Many of the most popular decentralized finance protocols are getting a front-end makeover, but will the new looks and sleeker interfaces bring widespread adoption?
Critics have long held that the barrier to entry for DeFi is significant, both for the amount of knowledge required to participate as well as for oftentimes clunky interfaces. However, a spate of projects including Sushiswap, Curve, Yearn.finance, BadgerDAO and Synthetix have recently rolled out or are planning new front-end releases, one which may make interacting with the protocols easier.
The new looks are occasionally coinciding with significant technical developments. Synthetix’s successful layer-two launch led to a sundowning of the popular Mintr app in favor of a new “Staking” front end, and Yearn’s once-simplistic user interface was overhauled with some distinct stylistic touches that coincided with the launch of v2 vaults.
Yearn also commissioned a slick promotional video to celebrate the launch:
According to 0xMaki, a core contributor at Sushiswap, the promotional and UI efforts are a sign of healthy growth.
“I think it doesn’t matter at the beginning but the more your project becomes serious and you want to mature,” he said. “It should be the focus #1 because users who aren’t power users are never going to join our ecosystem otherwise.”
0xMaki said that Sushiswap is beginning to focus on marketing in tandem with development, with a 2021 roadmap that includes an effort on original content from a dedicated design team, as well as user education initiatives.
“We just hired 4 new core devs and are about to add for the first time contributors in the comms/ops/design in a fulltime manner,” he said. “It will exciting to see how they can perform when given this type of responsibilities.”
But Brian Flynn of RabbitHole, a DeFi participation incentivization platform, isn’t convinced a new lick of paint on the front end will be enough to generate a significant uptick in new users.
“Many would say having a great UI/UX would help adoption, but the reality is that anyone can create an interface for underlying smart contracts in DeFi,” he said. “Solving scalability is more important for the adoption of DeFi rather than having good design.”
Moreover, he implied marketing may not create real, “sticky” users who routinely leverage a protocol over an extended period of time.
“Marketing materials are generally low cost to produce and can generate a ton of hype & engagement. I’m not sure if that’s a good or bad thing, just an observation.”
0xMaki agrees that the rise in users from new UIs will ultimately pale in comparison to more important events, such as integrations with traditional finance rails. But until scalability and integrations come more clearly into the picture, he recommends a balanced, tempered approach to user experience and marketing:
“It is fun, not over done (no need to post daily, yo), good marketing is meaningful and educative. This is just how I see it bringing hype + visuals from time to time :)”
A new proposal has been announced for a cross-chain development on Cosmos, a high-speed, interoperable blockchain.
Connecting Cosmos and Ethereum
Althea Network, a decentralized mesh Internet network for rural communities, announced its “Gravity Bridge” product in a blog post this week. The product aims to connect the Ethereum and Cosmos blockchains to each other (technically called a “bridge”) for the Cosmos Hub.
“Backed by billions of dollars of Atoms staked, the Gravity Bridge is the most secure, efficient, and decentralized cross-chain bridge to ETH,” the firm said.
Cross-chain bridges are an integral part of the broader crypto and blockchain ecosystem. These are a step ahead of the one-size-fits-all narrative of earlier blockchains, which brought about problems of scalability, speed, and muted growth.
In simple terms, cross-chain products allow blockchains to “speak” and transfer value to each other and swap assets to each other. Cosmos has been built with these limitations and benefits in mind: It is a decentralized network of independent parallel blockchains, each powered by BFT consensus algorithms like Tendermint consensus.
And the Gravity Bridge helps port it to Ethereum. As per the official announcement, it is an evolution of the Peggy bridge, which itself has been developed in collaboration with the Interchain Foundation.
Benefits of Gravity
As Gravity is installed on the Cosmos Hub, the latter’s validators will directly participate in the operation of the Gravity bridge. That itself is backed by billions of dollars of staked ATOM, making Gravity the most secure bridge to Ethereum in production (after launch).
Gravity is also engineered to be very efficient. The Ethereum contract is highly optimized to use as little gas as possible, and transactions are batched. This allows for cheap and frictionless transactions from Ethereum to Cosmos.
Interoperability is the next feature. “Gravity will be able to bring ERC20 assets from Ethereum into Cosmos, but it will also be able to bring Cosmos assets to Ethereum,” said the blog, adding:
“$ATOM and every other asset in the Cosmos ecosystem will trade on Uniswap and other Ethereum AMMs, bringing a huge amount of liquidity and value to these assets.”
