Mars Finance Crypto Daily December 28, 2023
1. Today’s news
BNB's market value rebounded and overtook SOL, returning to fourth place in the cryptocurrency market value rankings
According to Coingecko data, BNB’s total market value (approximately $51.28 billion) surpassed SOL (approximately $45.19 billion) and returned to fourth place in the cryptocurrency market value rankings.
The Numbers: Blast TVL tops $1.1 billion
According to DeBank data, the total value of assets held by the Layer 2 network Blast contract address launched by Blur founder Pacman exceeds US$1.13 billion, of which US$1.03 billion worth of ETH is deposited in the Lido protocol, and more than 100 million DAI is deposited in the Maker protocol.
5 whale addresses participating in Bounce IDO have sold 42.04 million AMMX
According to on-chain analyst @ai_9684xtpa, the 15 whale addresses that participated in Bounce's latest IDO received a total of 122 million AMMX, and the sales are as follows:
-5 addresses have sold all AMMX, totaling 42.04 million, equivalent to approximately US$390,000; -5 addresses have not yet transferred/sold the funds after receiving them;
- Open a position again after all the sales are completed at 1 address;
-1 address sold 90% of its holdings;
-1 address has not sold and continues to increase its position;
-2 addresses have not been claimed yet.
According to previous news, 15 whales received a total of 122 million AMMX, accounting for 25.8% of the total issuance of the AUCTION staking pool (not including two unclaimed addresses); these whales invested a total of 709,000 AUCTION in participating in the new issuance, and currently 9 addresses have recharged a total of 394,000 tokens into Binance.
Report: AI, Web3 games and MEME are the top three crypto narratives this year
CoinGecko Research data shows that in 2023, AI, Web3 games and MEME will occupy the top three places in crypto narratives respectively, Solana ecosystem, BRC20, RWA and public chains will rank fourth to seventh, and DeFi, Ethereum ecosystem, NFT, etc. will rank relatively low.
PancakeSwap launches a proposal to reduce the maximum supply of CAKE from 750 million to 450 million
PancakeSwap has proposed to reduce the maximum supply of CAKE tokens from 750 million to 450 million to better fit the current circulating supply. The voting proposal will take place within 24 hours, with a deadline of 16:00 on December 29, and if approved, will take effect on January 4, 2024.
Perpetual contract platform Levana suffered an attack, with losses exceeding $1.1 million
According to The Block, the Cosmos ecosystem perpetual trading platform Levana Protocol suffered a hacker attack, resulting in a loss of more than $1.1 million. The post-mortem report provided by its team showed that between December 13 and December 26, the attacker successfully extracted 10% of the Levana liquidity pool. Levana said it was working to fix the problem, and existing trading positions and profits were not affected. In the future, it plans to compensate the affected liquidity providers through airdrops and the distribution of protocol fees collected during the attack.
Data: Arbitrum, Celestia and Blur’s first airdrops together account for 69.9% of this year’s total crypto airdrops
CoinGecko statistics show that the first airdrops of Arbitrum, Celestia and Blur together account for 69.9% of the total cryptocurrency airdrops distributed in 2023, or $4.56 billion worth of tokens.
Hong Kong Monetary Authority Consultation Document: Unlicensed issuance and promotion of stablecoins in Hong Kong are criminal offenses
According to the Hong Kong Monetary Authority's consultation paper on stablecoins, issuing stablecoins in Hong Kong without a license and issuing advertisements to promote stablecoins of non-licensed issuers are both criminal offenses.
For those institutions that obtain licenses and become qualified to issue stablecoins, the document also recommends that the regulatory system should introduce a series of civil and regulatory sanctions. The HKMA may consider imposing appropriate penalties depending on the severity and duration of the violations, including temporary or permanent suspension or revocation of licenses, a fine of not more than HK$10 million, or a fine of three times the amount of profit gained or loss avoided due to the violation, whichever is higher.
For licensed institutions, if the issuer violates the relevant proposed legal provisions or operates improperly, the document proposes to empower the HKMA to force all personnel of the institution suspected of violation to provide evidence, including any records or documents, and to apply to the magistrate for a search warrant and conduct seizure if necessary.
The MAS proposed that issuers must have sufficient financial resources, with a minimum share capital requirement of HK$25 million. When an institution defaults or goes bankrupt, which may have a potential impact on the financial system, the MAS may intervene in the operations of the licensee when necessary and require that the affairs, business and property of the licensee be managed by an administrator appointed by the MAS.
Beosin: In 2023, the total loss of Web3 due to hacker attacks, phishing scams and project party Rug Pull will reach 2.02 billion US dollars
According to the EagleEye platform under the blockchain security audit company Beosin, as of December 25, the total losses in the Web3 field due to hacker attacks, phishing scams and project party Rug Pulls in 2023 reached US$2.02 billion. Among them, there were 191 attacks with a total loss of approximately US$1.397 billion; 267 project party Rug Pull incidents with a total loss of approximately US$388 million; and the total loss of phishing scams was approximately US$238 million.
