Category Archives: Ethereum
Staking can modernize the Ethereum ETF – Blockworks
Before diving into the crux of this op-ed, lets be clear: The vision outlined here recognizes the pragmatic approach ETF issuers are currently taking.
Initial Ethereum ETFs will be plain vanilla in structure and simply track the spot price of Ethereum as a first iteration. That said, just as the equity ETF market has evolved to offer a plethora of sophisticated products beyond simple price tracking offerings, so too must the Ethereum ETF space.
With that understanding, a particular vision emerges one where, just as an investor in an equity ETF demands a pro-rata dividend, an Ethereum investor assertively seeks out staking rewards. To omit such rewards is akin to denying oneself a full, comprehensive return on investment.
Staking is Ethereums beating heart. It is the mechanism that rewards any ETH holder for bonding their holdings to validators, who then propose and attest to new blocks on the Ethereum blockchain, and in return are rewarded with newly minted Ethereum as well as a portion of the transaction fees in the block.
To put it plainly, staking is the modern-day operating system for Ethereum. And therefore staking must play a role in an ideal Ethereum ETF.
As an example, a fund with a balance of 9,600 ETH (approx. $15 million) could earn an additional 32 ETH on a monthly basis by staking. This not only enhances the funds revenue, but also contributes to Ethereums network security. Staking ensures validators are actively participating and making the network more resilient against potential attacks.
Incorporating staking rewards also gives investors a fuller experience of Ethereum ownership. These rewards can potentially provide enhanced returns over time when compared to solely tracking Ethereums price performance, as has historically been the case.
Staking rewards can offer a unique avenue for fund managers. They can be innovative in compensating investors, either by directly distributing the rewards pro-rata to investors like a dividend, or by reducing management fees and adding staking rewards to the funds total allocation, thus increasing the net asset value (NAV) for each investor. This creates a win-win scenario for both the fund and the investor.
Since the Merge in 2022, Ethereums supply has been on a decline. A portion of the transaction fees paid by Ethereum users is burned, the amount of which is usually higher than the new supply issuance. This deflationary nature makes ETH scarcer by the day, increasing its inherent value.
An ETF that stakes and captures new issuance might, in essence, be capturing an increasingly valuable asset.
A staking-centric approach reinforces Ethereums network. As more ETH is staked and more validators join the network, the cost to attack Ethereum rises exponentially, fostering a more secure environment for transactions and smart contracts.
Staking is not without its challenges. The dynamic unbonding period of Ethereum means that once staked, the assets arent immediately liquid. To address this, an Ethereum ETF could strategically stake only 50% of its holdings.
Furthermore, by incorporating a liquid staking protocol which adheres to KYC/AML norms, the ETF could allocate another 30% ensuring the requirements of institutional investors are met without compromising liquidity.
Read more from our opinion section: DeFi has a reputation problem
Liquid staking is a mechanism where users stake their crypto assets in this case, ETH and receive a token representing their staked amount in return. These tokens can then be traded, sold or used in other decentralized finance (DeFi) protocols, essentially making them a liquid counterpart to an otherwise locked asset.
Its essential that institutional investors look for protocols who fulfill KYC/AML requirements. The remaining 20% could be maintained in spot ETH, offering additional immediate liquidity.
As Ethereum ETFs gain momentum, their success will hinge on delivering returns while addressing liquidity concerns.
An intelligent combination of staking platforms and liquid staking protocols can be the bridge between these two worlds, ensuring Ethereum investors get the complete value they deserve, analogous to the dividends stock investors have come to expect. This vision paves the way for an Ethereum ETF that truly resonates with the modern investors needs.
For informational and advertising purposes only. The views and opinions expressed are those of the authors but not necessarily those of MarketVector Indexes GmbH or Figment. The information herein is being provided to you for general informational purposes only. It is not intended to be, nor should it be relied upon as legal, business, or investment advice. MarketVector Indexes GmbH and Figment undertakes no obligation to update the information herein.