Meanwhile, Althea said it had already tested Gravity on two testnets, and that it would host an incentivized testnet in late Q1 2021. “There will be prizes available for validators, relayers, and hackers,” it said.
The newly sold artwork is part of Roiland’s crypto art collection called “The Best I Could Do.” The collection includes multiple artworks inspired by the Rick and Morty series as well as other animations including the iconic American animated sitcom, The Simpsons.
Dubbed “The Smintons,” Roiland’s crypto artwork is expected to be sold later today as the auction ends at 7 pm EST. At the time of writing, the highest bid amounts to $188,137.
The latest news comes shortly after Nifty Gateway announced the auction of Roiland’s collection on Jan. 13. The Rick and Morty co-creator is apparently an early Bitcoin (BTC) adopter as he publicly endorsed the crypto back in 2015.
Owned by Winklevoss’ crypto exchange Gemini, Nifty Gateway is a major NFT marketplace that facilitates a number of NFT sales each day. In December 2020, a Star Wars-themed NFT piece sold for $777,777 on the platform. Previously, Nifty auctioned Trevor Jones’ NFT “Picasso’s Bull” for $55,555.
Crypto NFTs have been steadily gaining momentum in recent months, bringing famous creators and artists a new opportunity to sell their pieces directly to their fans. In late 2020, Sean Ono Lennon, a British-American musician, songwriter and producer, auctioned a tokenized digital artwork on nonfungible-token marketplace Rarible.
Perpetual Protocol, a DeFi project offering decentralized perpetual contracts using the layer-two Ethereum scaling solution xDai, has emerged as the sixth-largest DEX by weekly trade volume after operating for only one month.
Based on data from Dune Analytics shared by Perpetual Protocol, the DEX’s weekly trade volume of more than $299 million would rank the project above the likes of Synthetix, dYdX, and Kyber, and below Balancer.
The milestone was shared in a blog post celebrating the project’s first month of operation — a period in which the DEX drove more than $500 million in total volume and generated more than $500,000 in trading fees.
All trading fees generated by the protocol are currently sent to an insurance fund designed to secure the protocol, with the project planning to divert 50% of fees to PERP stakers once its staking pool has launched.
In the blog post, Perpetual Protocol noted that it spent only $183 to execute 179,000 transactions as gas fees on xDai are just one-one-hundredth of those on the Ethereum mainnet. With Perpetual Protocol covering the gas fees of its traders, the DEX would have had to pay out $18,300 in fees if it was operating directly on Ethereum.
Congratulations to the @perpprotocol, just over one month old and already making some serious moves with trading volume surpasing 500M! Running on @xdaichain, gas for more than 179K transactions was only $183! https://t.co/RiqoUY4xit
XDai is one of several L2 scaling solutions that are offering an alternative to the heavy fees associated with operating directly on the Ethereum mainnet, with Synthetix recently launching the first stage in its transition to optimistic roll-ups.
Looking ahead, Perpetual expects to introduce limit order functionality during the first quarter of 2021, and will also launch staking in February.
Decentralized exchanges emerged as a cornerstone of the crypto ecosystem during DeFi’s Q3 2020 boom, with leading DEX Uniswap now processing almost $1 billion in volume each day and regularly surpassing many major centralized exchanges by trade activity.
Despite the booming volume, the DEX sector is currently dominated by a handful of platforms — with roughly half of the combined DEX trade activity taking place on Uniswap, and 90% of combined volume transpiring on the four largest platforms.
Leading decentralized exchange, or DEX, platform Uniswap continues to lead the sector as it nears an average of $1 billion a day trading volume for the month of January.
Only two-thirds of the way into the month and the platform has already surpassed the previous monthly trade volume record of $15.3 billion set in September during the DeFi boom. The DEX passed $17 billion as of this morning and is on track to surpass $25 billion by the end of January with a daily average of $855 million.
Uniswap traders are spoilt for choice with 1,558 coins traded in more than 2,400 pairs, however the majority tend to favor less risky trades. Trading between stablecoins, such as USDC, Tether and DAI, against ETH, made up 45% of the $1.1 billion traded in the last 24 hours.
On December 15, Uniswap founder Hayden Adams tweeted that the platform had passed $50 billion in all-time trade volume and asked the community when it would hit $1 trillion. Approximately 50% of respondents tipped this would occur in 2021.