In 2023, hacker attacks, phishing scams and project party Rug Pull incidents have all dropped significantly compared with 2022, with the total amount falling by 53.9%. Among them, hacker attacks have dropped the most, from US$3.6 billion in 2022 to US$1.397 billion in 2023, a decrease of approximately 61.2%. Phishing scam losses dropped by 33.2% compared to 2022, and rug pull losses dropped by 8.8% compared to 2022.
In 2023, there were 4 attacks with losses exceeding 100 million US dollars, and 17 attacks with losses between 10 million and 100 million US dollars. The total loss of the top 10 security incidents was about 1 billion US dollars, accounting for 71.5% of the total amount of annual attacks.
The types of projects attacked in 2023 are more extensive than those in 2022, including DeFi, CEX, DEX, public chains, cross-chain bridges, wallets, payment platforms, gambling platforms, crypto brokers, infrastructure, password managers, development tools, MEV robots, TG robots, etc. DeFi is the project type with the highest attack frequency and loss amount, with 130 DeFi attacks causing a total loss of approximately US$408 million.
In 2023, the types of public chains attacked became more frequent, with multiple security incidents of theft on multiple chains. Ethereum is still the public chain with the highest loss, with 71 attacks on Ethereum causing a loss of US$766 million, accounting for 54.9% of the total loss for the year.
In terms of attack methods, 30 private key leaks caused a total loss of approximately US$627 million, accounting for 44.9% of the total loss, which is the attack method that caused the most losses. Contract vulnerability exploitation is the most frequent attack method. Among the 191 attack incidents, 99 were from contract vulnerability exploitation, accounting for 51.8%.
About $295 million of stolen funds were recovered throughout the year, accounting for about 21.1%, a significant increase from 2022. About $330 million of stolen funds were transferred to mixers throughout the year, accounting for 23.6% of the total stolen funds.
Different from the significant decrease in on-chain hacking attacks, phishing scams, and project Rug Pull amounts, criminal data in the off-chain encryption field will increase significantly in 2023. In 2023, the amount of crime in the global encryption industry reached a staggering US$65.688 billion, an increase of approximately 377% from US$13.76 billion in 2022. The top three types of crimes involving amounts of money are online gambling, money laundering and fraud.
Vitalik: I am very happy to see Arbitrum achieve the first stage of Rollup. I hope more projects will follow next year.
Ethereum co-founder Vitalik said in a Warpcast post: “I am very happy to see that one Rollup has entered the first stage this year (and several projects are very close to the first stage). This is a real progress in decentralization. I hope to see ten Rollups enter the first stage next year and achieve a certain degree of sequencer decentralization.”
From the screenshot posted by Vitalik, we can see that the Rollup he referred to as entering the first stage is Arbitrum.
According to the definition of Rollup phase development proposed by Vitalik in the Ethereum Magicians forum and summarized by L2beat, compared with the zero phase, the first phase of Rollup must meet five conditions:
1. A complete and fully functional proof system is deployed;
2. At least 5 external participants can submit fraud proofs;
3. Users can exit without the help of an authorized operator;
4. If an actor more centralized than the Security Council implements an unnecessary upgrade, users will have at least 7 days to exit;
5. The Security Council is well established.
Vitalik Buterin proposes three ways to make Ethereum’s proof-of-stake design simpler
Ethereum co-founder Vitalik Buterin has proposed three solutions to what he describes as the underlying systemic complexity at the heart of ethereum’s proof-of-stake consensus mechanism. The first solution focuses on decentralized staking pools. This would involve setting the minimum amount of ether required to run a validator higher, forcing those who run validators to join together and pool resources. The second would be to use two tiers of stakers, one with more demanding requirements and another with lighter requirements. The two tiers would be used differently in the way the block finalization process is used. The third approach would be to have a rotating set of participants, meaning a random set of validators would be chosen for each slot. This would share the burden of work and reduce the total number of signatures, but as Buterin points out, it would increase complexity.
Pantera Capital Liquid Token Fund has accumulated nearly 80% growth in 2023, and is more optimistic about altcoins in 2024
As of mid-December, Pantera Capital's Liquid Token Fund has risen nearly 80% this year after falling 80% in 2022, according to Bloomberg, citing people familiar with the matter. Pantera Capital's Liquid Token Fund hopes to use altcoins (tokens other than Bitcoin and Ethereum) to achieve growth next year. Pantera portfolio manager Cosmo Jiang said in an interview that after Bitcoin's rise, altcoins have historically outperformed the market in the second stage of the market rebound, and it is actually important to choose what tokens. Its limited partners are looking to us to unlock assets other than Bitcoin. And Pantera's core argument is that if you believe that this industry will develop, you must focus on protocols that can actually generate revenue. Currently, one of Pantera Capital's largest positions is dYdX, and Bitcoin and Ethereum together account for less than 40% of the fund.