Josh Deems is Institutional Business Development Lead at Figment, leading efforts to bridge the gap between traditional finance and proof-of-stake services. With over eight years of experience in the traditional finance meets digital assets industry, Josh has played a pivotal role in shaping the landscape of digital asset adoption. As a founding employee at Fidelity Digital Assets, the industrys largest initiative from a traditional institution, he successfully secured billions of dollars in assets under custody. Josh also contributed his insights at State Street, where he was a key member of the Emerging Technology Center, driving innovation through research on early blockchain protocols and digital asset services. As part of the investment team at Stillmark Ventures, Josh showcased his acumen in raising capital and conducting in-depth analyses of startups in the Bitcoin ecosystem, supporting their growth and success. Josh holds a Bachelor of Business Administration (BBA) from George Washington University and is based in Boston, MA.
Martin Leinweber works as the Digital Asset Product Strategist at MarketVector Indexes (MarketVector) providing thought leadership in an emerging asset class. His role encompasses product development, research, and communication with the client base of MarketVector. Before joining MarketVector, he worked as a Portfolio Manager for equities, fixed-income, and alternative investments. Martin was responsible for the management of active funds for institutional investors such as insurance companies, pension funds, and sovereign wealth funds at the leading German quantitative asset manager Quoniam. Previously, he held various positions at one of Germanys largest asset managers, MEAG, the asset manager of Munich Re and ERGO. Among other things, he contributed his expertise and international experience to the establishment of a joint venture with the largest Chinese insurance company PICC in Shanghai and Beijing. Martin is co-author of Asset-Allokation mit Kryptoassets. Das Handbuch (Wiley Finance, 2021). Its the first handbook about integrating digital assets into traditional portfolios. He has a Master of Economics from the University of Hohenheim and is a CFA Charter holder.
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Ethereum Staking Demand Drops Sharply, Validator Wait Time … – Unchained
Only 223 validators are in the queue to stake Ethereum a significant decline from the 96,600 in line a few months ago.
Photo by Shubham Dhage on Unsplash
Posted October 13, 2023 at 3:13 am EST.
Blockchain data shows that the Ethereum validator queue has shrunk by a large amount over the last few months, potentially signalling a decline in staking demand.
In June, there were around 96,600 validators in the queue to stake ETH on the Proof-of-Stake blockchain. Currently, there are only 223 validators in the entry queue a far cry from the peak earlier this year.
The average wait time for a validator to join the network is also down to just 1 hour and 50 minutes, compared to the 45 days validators had to wait in line in June.
Some market participants have noted that the declining waiting times might be a sign of declining demand for staking. Interestingly, the demand for ETH staking was amplified when the Shanghai upgrade went live in April, with institutional investors depositing three times the amount deposited in the previous month.
The Shanghai upgrade enabled the ability for validators to withdraw their staked ETH after more than two years. Although, it is worth noting that at the time of the upgrade, the majority of ETH staked was underwater.
Still, while the demand for staking ETH now appears to have weaned off, the number of active validators has been on the rise. Data shows that there are currently 857,000 active validators on the network, with around 22% of the cryptocurrencys supply staked.
The counterintuitive numbers might be caused by the increased popularity of liquid staking platforms like Lido and Rocket Pool, which together have $15 billion in Total Value Locked (TVL).
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Ethereum Staking Demand Drops Sharply, Validator Wait Time ... - Unchained
Ethereum Could Explode by Over 2,100%, According to $820,000,000,000 Global Bank: Report – The Daily Hodl
One of the largest banks in the world reportedly believes that the smart contract platform Ethereum (ETH) could soar by more than 2,100%.
According to a new CNBC article, the UK-based bank Standard Chartered is predicting that Ethereum will eventually increase to as high as $35,000 after hitting $8,000 in about three years.
Geoff Kendrick, an analyst at the London-based bank, says that increasing use cases and layer-2 scaling solutions built on Ethereum are among the reasons for the price forecast.