Currently sitting around $70 billion in all time trade volume, the DEX would need to average approximately $2.7 billion each day in order to hit $1 trillion by the end of the year.
Uniswap strategy Lead Matteo Leibowitz is already claiming $1 billion trading volume is here to stay:
“$1bn volume/day is the new normal.”
Adams compared this to the New York Stock Exchange, saying “2% of [NYSE] is the new normal for Uniswap. When 100%?”
Uniswap is a legitimate business with $1 billion in daily volume, generating $30 million in daily revenue.
All with next to $0 in operating costs, created with nothing but lines of code.
DEX’s in general have been on a strong growth trajectory over the last 30 days, increasing by 112%. The total volume traded in the last 30 days is $43.3 billion with approximately $1.5B added each day.
SushiSwap is the next strongest DEX with $8.2 billion traded in January to date, already double its previous monthly high of $3 billion, set in December last year.
With Ethereum inching its way into new all-time highs over the past 24 hours, a number of onlookers believe Ether could quickly surge through the $1,400 price range.
Ethereum’s robust fundamentals are strengthening the conviction that Ether might sail past resistance in the mid-$1,400s, with many pointing to Ethereum’s ever-growing DeFi ecosystem as the force most-likely to propel ETH into price discovery.
On Jan. 19, Spencer Noon of crypto VC fund Variant shared 11 indicators he believes suggests that a parabolic bull-run is nigh. He pointed to the fact taht more than one million unique addresses t have interacted with DeFi over the past eight months.
Noon adds that monthly DEX volume is currently sitting at an all-time high of more than $30 billion, while more than $20 billion has been deposited into DeFi lending protocols — of which more than $4.5 billion has been issued as currently outstanding loans.
Looking beyond DeFi, Noon also highlights that Ethereum is the top blockchain network by daily fees generated — beating out BTC by more than 50%; the number of daily active Ether addresses has doubled in the past 12 months to reach all-time highs of 550,000; and that nearly $20 billion worth of stablecoins were minted on Ethereum over the past year.
The thread notes that more than $25 billion is currently locked in DeFi, adding that 21 decentralized finance protocols now represent at least $100 million in total value locked each.
#1: Ethereum continues to dwarf the entire crypto space in terms of fees paid ($7.25m daily avg) — proving it’s the most useful network in the world. pic.twitter.com/t7Co50GukJ
Despite Ethereum’s surging fundamentals, Noon notes that the number of Ether transactions valued at more than $100,000 is seven times smaller than during Jan. 2018’s highs, suggesting that “institutions still haven’t entered the game.”
On the same day, Token Terminal, an analytics platform that uses traditional financial metrics like P/E to examine crypto markets, tweeted a chart of Ethereum’s “price to sales ratio” with the caption “this time is different.”
The chart shows that Ethereum’s price relative to the fees generated by the network is reaching all-time lows — suggesting the market may be extremely undervalued. However, replies on Twitter challengede the applicability of using the metric to Ethereum, noting that Ethereum’s “sales” comprise fees that are collected by miners.
Messari also shared data indicating that the daily volume of Ethereum transactions now exceeds that of Bitcoin by 28%.
On Jan. 10, leading pro-EOS YouTuber Colin Talks Crypto announced he had sold all his holdings following the revelation earlier that day that Dan Larimer had resigned his position as CTO of Block.one, the company that made the software powering the EOS blockchain.
EOS, as of this writing, is the 16th-largest blockchain by market capitalization, according to CoinGecko, right after the privacy coin Monero and right above decentralized finance (DeFi) protocol Aave. Its market capitalization took a major hit following the Larimer news, losing about a billion dollars in a day.
Hopes for EOS have in many ways hinged on the actions of Block.one, the company that successfully completed a yearlong initial coin offering (ICO) that raised a record-setting $4 billion. These days, however, Block.one is more explicitly about driving value to its stash of 140,000 BTC (and counting) than its considerable EOS position.
To be fair, Block.one never really promised to do more than provide the underlying software for EOS, and it has continued to do so.
In fact, as EOS has become clogged in recent years, Block.one has released a new way for users to pay for transactions as they go (rather than the original approach of staking EOS for a percentage of network resources), which sounds a lot like Ethereum’s approach with gas.
Winding back the clock, Block.one launched EOS in a unique way, probably the most hands-off approach of any significant blockchain since Bitcoin. It wrote the code for the software that runs EOS and then it just published it, so that anyone who wanted to kick it off could do so.
