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Blockchain tech will bridge the gap between DApps and enterprises

A cross-chain data oracle can be used to seamlessly create custom oracle scripts for traditional enterprises to connect them to blockchain-based applications.

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Blockchain technology is revolutionizing the way we interact, transact and share information, with many experts predicting it will be the most disruptive technology in the next decade. After little structural innovation since the 19th and 20th centuries, decentralization has brought industries such as finance, media and technology closer to transparency, freedom from intermediaries and heightened efficiency.

Traditional enterprises rely on a centralized closed-door structure. In contrast, decentralized finance projects are being built with the ethos that governance should be decentralized and democratic. Transitioning society to decentralized platforms can make many services safer, more accessible and more transparent than ever before. The increasing interest in the space speaks to a collective desire to have more control over critical elements of our lives, especially our finances.

While decentralization helps to solve issues like transparency and efficiency, the lack of a trusted central authority means that decentralized applications, or DApps, must rely on third parties to supply data to execute transactions or application functionalities such as taking out a loan. Access to reliable, trusted information such as price feeds, real-world events and identification, among many others, underpins the reliability, strength and efficiency of a decentralized application.

The security to protect this data comes from an oracle solution that is able to reliably and effectively connect real-world and off-chain information with decentralized applications and smart contracts in a verifiable, manipulation-resistant manner. With more than 1 million regular users of DApps globally, there is a huge demand for reliable data external to the blockchain because it underpins the security of DeFi applications and the billions currently locked in the space.

Following hacks, attacks and data manipulation, the challenge facing blockchain technology is creating trust and building secure systems in the absence of established enterprises or government regulations. This is where new technologies like data oracles are essential to create a secure link between traditional companies with reliable price feeds and the decentralized ecosystem.

Connecting the old and the new

Data oracles act as the bridge between decentralized blockchain applications by aggregating and connecting real-world data to smart contracts. These decentralized applications then use smart contracts that self-execute when certain criteria are met, such as liquidating collateral, which requires a price oracle. In the absence of a centralized authority, data oracles are essential to connect blockchain-based applications with the information required to execute these smart contracts.

The use cases for smart contracts and oracle technology are extensive and span across insurance, real estate, healthcare and, most importantly, the DeFi space, where a security breach could put millions at stake.

In DeFi, instances of hacks are plentiful. Data oracles are the input to the logics of smart contracts and therefore dictate their behavior: the output. If the data oracle input is incorrect, this leads to unintended behavior from the smart contract and can result in losses of funds or other undesired outcomes, as seen even in the strongest DeFi projects. These structural problems make widespread adoption of data oracles essential.

There is a desperate, critical need to connect Web 2.0 to Web 3.0, to create a more resilient, efficient, censorship-resistant internet. Traditional companies built on Web 2.0 are not yet structurally ready to make the transition into DeFi due to the learning curve, know-how and organizational flexibility required. These traditional enterprises will require seamless onboarding processes with a high level of flexibility and customizability to act as a bridge to Web 3.0.

This is where novel oracle technology will come in, providing the support and systems for enterprises to make the leap into Web 3.0 without the businesses themselves having to grapple with the process.

While DeFi has undeniably boomed over the past year, the space still requires broader adoption by the majority, who have no coding expertise, as it is this accessibility that will create a truly robust DeFi ecosystem.

Traditional enterprises also stand to benefit greatly from this transition, as their data is a valuable resource to decentralized applications and an innovative new revenue stream ripe for market capture as the industry continues rising.

Why we must incentivize traditional enterprises to the blockchain

Many decentralized applications require real-time information such as price feeds, sporting results, weather and news updates to function. Traditional enterprises that can supply reliable real-world data must take advantage of this growing demand by connecting with decentralized applications and commercializing this data through a reliable data oracle. Tech and media giants like Google and Bloomberg, for example, would benefit hugely from the use of a data oracle.

This is an exciting step for the industry, as when large enterprises dip their toes into DeFi, it adds extra security and legitimacy to the space. In turn, this transition will create an additional source of income for these established businesses in a new, thriving industry. Traditional enterprises have no choice but to enter the space or risk being left behind as the world continues to adopt DeFi, DApps and smart contracts.

