Weekly Editors' Picks Weekly Editors' Picks (1112-1118)
"Weekly Editor's Picks" is a "functional" column of Odaily. On the basis of covering a large amount of real-time information every week, a lot of high-quality in-depth analysis content will also be released, but they may be hidden in the information flow and hot news, and pass you by.
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Now, come and read with us:
Investment and Entrepreneurship
Investment and Entrepreneurship
4D looks back at the 10-year investment and financing evolution history of the encryption industry
The FIFA World Cup is about to start, where are the opportunities for Fan Token?
$POR and $ARG, as national team fan tokens, will be very popular during the World Cup. The $PSG team has France's Mbappe, Argentina's Messi and Brazil's Neymar, all of whom are big stars; $JUV has France's Pogba; $ATM has France's Griezmann. There are star players participating in these teams, which will attract more attention. Subsequent investment in Fan Token needs to keep abreast of the development of the project party and the club, such as the launch of new products to reward Fan Token holders, and the mechanism of token burning, which will be regarded as positive factors. The basic information of the club/team/star should also be paid attention to.
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a16z: How to avoid financial risks like FTX from happening again?
We need to regulate Web3 applications, not protocols. Protocols are simply software, and Web3 applications run by centralized, for-profit businesses can comply with regulatory requirements in various jurisdictions and should be regulated accordingly. The risks of CeFi and DeFi are different, and trying to regulate software will only lead to further offshoring of Web3 developers.a16z in "Enabling Cryptographic Privacy and Regulatory Compliance Using Zero-Knowledge Proofs
" further elaborated on the path of using zk technology to assist supervision.
What is the significance and loopholes of the Merkle Tree reserve proof?
There are still many loopholes in the current asset verification scheme. In terms of many details, it is still difficult for the exchange to "prove its innocence". The transparency of centralized institutions has always been an issue that has been widely concerned and discussed. Insufficient transparency will cause investors’ concerns, but too transparent may expose commercial secrets to a certain extent, and these contradictions do not only occur in the Web3 field.
Web3 Pit Avoidance Guide: A List of Top Ten C-side Security Tools
Thousand-character long text: How to ensure the security of your encrypted assets in the time of CEX crisis?
DeFi
iZUMi Research: The status quo of DEX and the future of decentralized exchanges
The report analyzes the data on the Taker side and Maker side of the largest pool WETH-USDC 0.05% on the head DEX - Uniswap V3, and uses this as a representative to check the overall status of the current DEX track under different market conditions. Under the violent market fluctuations, the trading volume and active real users on Uniswap v3 have declined, but liquidity providers are still active, and DEX maintains good liquidity. And due to factors such as JIT liquidity (short-term liquidity that supports large-order transactions), the overall transaction liquidity is actually better.
But in terms of overall user experience, Uniswap V3 still has too much room for improvement, such as MEV attacks, slippage, uncertain transaction execution results, etc., as well as user experiences such as not supporting limit orders, wallet management complexity, and handling fees question.
Taking Uniswap as an example, discuss the long-term impact of MEV on AMM
Income – Looking at the scale of income extracted by bots, arbitrage bots extracted at least $85 million from market price asymmetries involving Uniswap V3 liquidity pools. Sandwich Bots took at least $47 million from swap users in the form of slippage losses. JIT bots pulled $6M from Uniswap V3 swap fee revenue. Total revenue from bots accounts for 25% of LP revenue. However, there is no apparent conflict of interest between Arbitrage Bot, Sandwich Bot, and LP.
Frequency – Arbitrage bots are more likely to find trade opportunities than other bots.
Profitability - MEV robots make average profits most days and have a few lucky days where they make a lot of money.
Cost – The average transaction cost for bots has been trending down in recent months.
Pools - Over 80% of Sandwich Robot's profits come from the top 10 pools by volume. However, only 20% of sandwich activity takes place in these pools.
Participants - unique exchange users who can benefit from JIT activities seem to be increasing.
Trading Patterns - Looking at the structure of arbitrage transactions, spatial arbitrage involving one Uniswap V3 pool and another venue is the most common pattern.
NFT, GameFi and Metaverse
FTX crisis spreads, BendDAO liquidation storm strikes again?
When the market liquidity is scarce, the already illiquid NFT and the NFT derivative agreement will face severe tests. The author first introduced the liquidation mechanism of BendDAO, reviewed the run on BendDAO in August, noticed that 28 BAYCs on BendDAO had entered the liquidation auction, and explained how BendDAO could further improve the mechanism.