As it had given supporters considerable warning around doing this, though, by the time the code was released there was already a global coalition in place running hours-long calls over Google Hangouts to plot the launch of the chain so that one and only one would be viewed as the EOS blockchain.
After fits and starts, the global launch committee finally got the chain running in neutral and then, after another delay, a sufficient number of EOS bagholders cast on-chain votes so that EOS actually started producing blocks on June 14, 2018.
All of this happened at arm’s length from Block.one itself. In fact, Block.one did not start participating in EOS governance until last year, despite being the largest single holder of EOS tokens.
This separation between the software’s originator and its administration may help explain why Block.one got off with a light settlement from the U.S. Securities and Exchange Commission. Once through that regulatory gauntlet, Block.one has been free to pursue its own ideas about the best use of its considerable capital.
Early EOS backers have always believed that ICO funds entrusted to Block.one would be used to drive value back to the blockchain in order to make EOS tokens more valuable. That has never really happened, however, which has driven frustration by longtime EOS backers.
Many, like Colin Talks Crypto, have moved on.
“I just sold 100% of my EOS tokens as a result of this news. For me it was the last straw,” Colin Talks Crypto said in the Jan. 10 video.
The YouTuber is one of the better-known EOS proponents on social media. Besides running multiple social media channels where he discussed cryptocurrency, he also ran an EOS proxy where holders could back his picks for the best block producers (more on these below). Colin Talks Crypto also shut down his proxy following Larimer’s departure.
Before we go any further, here are a few points of context, because the EOS ecosystem can get confusing.
Block.one is the company that ran the ICO that led to the launch of EOS. The ICO ran on Ethereum and then all of the tokens on Ethereum were ported over to EOS. In mid-2019, Bloomberg reported the company had more than $2 billion in cash and 140,000 BTC. Its backers include early Facebook investor and PayPal co-founder Peter Thiel.
Block.one uses its ICO funds by making investments directly and also indirectly, through other funds it has invested in, including Mike Novogratz’s Galaxy Digital. Novogratz sold off shares that Galaxy held in Block.one in 2019.
The most confusing point is probably this one: Block.one built EOSIO, the software that runs EOS. EOSIO is not EOS, and other public blockchains also run on EOSIO, such as Telos, Woldwide Asset Exchange (WAX) and others.
Telos was launched as one of the earliest forks of EOS, and Suvi Rinkinen, CEO of the Telos Foundation, confirmed to CoinDesk that Block.one has never invested in her organization.
“Telos is standing strong, no matter what happens at Block.one. Although we are grateful for the EOSIO codebase, it is the community that makes or breaks public blockchains,” she wrote over Telegram.
EOS was the first and best-known public blockchain launched using EOSIO software and the one that has by far the largest market capitalization. Block.one often speaks of advancing EOSIO but seldom of EOS. This distinction is not lost on EOS holders but it likely is lost on casual observers.
EOS is run using the delegated proof-of-stake consensus mechanism devised by Larimer and first used on STEEM, such that EOS token holders continuously participate in an election of the 21 entities that lead the chain – the parties that can resolve disputes, verify transactions and make upgrades to the network.
Those 21 entities are called “block producers,” and they earn new EOS as it is minted with each block for verifying transactions. They serve basically the same role as miners on the proof-of-work Bitcoin and Ethereum networks.
EOS holders often contend that theirs is the most active blockchain, but subsequent research has cast significant doubt on such claims.
While Larimer has been plotting his move away from Block.one, its CEO, Brendan Blumer, has been talking more and more about bitcoin alongside a pro-regulatory vision for blockchain technology.
In October, Blumer gave an interview to a Forbes contributor, in which he said, “Block.one is a holding company, and see different business emerging but technology projects take a long time.”
In that interview, he said Block.one has three components: building out EOSIO as something that can be used by businesses, investing in other companies and building its own businesses (giving the social network Voice.com as his example).
What he didn’t include seems more salient to EOS token holders: making investments that will drive value to EOS in particular, rather than EOSIO.
In October, at the end of the boom on Ethereum that came to be known as DeFi Summer, EOS holders questioned Blumer on Twitter about why the DeFi boom hadn’t reached EOS.
Block.one, some felt, could have funded versions of Ethereum’s successful use cases on EOS, where presumably they could run with lower transaction fees.
In his response, Blumer wrote, “We are very interested in investing in #EOS DeFi that can meet the compliance requirements of B1, and are actively on the lookout.”