We think Ethereums established dominance in smart contract platforms, along with emerging uses in gaming and tokenization, has the potential to push ETH to the $8,000 level by end-2026 [which is] a stepping stone to our long-term structural valuation estimate of $26,000-$35,000.
According to CNBC, Kendrick believes gaming and tokenization of real-world assets offer some of the greatest growth potential for Ethereum.
He also expresses optimism about planned Ethereum upgrades. In early 2024, Ethereum is slated to implement proto-danksharding, which would increase the networks transaction speed and lower transaction costs.
Layer 2 scaling solutions are likely to grow in importance over time, particularly as architecture upgrades expected in early 2024 sharply lower fees on these platforms. This should help to cement ETHs dominance in the smart contract space, thereby increasing its P/E (price to earnings) ratio over the next couple of years.
With ETH trading for $1,540 at time of writing, an increase to $35,000 would represent a 2,173% jump, while a move to $8,000 would be a 419% increase.
Standard Chartered is the 43rd largest bank in the world with $820 billion of assets under management.
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Whales Abruptly Move $749,000,000 in Bitcoin, Ethereum, XRP and Shiba Inu Heres Where the Crypto Is Heading – The Daily Hodl
New data reveals deep-pocketed crypto investors are suddenly shifting hundreds of millions of dollars worth of digital assets, including Bitcoin (BTC) and Ethereum (ETH).
According to data from whale-tracking platform Whale Alert, $511 million worth of the top crypto asset by market cap just moved to the top US-based digital asset exchange Coinbase or an unknown wallet.
The transactions involving the crypto king on Whale Alerts radar include:
Moving on to altcoins, Whale Alerts data shows that high net worth investors have moved about $238 million worth of the leading smart contract platform Ethereum, meme asset Shiba Inu (SHIB), and XRP, the crypto asset used to operate Ripple Labs payments platform, to crypto exchange platforms.
The altcoin movements identified by Whale Alert include:
Featured Image: Shutterstock/Tithi Luadthong
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ProShares is set to Launch Inverse Ethereum Futures ETF – Crypto Times
ETF provider ProShares is poised to further expand its crypto offerings with an inverse Ethereum futures fund.
The planned ProShares Short Ether Strategy ETF (SETH) aims to gain exposure to potential declines in the Ethereum price.
ProShares filed details of the new fund on Friday, just weeks after debuting three long-only Ether Futures ETFs in early October. SETH would trade on NYSE Arca and track the inverse daily performance of the S&P CME Ether Futures Index.
The fund would allow investors to benefit from downward moves in Ethereum without directly shorting the asset.
According to ProShares, they expect the SEC to approve the registration statement on October 15th, with a launch target in early November.
SETH would join the providers Bitcoin inverse futures ETF, the Short Bitcoin Strategy fund launched in June 2022.
Currently, it has attracted around $75 million in assets so far. ProShares long-term Bitcoin futures ETF (BITO) remains the largest, with $850 million in assets under management.
The pending introduction of an inverse Ether product comes as Ethereum hovers near $1,500, down 6% in the past week. The cryptocurrency had rallied earlier in October on optimism over the SECs approval of futures-based ETFs.
On August 4, ProShares and Bitwise filed an application with the SEC for exchange-traded funds with a focus on bitcoin and ether. After which, ProShares moved quickly with VanEck and Bitwise to offer the first three Ether funds immediately after SEC greenlighting on October 2nd.
The products open crypto exposure to a broader investor base via the ETF structures convenience.
But the debut of an inverse fund also allows for capitalizing on potential volatility declines or bearish sentiment. ProShares has established itself as a leader in crafting diverse crypto investment vehicles for various market conditions.
The SEC took over two years to approve Ether Futures ETFs after the historic first Bitcoin fund. How fast the assets can grow remains uncertain amid the crypto market flux. However, tailored options continue to broaden access for investors with differing risk appetites.
