present a selection of the winning entries of the Future Reward competition. The designs were chosen by Domenico Dolce and Stefano Gabbana themselves and are all digital wearables.

Tommy Hilfiger

Tommy Hilfiger opened its digital shop in the Boson Portal District during 2022 and is making its second appearance at Metaverse Fashion Week. Last year, users were able to buy some limited edition products from the Spring 2022 collection in NFT format and have them worn by their avatars. For the 2023 event, new digital garments designed by artificial intelligence will be released every day and a challenge will be held among the community of aspiring designers attending the event. The winner will be selected by Tommy Hilfiger himself!

Adidas

At Metaverse Fashion Week 2023 Adidas will present the ‘adidas virtual gear‘ collection, a collection of cyberpunk and high-tech inspired garments that will be produced in both physical and digital versions. These include a personal flotation device, a life jacket built for space.

Clarks

The British footwear brand will be present at Metaverse Fashion Week 2023 with its own dedicated area called ‘Clarks Arcade’ – part amusement park and part disco. Within this space, people will be able to try out Clarks-themed video games and compete with others at dance competitions. This is not the first experience in the Metaverse for the shoe brand, which had already landed on Roblox in May 2022 to present its trainer for kids, ‘Cica’.

Decentraland Fashion Week 2022

Metaverse Fashion Week 2023, which will be held from 28 to 31 March, is the second edition ever; the first was last year and was very well received by the community and brands. Among the main events of the past year, besides those already mentioned by Dolce and Gabbana and Tommy Hilfiger, was Philipp Plein. The German brand presented its space on Decentraland, the Plein Plaza, in which it exhibited works from the NFT Museum of the Arts (M.O.N.A).

The Liquid Paisley collection straight from the catwalk during the first Metaverse Fashion Week in @decentraland in partnership with @UNXD_NFT. #MVFW pic.twitter.com/CvljDudD1Z

— ETRO (@EtroOfficial) March 25, 2022

Etro‘s event was also a success. The ‘liquid paisley’ motif reinterpreted by the brand in a contemporary way and presented at Metaverse Fashion Week 2022 was also back in fashion in the real world. Hogan‘s event, on the other hand, featured guest Bob Sinclar who played at the after party.

Why a Fashion Week in the Metaverse?

The brands that participated last year and will participate in Metaverse Fashion Week 2023, presenting their collections online, have made a significant choice that falls primarily on the fashion house’s own perception of innovation. The potential of events in the virtual world lies in the contact with younger consumers, Gen Z or the even more budding Gen Alpha, who are increasingly interested in buying digital goods. 

Secondly, participating in events in the Metaverse is a way for brands to experiment, test trends and give value to their products, which are protected by blockchain. 

However, as Sam Hamilton, creative director of the Decentraland Foundation and co-organiser of Metaverse Fashion Week 2023 reiterated: ‘fashion and high fashion are not new to the Metaverse. Decentraland has been at the forefront of digital fashion, in demand since the launch of wearables (tokens) in 2020. Since then, creators have been working on the technical and stylistic limits of these digital wearables and have created a booming economy’.

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