In November, Blumer would use the #ProFi hashtag in another tweet about the inaccessibility of DeFi for institutional investors.
“The innovation in the #DeFi space is revolutionary, but the recent guidance of global regulators regarding its lack of compliance controls makes it difficult for mainstream capital to access the opportunity,” he wrote.
The same day he posted about how regulators are starting to see advantages in BTC, as a form of money that’s easy to supervise, seemingly echoing a point made by former U.S. Treasury Secretary Larry Summers in 2020, that money as we know it has “too much privacy.”
The next day Blumer would take this further, with a Twitter thread in which he describes a compliance-first approach as playing the long game.
He wrote, “At B1, we’re firm believers that the regulatory maturity of the ecosystem is advancing at an exponential rate, and the harmonious integration of both traditional and crypto ecosystems that is facilitated by compliance will continue to pave the path of mainstream adoption.”
In late November and December, his attention on Twitter would turn more and more to Bitcoin, as it did for most people in this industry. He would post about BTC replacing gold and an inadequate supply of BTC for institutional demand.
And then one of Block.one’s investors, Christian Angermayer, would weigh in, calling Block.one’s BTC holdings “the most strategic #Bitcoin position in the world,” adding the hashtag #ProFi.
What good would any of this Bitcoin talk do for EOS holders, though?
Its hard to imagine EOS superseding, for example, Lightning, from within the Bitcoin community as we now know it. EOS today runs on the basis of payoffs to governance participants and there’s no way to know how many of the existing block producers aren’t one or just a few entities or a few entities in collusion.
This is a longstanding tension in crypto, between the pioneers of the space who wanted to build a separate economy and the newcomers looking to maximize profits by plugging it into the traditional economy.
Larimer, as we’ll see, leans toward the former, but Blumer’s allegiance seems to be the latter. He may look forward to a future in which it is not Bitcoin’s existing users relying on EOS so much as institutional adopters that want a solution that’s fast, cheap and easy to track.
“As Brendan has said in recent tweets, Block.one is working on products designed to leverage our Bitcoin position, built with the EOSIO software,” Christina Pantin, a spokesperson for Block.one, told CoinDesk in an email. “We believe that a network like EOS, built on EOSIO, has the capacity and scalability to bridge a highly valuable token like BTC, which is unfortunately slow and expensive to transfer.”
Aaron Cox, of the block producer candidate Greymass, told CoinDesk over Telegram that the EOS community would likely support more BTC integrations.
“With as much tribalism as exists in this space, I don’t think there’s a lot of outward aggression from within the EOSIO community towards other chains – even despite all the hatred EOS/EOSIO gets,” he wrote. “It’s not like EOS or any other EOSIO token (that I’m aware of) is out to replace projects like BTC – so it only makes sense to find ways they can support each other.”
One longtime member of the EOS community is less excited about the prospects for BTC on EOS. A pseudonymous user going by @blockchainkid on Telegram and Twitter posted:
“Let’s call a spade a spade: the $EOS token sale was just a massive wealth transfer from retail crypto buyers to @block_one_ founders and early investors.”
A series of disappointments
Colin Talks Crypto and @blockchainkid aren’t the only ones who took to social media to express disappointment.
Larimer also does not seem happy with how this endeavor has turned out.
There’s a meme around Larimer that he always abandons projects, but he’s been working on EOS for at least three years now. And it’s important to also note the major contributions he has made in the industry. They include laying the foundation for DeFi, building software to run a new consensus model and articulating the concept of decentralized autonomous organizations (DAOs).
“I do not know exactly what is next, but I am leaning toward building more censorship resistant technologies. I have come to believe that you cannot provide ‘liberty as a service’ and therefore I will focus my attention on creating tools that people can use to secure their own freedom.”
“What can we do to make EOS ‘successful’? There is no single answer to that question because we all have different definitions of ‘success’ and the paths to ‘success’ can head in opposite directions. The most common definition of ‘success’ that I see is a high token price. EOS is ‘successful’ if everyone who buys it makes money. What if EOS achieved this ‘success’ by becoming a completely regulated, centralized, walled garden of KYC’d users?”
These comments seem to come somewhat in response to those above from his co-founder, emphasizing an investor- and regulator-friendly future for the protocol Larimer created. For his part, Larimer only had frustration for an era in which every interaction with cryptocurrency incurs a taxable event.
