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Ethereum Gas Fees at 6-Month Low as Congestion Eases

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Transaction fees for Ethereum have dropped to their lowest level since December as blockchain activity has cooled while the use of Ethereum Layer 2 solution protocols like Polygon (MATIC) has warmed up, according to blockchain data and analysts.

As of June 27, the average transaction fee for the Ethereum blockchain was $ 4.42, according to Coin Metrics. That’s a decrease from over $ 60 fee levels that were in mid-May.

Gas refers to the computational effort required to perform certain operations on the Ethereum network. A fee paid in Ether is required to successfully conduct a transaction on Ethereum. Ethereum is the second largest blockchain network after Bitcoin.

High gas fees are one of the biggest challenges for Ethereum in an age of increasing network usage. The interest in decentralized financing (DeFi) has increased along with the price of ether.

Analysts told CoinDesk that lower gas fees are a natural response to the recent slowdown in the crypto market.

At press time, Ether was trading at around $ 2,103.77, less than half of the all-time high of $ 4,382.73 reached on May 11, according to CoinDesk 20 data.

Read more: Polygon price climbs to record high and benefits from Ethereum congestion

The congestion on the Ethereum blockchain has decreased with the price of the cryptocurrency. According to Coin Metrics, transactions on the network fell to around 1.1 million on June 27, from a May high of around 1.7 million. CoinGecko data shows that the trading volume of ether on the exchanges has also decreased significantly.

The exchange data is consistent with the activities on decentralized exchanges (DEX). Data from Dune shows that weekly DEX volume fell below $ 20 billion for the week of June 21st, from over $ 40 billion for the week of May 17th.

Weekly DEX trading volume.

Source: Dune Analytics

Lower gas charges “mean network activity is not as high,” said Vishal Shah, founder of the Alpha5 exchange. And because Ethereum is a basis for many DEXs, “this also implies that less speculative volume is handled”.

At the same time, the increasing adoption of Ethereum Layer 2 solutions like Polygon has also helped lower Ethereum gas fees, as CoinDesk recently reported. Analysts have seen a “significant number” of users switching from Ethereum to Polygon; many Ethereum-native DeFi protocols such as Aave, Kyber Network and SushiSwap have recently switched to the protocol.

Another contributing factor to the reduced gas fees is the shift in the types of bot used by Ether and DeFi traders, according to Ryan Watkins, a research analyst at Messari.

Traders had previously used an auction called the Priority Gas Auction (PGA) to raise gas fees in order to be first in line with transactions. They recently moved to Flashbots, where miners and traders transfer their communications from the blockchain to private channels.

Ordering transactions on Ethereum is important, as CoinDesk’s research fellow Christine Kim wrote in her Valid Points newsletter on May 12th. Especially for traders at DEXs, being milliseconds ahead of another trader can mean an opportunity to make thousands of dollars.

Read more: Valid points: MEV on Eth 2.0: The Good, Bad and Ugly

The Cumulative Maximum Extractable Value (MEV), or amount of money a miner on Ethereum is to make as a direct result of its ability to insert, omit, and rearrange transactions within a block, has been falling since the beginning of June and is a little over 700 million US dollars, according to the Flashbots MEV dashboard.

In short, Flashbots “helped mitigate the unnecessary gas wars that arbitrage bots were involved in to fuel each other,” Watkins said.

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Afghans Embrace Cryptocurrency Amid Financial Crisis

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In view of currency bottlenecks and bank closings, the Afghans are relying on cryptocurrency as security

* Afghans take cryptocurrency as a currency crash

* Crypto is particularly beneficial for women and people without a bank account

* Growing acceptance in failed or poorly governed countries

By Rina Chandran

(Thomson Reuters Foundation) – When Roya Mahboob started paying her employees and freelancers in Afghanistan with Bitcoin almost 10 years ago, little did she know that the digital currency for some of these women would be the ticket out of the country for some of these women after the fall of Kabul in August.

Mahboob, who co-founded the non-profit Digital Citizen Fund with her sister, taught basic computer skills to thousands of girls and women in their centers in Herat and Kabul. Women also wrote blogs and made videos that were paid for in cash.

Most girls and women didn’t have a bank account because they weren’t allowed to or because they didn’t have the documentation, so Mahboob used the informal hawala broker system to send money – until she discovered Bitcoin.

“It wasn’t feasible – or safe – to send cash to everyone, but mobile money wasn’t used as widely and options like PayPal didn’t exist. Then we heard about Bitcoin, ”Mahboob, 34, told the Thomson Reuters Foundation.

“It was easy to use, cheaper, and safer than other options. So we taught the girls how to use it and started paying our staff and contributors – we told them it was an investment in the future, ”she said.

