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Interoperability in the Blockchain — What Is It and How Does It Work?

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Interoperability In The Blockchain — What Is It And How Does It Work?
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We’ve all equated decentralization with the blockchain by now, which makes perfect sense as one of the main characteristics of blockchain technology is its decentralized nature.

However, with decentralization comes a lot of uncertainty. How can different blockchains connect? Can we find anything universal about them? It is clear that there are many dilemmas here, which is why blockchain interoperability has become a hot topic in the last few years.

This phenomenon is bound to have a profound impact on the crypto sphere and beyond and will undoubtedly lead to more innovation and growth. But what is it? How does it work? More importantly, what does it mean for you? Let’s find out!

Blockchain Interoperability Explained

Blockchain interoperability is a highly complex technology from a scientific point of view. However, what it does is simple — it allows different blockchains that operate independently to connect and communicate.

Thanks to interoperability, blockchains can share data, information, and more. In other words, regular users get to use different blockchains without worrying about compatibility issues.

For a better understanding, it’s best to consider emails. When you send an email to someone, you don’t have to worry about choosing the same provider the other person uses. They might have AOL, Outlook, Yahoo, or any other service, while you use Gmail or Zoho Mail. It doesn’t matter, as the email will reach the other address regardless of the provider. This interoperability of email technology is what made it so successful and widely adopted in the first place.

With blockchains, this isn’t true. Some blockchains are interoperable, and we have several pioneering this technology, like Polkadot, Cosmos, Cardano, and others. However, most aren’t, so you may not be able to use them all the time.

With blockchain interoperability, every blockchain would be able to interact and send data and messages to another.

Importance of Interoperability for Web3

As we all know, Web3 is on its way. We might not be able to predict how it’ll look, but various blockchains will certainly play a key role.

What’s more, decentralized finances will be one of the biggest parts of Web3, and it’s one of the main reasons why we’ll need to introduce true blockchain interoperability to make this a reality. People will want to manage their finances and make payments across the web and different blockchains without having to use different tokens and coins every time.

Furthermore, different blockchains have different functionalities, and a regular user will have to deal with many of them on a daily basis. This will need to be possible without worrying about interoperability. In essence, without interoperability, it would be as if we couldn’t use various websites and platforms on the web as easily and simultaneously as we do today.

So, if we want to have Web3, we’ll need a way of implementing the latest solutions on the new internet just as we do today. In other words, we’ll need blockchain interoperability.

Examples of Blockchain Interoperability Solutions

At the moment, we have many projects attempting to solve interoperability, each in its own way. Polkadot and Cardano are one of the most prominent blockchains on the web that are dealing with it.

Polkadot uses something called parachains. These work like individual Layer-1 blockchains and can function simultaneously on the Polkadot network. Each chain relies on the security of the main chain but still preserves its individuality.

On the other hand, Cardano focused on smart contracts from the start, which effectively led to interoperability.

Cardano and Polkadot aren’t the only projects trying to solve interoperability between blockchains. We also have a lot of other smaller initiatives that have gone further.

A good example is t3rn, a smart contract hosting platform that offers interoperable smart contract implementations with an added fail-safe mechanism that ensures the reversibility of transactions, another thing that’s currently not possible with most blockchains.

t3rn offers uniform standards for integrating transaction-based and smart contract-driven blockchains through unique gateways. In other words, multi-chain execution and interoperability are assured.

Bottom Line

Blockchain interoperability is a complex topic, and it certainly won’t be easy to implement one solution that will handle interoperability for the entire internet. However, it’s necessary and inevitable for Web3. It will be interesting to see how it is handled in the future, but we hope that you’re now aware of how important it is for the web of tomorrow.

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Investors Should Check These Data Before Buying HBAR

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Hedera shows lots of potential, despite some major hiccups lately. Investors will be better equipped if they examine some key data before acquiring HBAR.

Here’s a quick look at some important numbers:

  • HBAR currently trades at $0.05798
  • Trading volume currently at $36.2 million
  • Hedera circulating supply at 22.97%

Hedera is a new and revolutionary open-sourced crypto network that utilizes a distributed ledger technology that is designed to allow both developers and users to use DApps.

HBAR Up 2.05% As Of Press Time

HBAR’s development activity has seen tremendous growth in such a short span of time since November 2018. Notably, HBAR has ranked third, next to Polkadot (DOT) and Cardano (ADA).

Hedera is designed to solve the nagging problems in terms of scalability, which is a huge problem among blockchains.

Right now, Hedera is seen to be one of the winners in terms of scalability and security when pitted with other blockchains which is why it remains to be one of the most popular and widely used enterprise-grade blockchain in the world.