Larimer also seemed disappointed in the EOS community’s failure to function as the sort of DAO he had envisioned. After all, it wasn’t essential for them to rely on Block.one to build on EOS. The blockchain was built to fund development itself.
The EOS design assumed that token holders would support block producer candidates who did the most to drive value to the blockchain by reinvesting the tokens they earned in funding EOS applications. EOS was also designed with a fund in place that EOS holders could use collectively to pay for development as a collective.
After failing to create a governance system for EOS, the block producers burned the “savings account” meant to fund such development in May 2019, causing a short-term bump in price but long-term doubts about the community’s commitment to a useful blockchain.
And block producers that built didn’t earn community backing, by and large. Instead, the ones that primarily used their earnings to pay voters to back them came to dominate the leadership roles.
However, the CEO has defended the practice of buying votes on Twitter. “When BP’s offer token holders revenue for their vote, it lowers the cost of network operation by passing value back to holders,” Blumer wrote.
For his part, though, Larimer seemed to share the concerns about bribery that CoinDesk had reported on. He wrote in his Jan. 10 Hive post, “In theory, token holders are supposed to vote in producers that provide the most value to the network. In practice, token holders vote in people who pay them kickbacks. It would be like Apple shareholders electing a board that issued new shares and distributed them as kickbacks to a subset of the shareholders.”
After burning the savings account and devoting the block rewards to payoffs, it’s no wonder the community expected Block.one to build for it. Who else could afford to?
But Block.one has shown little tangible evidence of interest in doing so. After all, the returns on Bitcoin have been so much better.
When Colin Talks Crypto described Larimer’s departure as the “last straw,” he went on to produce another 18 minutes of frustration.
First, the fact that Voice is not running on EOS. When first announced in June 2019, Block.one had said every Voice user would get an EOS account automatically. By January 2020, it had walked that back, indicating that it wouldn’t launch on EOS but that Block.one would “like” it to leverage the EOS public blockchain and “potentially others.”
Last January, CEO Brendan Blumer took to Twitter to describe CoinDesk’s reporting as misleading, but even then he didn’t reiterate the commitment from June, instead writing only that “publishing to public chains will diversify moderation and strengthen censorship resistance.”
Similarly, on Jan. 8, Voice.com CEO Salah Zalatimo wrote in a blog comment that can be seen republished here that the team remains committed to “linking up with the EOS mainnet,” language that falls short of the originally promised plan to run Voice on EOS.
In fact, CoinDesk has been only able to identify one project backed by Block.one that’s running on EOS, and that’s Everipedia. Another company backed by Block.one, Mythical Games, has announced its intention to run on EOS, but CoinDesk has not been able to verify that it has done so. In December, a lead developer tweeted that the game intended to “connect” with the mainnet. A request for comment to the company has not been returned by press time.
When asked to confirm whether or not these were the company’s only investments that run atop EOS, Block.one responded but didn’t answer the question.
“Block.one and its partner funds have made more than 70+ investments into companies already using EOSIO, intending to move to EOSIO, or looking to use EOSIO,” Pantin wrote.
As previously noted, EOSIO is not EOS.
Many EOS holders also found encouragement in the October announcement that Google Cloud would deploy a block producer candidate. There have been no updates on this initiative three months later.
Google confirmed the original report to CoinDesk, but, upon follow-up, Google spokesperson Jane Khodos told CoinDesk in an email, “Unfortunately we can’t comment about our customers.”
One longtime EOS backer emailed CoinDesk last week to say that it might soon be time to write a post-mortem for the blockchain. Of course, the death of EOS is unlikely. Blockchains hardly ever truly die.
But, for many early proponents, including – in particular – the man who created it, it seems the hopes that brought them to EOS have already been laid to rest.
On Jan 19, Blockchain-based Enjin Coin (ENJ) became the first gaming cryptocurrency to be legally authorized for trade by the Japanese Virtual Currency Exchange Association, or JVCEA.
This coincided with a sudden 71% increase to the coin’s dollar value which occurred within just 9 hours, and saw the ENJ coin price jump from $0.236340, up to a 3-year high of $0.406356.
“Enjin Coin has been approved by the JVCEA and will be listed on Coincheck exchange, making it the first gaming token authorized for use in Japan,” said the official Enjin announcement from Jan. 19.
As of Jan. 26, Enjin Coin will become the first gaming token listed on Coincheck, and one of 15 digital currencies in total, including the likes of Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and more. ENJ will be purchasable with JPY, and tradeable against BTC.