Read also: ProShares is Launching the first U.S Short Bitcoin-Linked ETF
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ProShares is set to Launch Inverse Ethereum Futures ETF - Crypto Times
Mastercard Tests CBDCs on Ethereum in Australia Pilot – Crypto Briefing
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Mastercard Tests CBDCs on Ethereum in Australia Pilot - Crypto Briefing
Heres When Ethereum Competitor Cardano May Witness Long-Awaited Breakout, According to Crypto Trader – The Daily Hodl
A popular crypto analyst says Ethereum (ETH) challenger Cardano (ADA) may be approaching a long-awaited breakout moment.
Ali Martinez tells his 31,100 followers on the social media platform X that ADA could move above the upper bound of an enduring consolidation range as early as December.
Cardanos current consolidation trend eerily mirrors the 2018-2020 phase! If history repeats, ADA could stay in this consolidation phase until July 2024.
Barring unforeseen events like the COVID-19 crash, ADA could break out as soon as December!
Looking at his chart, the trader is looking for ADA to cross the $0.50 mark. If that happens before the end of the year, he believes it would likely surpass the $6 level by the end of 2024.
ADA is trading for $0.24 at time of writing.
The trader is also weighing in on Bitcoin (BTC). He says the crypto king needs to convincingly close above $28,233 to ignite a bull cycle. He bases the prediction on the Warm Supply Realized Price indicator, which comprises the less active component of the short-term holder supply, right through to the start of the long-term holder cohort.
Bitcoin Warm Supply Realized Price indicator suggests that the bull run will only reignite if BTC secures a sustained close above $28,233!
Martinez is watching the Relative Strength Index (RSI), a momentum indicator that aims to determine if an asset is overbought or oversold.
Bitcoin: In the past month, the four-hour chart RSI has been the real MVP for spotting those local highs and lows!
The strategy is simple: buy BTC when RSI dips below 30.35. Sell BTC when RSI exceeds 74.21.
Notice the RSI recently dropped below 30.35, signaling a potential buy-the-dip opportunity!
Next up, the trader says that the Tom DeMark (TD) Sequential indicator, which traces a series of price points to signal possible trend reversals, is suggesting Ethereum could soon bounce.
Ethereum is moving within a steady range. Interestingly, the TD Sequential presented a buy signal at the lower end of this range, suggesting ETH could rebound to $1,630.
But be cautious: if ETH closes below $1,530, the bullish outlook will be invalidated.
Ethereum is trading for $1,536 at time of writing.
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Bitcoin, Ethereum worth $1.8 million stolen in a phishing incident on a fake search website – FXStreet
Phishing has become a tempestuous topic in the cryptocurrency industry, with numerous reports of attacks on different ecosystems. Seemingly, the issues prevalence has gotten so severe that users are now searching for phishing links online, possibly to crosscheck related stories.
Also Read:Ethereum price: Frog Nation ex-CFO 0xSifu longs ETH with a position size of more than $20 million
Bitcoin (BTC) and Ethereum (ETH) the two leading cryptocurrencies on metrics of market capitalization were involved in a phishing incident on October 13, after a holder searched for a fake imToken url on a fake website.
The fake imtoken website swindled Bitcoin and Ether worth $1.8 million from the users address (3Hnx...8CZN), sending 63 BTC tokens worth approximately $1.69 million to another address (34uE...PjNm), likely their own, Arkham Intelligence, a powerful tool for deanonymizing the blockchain shows the transaction history.
Arkham Intelligence
With phishing attacks becoming increasingly sophisticated, it is imperative that users remain vigilant when URLs are concerned. This is especially when financial transactions or sensitive information is concerned. Using trusted sources is critical with a double emphasis on never clicking on suspicious links.
Barely done with the first half of October and almost five ecosystems have fallen victim to exploits. After the attack on Balancer V2 pools in August and a subsequent exploit on the same networks frontend on September 20, revelations that many crypto enterprises are vulnerable to subdomain/domain hijacking made headlines, citing Doman Name System (DNS) attacks. Galxe, a web3 community platform was also attacked on October 6.
As of October 10, up to 11 Binance accounts had lost almost $450,000 to scammers within a two-week span following phishingattacks, according to Hong Kong police reports, which urged investors to trade using licensed cryptocurrency exchange platforms in the region for better protection.