According to CoinMarketCap, HBAR, the 39th largest cryptocurrency, trades at $0.05798 or shows a spike of 2.05% as of press time.

With its current price, HBAR is noticeably 91% sidetracked from its all-time high.

Hedera Trading Volume Down 89%

On a year-to-date basis, HBAR has also evidently dropped by 408%. The downtrend of HBAR has started following its daily high that registered at $249.68 million seen on May 12.

The trading volume of HBAR is currently at $36.2 million, showing a decline of 89% since its ATH on May 12.

More so, the circulating supply of HBAR has also plunged together with the trading volume and price. The circulating supply is at 22.97 billion or at 46% since January.

The daily chart for HBAR shows the spike of buying pressure that is growing to date.

Meanwhile, it’s worth noting that HBAR liquidations only made up 0.00001% of the total market’s $52.04 million in liquidations during the past 24 hours.

Coinglass reports that the total value of all HBAR trades in the preceding 24 hours was pegged at $6,615.

HBAR market cap at $1.32 billion | Featured image from Freepik, Chart: TradingView.com

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BNB Chain Halts Operations Due To Potential Hack

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Bnb Chain Halts Operations Due To Potential Hack
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Binance’s signature Binance Smart Chain is the latest to suffer from an exploit, and the chain is “temporarily paused,” according to the official BNB Chain Twitter account and Binance’s CZ.

Early hours following the hack look to show 2M BNB, or over $500M at time of publishing, through the Binance Bridge. Furthermore, many have criticized the response around the matter. Let’s take a look at the details we know thus far.

Binance Bridge Can’t Avoid The ‘Bridge Problem’ 

One of the biggest issues around crypto vulnerabilities often seems to be bridges – where movement from one chain to another adds a layer of complexity that has proved to be a challenge. According to Paradigm researcher @samczsun (who provides a detailed thread on the the exploit), the BSC Token Hub bridge was tricked to send the attacker two transactions of 1M BNB each.

However, in early reports it seems that the tokens were not owned user tokens, but rather tokens not in existence before the exploit.

Binance's BNB token faced impacts from today's exploit. | Source: BNB-USD on TradingView.com

Criticism Around Halting The Chain

BSC reps went on to explain that they “coordinated with validators to temporarily suspend BSC,” which led to many critics emerging around the degree of centralization surrounding the chain. It seems that today’s hack is the second largest in history, and while Binance CEO Changpeng ‘CZ’ Zhao has assured holders that their funds are safe, there’s still a lot to discover here.

Featured image from Pixabay, Charts from TradingView.com
The writer of this content is not associated or affiliated with any of the parties mentioned in this article. This is not financial advice.
This op-ed represents the views of the author, and may not necessarily reflect the views of Bitcoinist. Bitcoinist is an advocate of creative and financial freedom alike.

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Cardano TVL Plummets To 8 Month Low, Not Seeing Effect Of Vasil

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Cardano has suffered a significant drop in its total staked volume since its March 2022 peak. The proof-of-stake blockchain has lost over 76% of its total value locked in the past eight months. The decline is alarming, given the decentralized crypto project’s recent Vasil hardfork. 

The Cardano community welcomed the Vasil upgrade with high expectations. The hardfork was meant to upgrade the blockchain’s performance and place it in a position to contend with other top DeFi projects. However, it seems that the update hasn’t been able to deliver much bullishness for ADA holders.

Related Reading: Why “Rosy” Earnings Estimates Might Hurt Bitcoin As Price Struggles At $20,000

Loss Of Staking Value For Cardano

Based on data obtained from Defi Llama, Cardano’s total value locked (TVL) has continuously decreased since its March height. It has now fallen below $80 million for the first time since January 2022.

More specifically, Cardano’s TVL was reported to be $76.66 million at the time of this writing. This figure reflects a 76.49% decrease from the all-time high of $326 million that it hit on March 24, 2022. This new figure has pushed the staking value of ADA to the levels it had in January 2022.

Cardano is presently ranked 27th among all blockchains regarding the total value of locked (TVL). It is trailing behind blockchains such as Bitcoin (BTC), Algorand (ALGO), Polygon (MATIC), Avalanche (AVAX), and Tron (TRX). Ethereum (ETH), which now has a market value of 32 billion dollars, has a commanding lead.

ADA’s price is currently trading at $0.4289. | ADAUSD price chart from TradingView.com

Can Cardano Reach $1?

ADA and most other cryptocurrencies suffered through a gloomy month in September. However, crucial updates and strong token fundamentals suggest that ADA might be set for a breakthrough in October. This is generally a bullish month for the cryptocurrency markets.