Enjin’s in-road to the Japanese market was helped along by Hashport Accelerator. Seihaku Yoshida, CEO of HashPort, said:
“Enjin made a bold commitment entering the Japanese market in 2019, determined to grow their business in the space regardless of market conditions. After more than a year of due diligence, the approval and listing of Enjin Coin on Coincheck is an important milestone for Enjin and adoption of its blockchain platform in Japan.”
Maxim Blagov, Enjin CEO, said the company hoped to take advantage of setting up shop in one of the busiest gaming markets in the world, and aimed to benefit from the nation’s culture of technological innovation:
“From Super Mario to Pokémon and Final Fantasy, Japan is home to pioneering games that hold a lasting place in pop culture. Japan’s culture of innovation is directly aligned with Enjin’s. We believe some of the world’s best blockchain games will come from the Japanese gaming industry, and we will be there to help them leverage this powerful technology to the fullest.”
Enjin Coin was first announced in 2017, and launched a mainnet the following year. In 2019, Enjin made headlines after it was announced Enjin Coin would ship as one of the applications native to the then newly released Samsung Galaxy S10.
Polkastarter (POLS) is a cross-chain token pool and auction protocol built on the Polkadot (DOT) blockchain. It launched in October of 2020 as a way for projects to raise capital in a decentralized environment and since January the token has rallied 500% to a new high at $1.78.
Three possible reasons for the recent growth of POLS are the strong rally seen from Polkadot, strategic partnerships and exchange listings and an expanding list of token launches via auctions.
The rise of Polkadot
The rising popularity of the Polkadot network is arguably the most significant influencer on the price of POLS. Similar to Kusama, Polkastarter’s association with Polkadot could attract additional user and investor attention.
Polkadot’s rally began on Dec. 27, 2020, and it culminated on Jan.15 as DOT saw a 75% price increase in one week. POLS strong rally also reignited on Dec. 27 and followed a similar trajectory to DOT.
Now that DOT has flipped XRP to become the fourth-largest cryptocurrency by market cap, further price strength for Polkadot has the potential to have a positive impact on the overall performance of Polkastarter.
Exchange listings and partnerships
Prior to Jan. 14 POLS was only available on Uniswap and Poloniex. At the time its liquidity was limited and high ETH gas fees also complicated matters for those thinking about trading the token.
After the Huobi exchange announced plans to list POLS on Jan. 14, its trading volume increased from an average of $2 million to $22 million overnight.
Now the POLS community is working on being listed at OKEx and a recent tweet from the project informed supporters that the project only needs 2,000 more votes to qualify.
Listing POLS on another high-volume exchange has the potential to further boost the token’s price as more people will have access to one of the fastest-growing Polkadot based projects.
Successful auctions and token launches
Similar to the initial coin offerings (ICO) that occurred in 2017 and 2018, Polkastarter is gaining momentum due to its ability to attract capital heavy investors looking for the opportunity to get first access to the newest blockchain projects.
Polkastarter’s protocol is designed to enable cross-chain token pools and auctions as a method of raising capital in a decentralized fashion. To date, the platform has conducted 12 separate Initial Decentralized exchange Offerings (IDOs) with 20 different pools consisting of both public and private offerings. To date, only one pool failed to sell out.
The strong rally seen from DOT has only increased the desire of projects wanting to develop on top of Polkadot in order to capitalize on its growing popularity as well as avoid the challenges associated with building on Ethereum.
Tosdis, the most recent IDO conducted on Polkastarter, tweeted the following after its successful auction as an example of the platform’s growing popularity:
“We are really delighted to announce that our IDO on Polkastarter is sold out. POLS pool was sold out in record 30 seconds. After fixing some overloading and gas issues, the public pool was sold out in 90 minutes. We are overwhelmed by the support. Thank you and Stay tuned.”
Polkadot’s rise, successful IDOs on the Polkastarter platform and the listing of POLS on new exchanges have helped propel the value of the token to new highs and investors are optimistic that these strong fundamentals will push the price higher.
In addition to these fundamental factors, Ether’s (ETH) recent surge to a new all-time high has many analysts calling for the start of a new ‘altcoin season’. According to Raoul Pal, the CEO and co-founder of Real Vision Group and Global Macro Investor, traders are likely to plow into “higher risk alts” after Ether secures a new all-time high.
If this prediction does come to pass, it could also mean even brighter days are ahead for the Polkastarter ecosystem.