About a third of the nearly 16,000 girls and women who learned basic computer skills at Mahboob’s centers also learned how to set up a crypto wallet and receive money – and, if they felt like it, how to trade and invest in Bitcoin and Ethereum another major cryptocurrency.

Several of these women left the country after Kabul was captured by the Taliban on Aug. 15, and some used their crypto wallets to withdraw their money, evacuate their families and settle in new lands, Mahboob said.

Cryptocurrency adoption is growing rapidly around the world, with El Salvador becoming the first country to adopt Bitcoin as legal tender last month, despite fears of excluding the poor of nations.

Even if major institutional investors have pushed Bitcoin to record highs this year, it is increasingly being adopted by those without access to the formal banking system, by those in conflict zones or in countries with poor governance, technology and financial experts.

“In failed or challenged states, it gives people an opportunity to support family members,” said Keith Carter, associate professor at the National University of Singapore School of Computing, citing Venezuela, where people bought essentials with Dogecoin after the local currency had gone into free fall.

“Cryptocurrency goes, if at all, where there is a lack of digital infrastructure and promotes the development of the infrastructure through the increasing demand for digital services,” he said.

‘GOOD OPTION’

Cryptocurrencies are shifting from the edge of the financial world to the mainstream, with large investors, corporations, and even countries adopting them as an asset and routine currency.

But it is precisely in countries like Afghanistan, where the majority have no bank accounts, where banks are closed for a long time and the currency has taken a nosedive, that their most passionate fans appear.

Like 22-year-old Farhan Hotak, who helped his family escape to Pakistan from the southern province of Zabul, he then returned to monitor his home and post vlogs on Instagram about the developing situation for his more than 20,000 followers .

Hotak got into cryptocurrency around 2019, he said after hearing about the huge profits that could be made with Bitcoin. With last year’s lockdowns to contain the coronavirus pandemic, he was online most of the time and started investing.

He made quick profits at first, then began following crypto users elsewhere and investing in newer coins like Matic, XRP, and xHunter.

“It’s a good option for me and for others like me,” said Hotak, who posted vlogs about crypto on his Instagram account and was also interested in his friends.

“I would like to set up a crypto course for Afghans – help them understand it better so that it can help them. In the meantime, I’ll be talking about crypto in every province I visit, ”he added.

While advocates of cryptocurrency point to benefits including as a hedge against political uncertainty, hyperinflation, and a way to send remittances without commissions or brokers, governments remain cautious, and China banned all crypto-related activity last month.

Researchers at the University of Technology Sydney found that almost half of all Bitcoin transactions from 2009 to 2017 were related to buying and selling illegal goods and services, with about one in three users involved in such activities.

While a report by research firm Chainalysis showed that the criminal share of all cryptocurrency activity fell from 2.1% in 2019 to 0.34% of total transaction volume last year.

Despite the challenges, the cryptocurrency has provided a lifeline for Mahboob and her former students, as well as for the growing user base of mostly young men in Afghanistan.

“I think now – why didn’t we teach more aggressively about crypto so that more Afghans have crypto wallets and can now access their money,” said Mahboob, who was named Time Magazine’s 100 Most Influential People in 2013.

“The human traffickers and kidnappers will always find a way to abuse a system. But the power of crypto is greater – especially for women and those who don’t have a bank account, it is very beneficial and so empowering, “she said.

Reporting by Rina Chandran @rinachandran; Adaptation by Zoe Tabary. Credit to Thomson Reuters

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All you need to know about smart contracts