Nevertheless, it seems unlikely that Cardano will be able to reach $1 in the next four weeks. This is because major technical indicators like the RSI and MACD are below 50, signaling a negative trend.

Cardano Making Waves In Other Areas

Despite the fact that Cardano’s staking value has dropped significantly, there are some positive developments happening within the project’s space. For instance, Cardano is among the ten most popular cryptocurrencies picked by banks that disclosed exposure to the innovative asset class. The findings were reported by the Basel Committee on Banking Supervision (BCBS) of the Bank of International Settlements (BIS).

Not only that, but Cardano has also been winning in the social media area. The number of daily social mentions of ADA had risen to a 90-day high of 52,470 as of September 23. This brings the total number of mentions to 2.32 million, as per statistics from the social intelligence platform LunarCrush.

Related Reading: Calm Before The Storm? Bitcoin Volatility At Historically Low Levels

Finally, Cardano has the support of several bulls who have expressed their confidence in the project. The cryptocurrency community at CoinMarketCap is positive on the price of Cardano by the end of October. Based on a poll, members have predicted that ADA would trade at $0.5873 at the end of the month. This was 36.77% higher than its $0.4294 price at the time of writing.

Featured image from Pixabay and chart from TradingView.com

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Polygon (MATIC) Leads Gains By Adding Over 14% In A Week

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Polygon (MATIC), the Ethereum L2 project, has seen a massive increase in its price over the past seven days. The project has enjoyed much attention from the bulls, gaining over 14% in just one week.

Polygon, currently ranking 11th based on market cap, has had a busy week. The PolygonDAO has been closing deals and partnerships to expand the project’s reach. This might be a major determinant of its more than 14% increase.

Related Reading: Has Bitcoin Price Broken Out Of Downtrend Resistance? BTCUSD Analysis October 6, 2022

However, it’s uncertain if the token will breach its $0.85 resistance in the coming days. As of writing, MATIC is trading at $0.83, down 0.66% in the last 24 hours.

Doubts Despite 7-Day Gains

Despite recording a stunning 14% gain in value, there are still doubts surrounding the project’s next price direction. In the early hours of today, the coin strengthened itself against BTC and ETH. MATIC recorded 1.45% and 0.39% gains against both currencies, respectively. It also traded at $0.8462, a 0.70% gain over its last 24-hour price. 

The price of MATIC has moved over both the 9 and 20 Exponential Moving Average (EMA) lines. This is noticeable on the daily chart for the MATIC/USDT pair. Still, on the subject of EMAs, the 9 EMA has just made a bullish crossover above the 20 EMA. This crossover may signal a continuous upward trend for the token.

However, traders must be cautious as the Relative Strength Index (RSI) indicator shows that MATIC’s price has established a local top. The Relative Strength Index line seems to slope downward, indicating that prices have dropped to an oversold level. Another technical indicator is that the coin’s sale volume has recently surpassed the purchase volume. This suggests that the rise beyond the EMAs will be temporary, signaling bearish sentiments.

MATIC’s price is currently trading at $0.8336. | MATICUSD price chart from TradingView.com

Polygon’s Partnerships Sustaining Its Upward Trend

Polygon has announced several new partnerships in the past few weeks that have helped push its value higher. One of the most notable is its exclusive partnership with RobinHood, a top crypto broker. The partnership saw Polygon become the first blockchain supported in the broker’s newly launched web3 wallet.

Upon launch, 10,000 iOS users were given access to the wallet’s beta version. This number was just 10% of the total number of users who signed up for the waitlist back in May. Robinhood’s main aim for choosing Polygon is to give its users the best possible trading experience. The company cited the technology’s scalability, speed, and cheap network costs as the primary reasons for its decision.

Related Reading: Wash Trading Dominates Bitcoin Volume, What Does This Mean For Price?

Additionally, Polygon recently announced on Twitter that they’d hired Halborn Security to carry out a security audit for them. Halborn Security is a prestigious security firm that undertakes ethical hacking audits for blockchain companies across the globe. The Halborn team will have eight weeks to complete the task. They’ll also work with two seasoned full-time security engineers who are well-versed in advanced smart contract hacking, penetration testing, and blockchain protocols.

Featured image from Pixabay and chart from TradingView.com

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Wash Trading Dominates Bitcoin Volume, What Does This Mean For Price?

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The daily bitcoin trading volumes come out into billions of dollars every day, with hundreds of thousands of daily transactions being carried out. It is one of the reasons why bitcoin draws the most investors, given such high trading volume and good depth across all exchanges. However, some on-chain analyzers have been diving into the blockchain to explore the daily BTC volume, and the findings of this study have been alarming.