Connecting directly with data sources is the best way for companies to ensure the security and integrity of their data — which simultaneously strengthens the overall security in the DeFi space and the entire decentralized ecosystem. Oracles play a very important role in this process and in building trust in the DeFi and wider blockchain industry.

The future is decentralized

We are already seeing many large enterprises incorporating decentralized technologies into their business models. It is up to the leaders in the DeFi space to engage and guide these traditional businesses for there to be significant change and evolution. It is imperative that the industry prioritizes usability, simplification and community education to experience the widespread adoption DeFi is gunning for. The future is decentralized, and there is so much room for the industry to grow — we are only at the beginning of the revolution.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Kevin Lu is the head of business development and growth at Band Protocol, a Sequoia-backed cross-chain data oracle platform. Previously, he was the creator and writer of Protocol Weekly/DeFi Weekly, a newsletter to showcase the progress of different Ethereum layer-two protocols and decentralized financial projects.

Source: https://cointelegraph.com/news/blockchain-tech-will-bridge-the-gap-between-dapps-and-enterprises

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Cointelegraph

VanEck and BetaShares apply for Aussie crypto ETFs as family offices snap up BTC

VanEck and BetaShares have lodged submissions with the ASX for Bitcoin and crypto-related funds.

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Numerous institutional crypto product applications have been lodged as Australians buy more Bitcoin.

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VanEck and BetaShares apply for Aussie crypto ETFs as family offices snap up BTC

Family offices in Australia are reportedly piling into digital assets as fund managers compete to list the country’s first cryptocurrency-backed exchange-traded fund.

VanEck and BetaShares have each lodged submissions with the Australian Securities Exchange (ASX) following a rejection of industry speculation in March that the exchange was opposed to such products. The ASX confirmed that had received formal applications from several other investment managers eager to launch their own Bitcoin ETFs.

Earlier this week VanEck Asia-Pacific chief executive Arian Neiron stated that the crypto asset movement had become more mainstream and thaa Bitcoin ETF on the ASX could democratize crypto assets for all types of investors.

Australian ETF provider BetaShares also confirmed an ASX application but did not specify whether it was planning a Bitcoin product or one more broadly backed by digital assets.

Managing director Alex Vynokur stated that there was significant demand for such products, adding:

“From our perspective, a regulated structure of an ETF is the more appropriate structure for a significant number of investors, rather [than] buying Bitcoin or other cryptocurrencies on unregulated exchanges.”

The ASX declined to speculate or comment on the applications but stated that it is closely monitoring developments in relation to listed investments involving Bitcoin and other cryptocurrencies.

The moves have been viewed as bullish by investors down under as Australia’s wealthiest families begin to diversify their portfolios with crypto assets.

According to a Business Insider Australia report, listed blockchain investment company DigitalX has been offering assistance to increasing numbers of family offices eager to invest in the maturing digital asset space. Executive director Leigh Travers said that investors are replacing their gold portions of portfolios with Bitcoin, adding:

“The biggest change has been around institutional interest which has helped evolve it from a speculative asset to an asset that is part of a diversified portfolio and has the strongest macro winds of any investment possible I think,”

Travers cited DeFi as being one factor that has made this bull run different from the previous one in 2017/18.

The report revealed that the average family office in Australia and New Zealand controls more than $600 million each and the moves into crypto assets signal just how ubiquitous the asset class is becoming.

As reported by Cointelegraph, Australia’s securities regulator (ASIC) wants crypto firms to engage with them to help them foster innovation in the region.

In late April, the U.S. SEC delayed the decision on VanEck’s Bitcoin ETF until June 17.

Source: https://cointelegraph.com/news/vaneck-and-betashares-apply-for-aussie-crypto-etfs-as-family-offices-snap-up-btc

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Ethereum co-founder Vitalik Buterin becomes billionaire as Ether hits $3K

Ethereum co-founder Vitalik Buterin officially becomes a crypto billionaire following Ether’s meteoric rise above $3,000.

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Vitalik Buterin’s crypto holdings have doubled since January 2021 to surge above $1 billion.

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Ethereum co-founder Vitalik Buterin becomes billionaire as Ether hits $3K

Vitalik Buterin, a co-founder of the world’s most popular smart contract platform, the Ethereum blockchain, has officially become a crypto billionaire.