Before this report, FXStreet also reported an attack on the Beluga Protocol, with the decentralized exchange, which operates as a multichain stableswap to facilitatecross-chain swaps, losing almost 110 ETH, worth almost $170,000.
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Crypto Venture Firm Placeholder Capital Says Ethereum and Solana Are Like Android and iOS Heres Why – The Daily Hodl
A prominent crypto venture capital firm is comparing Ethereum (ETH) to the mobile operating system Android and Solana (SOL) to iOS.
In a new blog post, Placeholder Capital makes a case for why Ethereum and Solana are comparable to the two different operating systems.
Ethereum and Solana are like Android and iOS. Android values modularity: it runs on many different types of devices made by hundreds of manufacturers worldwide; Google only makes 1-2% of them. This approach made it the worlds most popular mobile operating system, with an estimated 60-75% market share.
Androids flexibility has been a boon for hardware companies making anything from smartphones to televisions, as they can bring new products to market without investing billions into building bespoke operating systems. However, such diversity also makes it more difficult to develop apps that seamlessly work across many devices with different specs, screen sizes, and the various versions of Android these devices run.
The venture capital firm says that iOS has significant qualities that Android lacks, including a more consistent user experience.
By contrast, because Apple makes all iOS devices, it can provide users and developers with a more integrated and consistent experience. The time saved by not having to optimize across different devices can go into delivering better apps that users are willing to pay a premium for, and its not uncommon for companies to launch on iOS first as a result.
So, while Apple has just about a third of the market in terms of distribution, it does a much better job at capturing the value of its ecosystem with a whopping ~60% of all mobile spend, plus all the hardware revenue.
According to Placeholder Capital, Ethereums likeness to Android is helping to boost its layer-2 ecosystem.
Ethereum is similar to Android in that its quickly becoming more of a platform for third-party networks than the place where most end-users and developers operate.
Solana offers developers certain benefits over Ethereum, including speed and cost, according to the firm.
Solana is similar to iOS in how it values tightly integrated components in the name of throughput and performance. Theres much more to it different consensus mechanisms and design principles but ultimately, Solana as a single, unified network is much faster and cheaper than Ethereum and many other EVM (Ethereum Virtual Machine) networks.
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This Ethereum-based dApp noted a 100% increase in TVL in a month, eclipsing Lido DAO, AAVE and more – FXStreet
Ethereum, being the home of Decentralized Finance (DeFi), hosts a bunch of protocols on the network. However, given the tense market conditions, very rarely does a protocol manage to grow as quickly as Silo Finance did over the past month.
Ethereum-based Silo Finance, a lending market protocol that has also been deployed on Arbitrum, has noted an increase of 94% in the total value locked on the platform. On-chain insights platform Nansen noted that the reason behind this rise is the fact that they enabled crvUSD to be the universally accepted collateral across all their markets.
Consequently, the protocol gained the investors attention, which translated to the TVL of the application rising from $70 million at the end of September to $143 million at the time of writing.
Silo Finance TVL
To put this growth into perspective, in the same duration, some of the topmost DeFi protocols, such as MakerDAO, Curve Finance, and Convex Finance, among others, have lost the total value locked on them. This decline ranges from around 16% to 23% in the span of four weeks.
Along with the total value locked on the platform, the trading price of the native token of Silo Finance also grew in the last month and a half. Trading at $0.048 at the time of writing, SILO could see hovering around $0.025 towards the end of September. Since then, the altcoin has shot up by 92%.
Given Silo was trading around $0.029 at the beginning of the year, the overall growth in the altcoins price year to date happens to be above 90%, akin to the increase in the last 45 days.
SILOs trading price is still 56% below the peak of the altcoins performance this year. According to CoinMarketCap, the cryptocurrency hit a high of $0.1096 towards the end of April and has been on a downward trend since then until the end of September.
SILO trading price
From here on, Silo price might see some correction as the overheated market would need to cool down.
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