EIP-7212 becomes the first Rollup improvement proposal, aiming to improve the security and economics of L2
Researcher @doganeth_en posted on the X platform that the EIP-7212 proposal proposed six months ago has become the first Rollup Improvement Proposal (RIP) and will be implemented on multiple blockchains. The original intention of the proposal was to achieve secure, cost-effective verification of the secp256r1 (P256) curve.
The decision to use this proposal for Rollups was due to its significant impact on account abstraction in L2, as well as the large number of pass-key and SE-based AA wallets that already exist on L2. The introduction of new Rollup improvement standards enables researchers to propose improvements specifically for Layer 2 and sidechains, ensuring compatibility across various Rollup frameworks. In addition, EIP-7212 becomes the first RIP to be merged into the main repository, and RIP will exist as a proposal format other than EIP and ERC.
2. Selected articles
Vitalik: Three ways to simplify Ethereum's POS mechanism
Ethereum attempts to achieve decentralization, but there are problems with technical sacrifices and unrealized goals. This article proposes three solutions to obtain the maximum return, the largest validator will have 262,144 ETH, and the attack cost is about 9 million ETH. The advantage of this method is that the identifiable form retains the separate pledge, and the load can be increased through hard forks in the future.
Review of the year of the crypto unicorn with 170 million users: What has changed and what hasn’t changed in Binance
2023 is a year of change for Binance. The new CEO Richard Teng said that Binance will be committed to creating excellent products, ensuring the security of user assets and user experience, and promoting the growth and adoption of Web3. Binance Labs successfully assisted in cracking a large-scale pig-killing fraud case. Binance is accelerating the popularization of encrypted payment products to more non-circle users, launching reserve proof, emergency insurance fund SAFU, Launchpool project, Binance Academy, Binance Pay, Binance Card and Web3 wallet to help users seamlessly enter the Web3 world.
A complete analysis of the Crypto industry in 2023: topics that investment and research institutions are keenly interested in
The crypto industry is recovering from the cold winter in 2023, and the market value has doubled. AI+Crypto decentralized blockchain can reduce costs, and the total locked value (TVL) of Bitcoin DeFi may rise. The DePIN sub-track includes decentralized storage, decentralized database, decentralized wireless network and decentralized AI machine. Coinbase Research found that modular blockchain is attracting attention from the crypto community. DeSci can achieve fair credit distribution, simplify transactions, allow global resource sharing and overcome economic barriers.
The Block: Review of the Web3 social track in 2023
This year, decentralized social media applications have made positive progress, and the open social finance platform FriendTech has seen a significant increase in attention, providing a space where users can purchase keys that give them access to closed group chats with influencers. Since its launch in August, 843,000 users have spent a total of $267 million in ether in 120 million transactions. Blockchain can reward users around the world without the platform exploiting user data or running ads, and the core concept of social networks compensating users for content they post does have value.
3. Project Interpretation
Ethereum’s “revenge succeeded”, what opportunities can be ambushed in the ETH ecosystem?
Today, Ethereum broke through $2,400, with a 24-hour increase of 8.47%, while Solana's price fell from $123 to $104, a drop of 15%. The reason for the "resurrection" of the Ethereum ecosystem is obvious, and the return of funds to the Solana ecosystem is another factor that cannot be ignored. Vitalik posted on Warpcast that he hopes to see ten Rollups enter the first phase next year. The MetisDAO Foundation announced the creation of a fund of approximately $100 million to accelerate the growth of its ecosystem. The prices of native tokens such as HUM and VMUM have all increased to varying degrees. Ryan Sean Adams, founder of Bankless, pointed out that Ethereum has not yet entered the bull market, but its fundamentals are strong.
Exploring the next 100-fold Alpha of the Stacks ecosystem
The Stacks public chain was founded by Muneeb Ali and Ryan Shea in 2013. It has completed five rounds of financing with a total amount of US$88 million. It will launch the "Nakamoto" version in the first quarter of 2024, and the transaction speed will be increased from 10-30 minutes to 5 seconds. The STXS inscription project has become popular, and the price of the coin has increased from US$1 to US$1.5, an increase of 50%. Hiro Wallet is a desktop wallet application that supports Chrome, Firefox, Brave browser extensions and MacOS, Windows, and Linux systems. It can connect applications, purchase STX, mint and purchase NFTs, etc. If the "Nakamoto" version can be successfully launched, Stacks is likely to usher in an explosion under the BTC Layer2 narrative.
Metis is gaining popularity. Which projects will benefit from the 4.6 million ecological incentive fund?
MetisDAO announced the establishment of the Metis Ecosystem Development Fund (EDF), with 4.6 million METIS funds, to promote project deployment, product development, and builder rewards, enhance the value of Metis tokens, and attract a new wave of capital. The EDF narrative may mean that people’s attention will be focused on Metis. Netswap and Tethys Finance are among its main beneficiaries. Revenant is developing a decentralized gaming ecosystem driven by $GAMEFI.