More Than 50% Fake Volume

Mostly, in the present market, there is always some amount of volume for digital assets that are actually fake. These fake trading volumes are to make a digital asset look better than they actually do to make other investors put money into them. Smaller-cap altcoins are usually guilty of this to a large extent, but it seems the largest cryptocurrency by market cap is not left out of this. 

Bankless Times carried out a study into the daily bitcoin volume for the year 2022 and found that the majority of the volume was actually fake. The study showed that 51% of bitcoin volume across various exchanges was actually a result of wash trading.

BTC maintains above $20,200 | Source: BTCUSD on TradingView.com

For those who do not know, the act of wash trading an asset is illegal because it creates a false narrative about that asset to make investors put their money into it. This way, they are trapped, and the wash traders walk off with millions of dollars in profit, depending on how large the scheme is.

The study unveiled that stablecoins were actually contributing largely to this wash trading volume. This means that the digital asset is seeing up to $10-$15 billion in fake volume across exchanges, giving rise to concerns about how this affects the cryptocurrency.

Impact On Bitcoin Price

To the unsuspecting eye, there might be no manipulation going on when it comes to the price of bitcoin, but this report from Bankless Times actually shows that the digital asset is being largely manipulated. Wash trading can easily affect the price of a digital asset by making it look like a profitable investment. 

So say bitcoin is being wash traded across multiple exchanges; it deceives investors to believe that there is a large demand for the asset, leading them to purchase it. Thereby raising the digital asset of the cryptocurrency in the process.

With such a large volume of trading volume reportedly being fake, it begs the question of if the current BTC price is actually accurate. A real volume of less than 50% of reported volumes would put the digital asset’s value at around $12,000, if true.

Featured image from Forbes, chart from TradingView.com

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Floki Inu Eyes Break Out At $0.00000800, But The Price Must Do This First

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Floki Inu Eyes Break Out At $0.00000800, But The Price Must Do This First
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  • FLOKI price continues to struggle as price ranges in a downtrend channel with a major breakout imminent. 
  • FLOKI trades below key resistance as price ranges under 8 and 20-day EMA.
  • The price of FLOKI struggles to flip key resistance into support. 

Floki Inu (FLOKI), one of the most popular memecoins in crypto, is expected to upset Shiba Inu, which won the hearts of many after a brief surge but may be set to repeat this move. All indicators and patterns indicate that the price of Floki Inu (FLOKI) is overdue for a rally to the $0.000015 region, and even higher if bulls are willing to push this price to a new high despite the current market downtrend. Floki Inu (FLOKI) has received a negative response, with prices trending in a downtrend channel while other altcoins and the crypto market look to bounce from key support areas. (Data from Gate.io)

Floki Inu (FLOKI) Price Analysis On The Weekly Chart.

Despite struggling to break above $0.000015 in recent weeks, the price was rejected and has remained range-bound as it prepares to trend higher to the $0.00002 region. FLOKI’s price found weekly support at $0.0000060 after falling by more than 70% in the previous few months due to the current market not allowing FLOKI to trend.

There is no doubt that the price of FLOKI will surge when the market recovers from its current bearish state. FLOKI maintains range with little or no volume in order to break free from this structure.

FLOKI’s price recently rallied to a region of $0.000015 after retesting a weekly low of $0.00000600 but was rejected in an attempt to break higher for the price to trend. FLOKI has been trading in a range for some time now and could be poised for a significant rally.

Weekly resistance for the price of FLOKI – $0.000015.

Weekly support for the price of FLOKI – $0.00000600.

Price Analysis Of FLOKI On The Daily (1D) Chart

Daily FLOKI Price Chart | Source: FLOKIUSDT On Tradingview.com

On the daily timeframe, the price of FLOKI continues to struggle as the price aims to rally to a high of $0.00002 after a successful breakout from a downtrend channel that its price formed. 

FLOKI is currently trading at $0.0000077, just below the 8-day and 20-day Exponential Moving Averages (EMA). On the daily timeframe, the price at $0.00000773 corresponds to the price at the 8 and 20-day EMA for FLOKI.

FLOKI’s price must reclaim the $0.000008 region with high volume in order for the price of FLOKI to rise to the $0.00002 region. According to the current market structure, price action, and indicators, FLOKI will soon break out of the daily downtrend channel, with a possible rally to $0.00002.

Daily resistance for the FLOKI price – $0.00002.

Daily support for the FLOKI price – $0.000007.

Featured Image From Zipmex, Charts From Tradingview

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