Buterin’s public Ether address, which he described as his main wallet back in 2018, has hit $1 billion on its balance following Ether’s meteoric rise above a $3,000 price mark on Monday.

At the time of writing, the address holds around 333,500 Ether (ETH) now worth $1.029 billion, according to on-chain data from Etherscan, as ETH more than quadrupled in value from around $700 at the beginning of 2021.

At publishing time, the world’s largest altcoin is trading at $3,144, up 8.6% over the past 24 hours, with gains of 36% over the past seven days, according to data from CoinGecko.

Ethereum price chart over the past 180 days. Source: CoinGecko

According to some online crypto players, 27-year-old Buterin now could be the youngest self-made billionaire in the cryptocurrency industry.

Vitalik Buterin is the youngest crypto billionaire #ETH #Ethereum #Crypto pic.twitter.com/7PfyPvbiC9

— JUSTIN (@justintrimble) May 2, 2021

Amid surging prices, Buterin has been generous with his crypto holdings. In late April, the Russian-Canadian programmer donated 100 Ether and 100 Maker (MKR) tokens to a COVID-19 relief fund for India.

According to some online crypto players, 27-year-old Buterin now could be the youngest self-made billionaire in the cryptocurrency industry.

Source: https://cointelegraph.com/news/ethereum-co-founder-vitalik-buterin-becomes-billionaire-as-ether-hits-3k

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2 key Ethereum price metrics prove pro traders are behind ETH’s new highs

Ethereum futures data suggests that pro traders believe $3,500 ETH is the next stop for the top altcoin.

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Ethereum futures data suggests that pro traders believe $3,500 ETH is the next stop for the top altcoin.

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2 key Ethereum price metrics prove pro traders are behind ETH’s new highs

As Ether (ETH) made a $2,800 all-time on April 29, so did its futures open interest. The $8.5 billion figure marks a 52% monthly increase and shows robust trading activity behind the meteoric price rise.

Some analysts might dismiss Ether derivatives, considering CME’s future has $355 million in open interest compared to Bitcoin’s $2.4 billion. However, Ether contracts were only launched a couple of months ago. Both FTX and Deribit require 100% full-KYC for their clients, and these markets hold a combined $2 billion in ETH open interest.

Ether futures aggregate open interest, USD. Source: Bybt

To this in perspective, the open interest on silver futures currently stands at $22.6 billion. The precious metal has decades of trading history and a $1.4 trillion market capitalization. However, a simple analysis of the number of outstanding contracts isn’t really helpful as these can be used for hedging.

Growth in futures is positive but not a guaranteed bullish indicator

To assess whether the market is leaning bullish, there are a couple of derivatives metrics to review. The first one is the futures premium (also known as basis), which measures the price gap between futures contract prices and the regular spot market.

The 3-month futures should usually trade with a 10% to 20% annualized premium, which should be interpreted as a lending rate.

24-hour average OKEx 3-months ETH futures basis. Source: Skew

As the above chart depicts, ETH’s futures premium went berserk in mid-April, peaking at 45% annualized. Although traders’ FOMO played a role, this also signaled extreme optimism. While professional traders most frequently use monthly futures contracts, perpetual contracts are the go-to instrument of retail investors.

Retail investors are flat at the moment

Perpetual contracts are also known as inverse swaps, and these contracts have a funding rate usually charged every 8 hours. This fee increases as longs (buyers) use higher leverage, so their accounts get drained little by little. When a retail buying frenzy occurs, the fee can reach up to 5.5% per week.

Ether perpetual futures 8-hour funding rate. Source: Coinalyze.net

As the above chart displays, the 8-hour funding rate recently peaked at 0.18% on April 14, equivalent to 3.8% per week. While this certainly contributed to the highly optimistic monthly futures’ basis, the impact has completely faded as the funding rate has been negligent over the past couple of days.

This data suggests that, compared to retail investors, professional traders are more bullish on Ether as the 3-month basis currently stands at 25% per year. This rate is higher than most stablecoin lending services offer, meaning longs (buyers) are willing to pay a premium to keep their positions open.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Source: https://cointelegraph.com/news/2-key-ethereum-price-metrics-prove-pro-traders-are-behind-eth-s-new-highs

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