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NEW DELHI: Smart contracts are the new technological favorites in the crypto world.
Top cryptocurrencies like Ethereum, Cardano, Polkadot and Solana have adopted them to improve their performance and competitiveness.
How do contracts help you achieve all of this? Here are some essential technical facts ”
What are smart contracts?
Smart contracts may sound like a new kind of technology, but they have been around since 1994 when Nick Szabo, an American computer scientist, developed them with the idea of ​​self-executing digital code in mind.
Basically, these are computer programs that run on blockchain and that execute contracts or agreements if the contracting parties agree on the specified conditions.
These terms are the terms of the agreement between two or more unknown parties. The best part is that executing a contract doesn’t require any paperwork or intermediaries.
Activities such as exchanging funds, stocks, valuables and even property are intelligently carried out between the parties after the requirements have been met with the help of technology. However, transactions with smart contracts are irreversible or immutable.
How does the technology work?
To understand how the technology works, it is important to understand three crucial components of smart contracts. These are the signatories, subjects, and terms.
* Signers are simply the parties who sign the contracts after agreeing to mutually agreed terms, which include the process that follows after the contract is executed.
* The subject matter is the ownership or rights over the transaction of goods and services that the party who bought or acquired a certain value receives after paying a certain amount in cryptocurrency.
Smart contracts work with the if this / then the language that is coded in the blockchain. This means that when the necessary conditions are met, the mutual agreement is automatically enforced through computer codes.
Advantages of smart contracts:
* Smart contracts are inexpensive as there are no paperwork and fees involved in initiating the process.
* You save time as there is no need for complex administrative and official processes.
* You eliminate the need for third parties or intermediaries who grant the parties great independence and decentralized platforms.
* You are efficient and trustworthy with traceable transactions and technology that consistently duplicates the documents to rescue in case of data loss.
Other uses of smart contracts:
Smart contracts are popularly known for being used in cryptocurrencies and the DeFi world. But they are also used in other areas:
* Health – It is used in health insurance to securely record the insurance amount and insurance policy, which are automatically activated and reach the hospital when the patient needs them for a medical procedure.
* Insurance – Used here to prevent fraud and to link the customer directly to their insurance contract.
Fizzy, a flight delay product launched by French insurance company AXA, automatically pays customers for a flight delay of more than two hours.
* Trade – It can be used as a substitute for manual laborious work, such as
However, smart contracts are not immune to cyber vulnerabilities, some of which are:
* Denial of Service – Repeated attacks result in the shutdown of services for the users.
* Random Access Memory Exploitation – This involves the occupation and blocking of RAM, which discourages users from using RAM-based operations.
In order to prevent such errors in the contracts, the best programming language should be used to write the smart contracts on the respective blockchain. Ethereum, for example, prefers the Solidity computer language, while NEO uses JavaScript.
(For the latest crypto news and investment tips, follow ours Cryptocurrency page and for live price updates for cryptocurrencies, Click here.)

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Cryptocurrency may be tender of choice in future, but is risky investment now | Opinion

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Cryptocurrency is taking the nation by storm, with digital currency attracting the attention of large companies and meme traders trading based on popular internet trends. Some financial advisors advise their clients to buy in, while others are not as optimistic.

Although crypto is likely to grow in importance in the future, it currently remains a risky investment as it is too unstable and overshadowed by many uncertainties.

Crypto was developed as a payment method that can bypass traditional banking systems. New crypto is created through mining, a process by which computers solve difficult math problems. There are thousands of flavors of crypto, but Bitcoin is dominant, taking almost half of the market share.

One problem with cryptocurrency is that certain coins are available indefinitely, which means that an infinite amount of crypto could be mined at infinite time. This has led to inflation in the crypto markets, which can also happen with physical currency.

This problem alone is not enough to warrant a hold or sell rating, but what is even more worrying is that cryptocurrencies are being propelled by meme trading. This trading style is named after an online community of merchants who have gathered around “stonks” like GameStop and AMC Entertainment Holdings who have supported low-value companies through the Reddit site r / wallstreetbets.

When meme traders focus on one company, they are quick to invest to drive the stock price higher. Then, when the stock appears to have peaked, investors quickly sell their holdings in a process known as “pump and dump”. This type of trading is detrimental to the markets and can result in significant losses for both large companies and individual traders. Crypto has become a preferred investment for meme traders, making it riskier and less reliable.

Another factor to consider before investing is how quickly crypto values ​​can go up and down. When Elon Musk tweeted about the Dogecoin cryptocurrency, the price fluctuated sharply. This is a bad sign for cryptocurrency coins because if negative news got out about them, their prices could go down and the investment would be lost.

Some companies are optimistic about crypto as an investment, including the El Salvador government, which introduced Bitcoin as its national currency. The move showed that cryptocurrencies are likely to be widely used in the future, but it also highlighted some of the risks associated with investing at this early stage.

When El Salvador started using Bitcoin, the government had to take its e-wallet offline for several hours when the server was overloaded, which revealed a bug in the system. Crypto is only good if it can be used, and if the servers are overloaded it cannot be used. In the future, this problem could be resolved, but until then, crypto is still an unreliable and dangerous investment.

Another major problem with crypto platforms was uncovered when they mistakenly gave users nearly $ 90 million worth of various crypto coins during a routine update in late September. The error was caused by a bug in the computer code and prompted the workers to recover the lost coins.

Both incidents show that this technology is too new and unreliable to be a safe investment. There are thousands of other investment options with far less risk and almost the same return, including stocks and options.

For now, investors should stay away from crypto, but it will become a viable investment in the future. Technology is improving rapidly and culture is changing. One day cash may be a thing of the past and crypto may be the king of currencies, but that day is not here yet.

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