Must-read for NFTfi followers: A comprehensive analysis of the "danger" and "opportunity" of NFT lending leader BendDAO
Franklin, the seventh largest holder of BAYC, "manipulated" the floor price to trigger the BendDAO auction liquidation. The article focuses on the FUD and the truth behind this "smashing arbitrage" incident and Yuga Labs. The table of contents is as follows:
Web 3.0
Stages of Crypto Wallet Development
Profit model of encrypted wallet
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wallet product
This article takes stock of 11 Web3 unissued currency social graph projects
The article briefly introduces ULAS, CyberConnect, Lens Protocol, Atem Network, Relation, Light, Mem Protocol, pip, Context, 5Degrees, RSS3 in turn.
Ethereum and scaling
DAOrayaki: How Account Abstraction Can Ensure Ethereum Mass Adoption
Account abstraction is the process of simplifying the two accounts of Ethereum (externally owned account EOA and contract account CA) into a single type - contract account. The resulting contract account will be able to initiate transactions, pay transaction fees, and can be customized to a user's unique needs. The contract account will have the functions of traditional EOA and CA.
Methods for implementing account abstraction include Lazy Full Abstraction, removal of random number abstraction, and standardized signature schemes.
Abstract Research Report on Ethereum Accounts: Dismantling 10 related EIP proposals and the bottleneck problem affecting tens of millions of daily active users
In Splurge, the sixth phase of Ethereum’s latest roadmap, the newly incorporated ERC-4337 has become the main implementation of account abstraction.
New ecology and cross-chain
Innovations and Opportunities in the Move Language
Since Libra's vision is to become the financial infrastructure of a global currency, Move must put asset security at the forefront of its design goals.
In order to better realize asset security, Move has made innovative changes in language design, virtual machine and verification tools: Move defines a new Resource type for digital assets, and abstracts two basic attributes that resources should meet. Scarcity and access rights; through the module system of strong data abstraction, the authority control of accounts is realized; the transfer of asset ownership is realized by inheriting Rust's Ownership system. In addition, the introduction of mechanisms such as static calls, formal verification, and bytecode verifiers also jointly provide multiple guarantees for the security of digital assets.
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hot spots of the week
hot spots of the weekIn the past week, the FTX incident continued to ferment, with constant aftershocks (Topic), many exchanges have announced cold wallet addresses and reserve certificates one after another,，USDT once had a negative premium of more than 1%，SBF resigns as FTX CEO，FTX officially declares bankruptcy and reorganization，Court documents show Alameda's assets and liabilities exceed $10 billion，A large number of assets of FTX and FTX US are collected into the same addressAbout $380 million in FTX funds were transferred, suspected to be an insider absconding with money,，FTX CTO is still submitting codes until the 11thFTX Confirms Some Assets Were Illegally Transferred, is working with law enforcement on the issue,，The encapsulation token soBTC issued by FTX/Alameda is no longer redeemableUS investors formally initiate class action against SBF, the new CEO of FTX said，FTX Completely Lacks Reliable Financial InformationFinancial mess includes use of software to cover up misuse of funds, company funds being used to buy homes for employees, and more, FTX restructuring advisor，About $740 million worth of cryptocurrency found in FTX offline cold wallets，Alameda Research Receives Secret Exemption From FTX's Liquidation Proceedings，Bankruptcy documents show that Alameda and its affiliates have liabilities of approximately US$5.1 billion and total assets of US$13.46 billionCalifornia suspends BlockFi lending license for 30 days, is investigating BlockFi and FTX, WSJ says，Genesis said that the FTX crash led to a liquidity crisis, and Sanjian Capital’s default had a negative impact, affected by the bankruptcy of FTX,, affected by the bankruptcy of FTX,，BitCokeCrypto lending platform Salt has stopped deposits and withdrawals，Suspension of withdrawals, saying private key holders are under judicial restraint，The person in charge of finance is under further investigation by the police, and other shareholders are negotiating overseas capital acquisitions, saying that "it takes 7-10 days to proofread and restore user assets";
In addition, in terms of policies and macro markets,In addition, in terms of policies and macro markets,Treasury Secretary Yellen: FTX's debacle shows need for careful regulation of cryptocurrencies,U.S. House of Representatives Financial Services CommitteeHearing on FTX debacle to be held in December, Reuters:Bahamas Financial Crime Bureau
Has officially intervened in the investigation of the FTX incident;In terms of opinions and voices, Bloomberg:Big investors may be giving up on mainstreaming crypto markets, CZ talks about giving up the acquisition of FTX:，In addition to financial aspects, user overlap and regulatory intervention are also reasons，The fall of FTX will bring about a chain reaction, and more companies may go bankrupt in the next few weeks，Will comment more on competitors in the future to reduce industry riskBinance will set up an industry recovery fund to help high-quality projects survive the liquidity crisis, publishedSix principles of centralized exchanges, including avoiding excessive leverage,Short agency Citron: continue to short ETH
, believe that it has the same common sense flaws as FTX;NFT and GameFi fields,Portal
With "Editor's Picks of the Week" seriesPortal。
See you next time~
