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What Is Uniswap and How Does It Work?

What Is Uniswap and How Does It Work?

Uniswap is a set of computer programs that run on the Ethereum blockchain and allow for decentralized token swaps. It works with the help of unicorns (as illustrated by their logo).

Traders can exchange Ethereum tokens on Uniswap without having to trust anyone with their funds. Meanwhile, anyone can lend their crypto to special reserves called liquidity pools. In exchange for providing money to these pools, they earn fees.

How do these magical unicorns convert one token to the other? What do you need to use Uniswap? Let’s read on.

Introduction

Centralized exchanges have been the backbone of the cryptocurrency market for years. They offer fast settlement times, high trading volume, and continually improving liquidity. However, there’s a parallel world being built in the form of trustless protocols. Decentralized exchanges (DEX) require no middlemen or custodians to facilitate trading.

Due to the inherent limitations of blockchain technology, it has been a challenge to build DEXes that meaningfully compete with their centralized counterparts. Most DEXes could improve both in terms of performance and user experience.

Many developers have been thinking about new ways to build a decentralized exchange. One of the pioneers of this is Uniswap. The way Uniswap works may be a bit more difficult to understand than a more traditional DEX. However, we’ll soon see that this model brings some attractive benefits.

As a result of this innovation, Uniswap has become one of the most successful projects that’s part of the Decentralized Finance (DeFi) movement.

Let’s see what Uniswap is, how it works, and how you can swap tokens on it simply with an Ethereum wallet.

What is Uniswap?

Uniswap is a decentralized exchange protocol built on Ethereum. To be more precise, it is an automated liquidity protocol. There is no order book or any centralized party required to make trades. Uniswap allows users to trade without intermediaries, with a high degree of decentralization and censorship-resistance.

Uniswap is open-source software. You can check it out yourself on the Uniswap GitHub.

Ok, but how do trades happen without an order book? Well, Uniswap works with a model that involves liquidity providers creating liquidity pools. This system provides a decentralized pricing mechanism that essentially smooths out order book depth. We’ll get into how it works in more detail. For now, just note that users can seamlessly swap between ERC-20 tokens without the need for an order book.

Since the Uniswap protocol is decentralized, there is no listing process. Essentially any ERC-20 token can be launched as long as there is a liquidity pool available for traders. As a result, Uniswap doesn’t charge any listing fees, either. In a sense, the Uniswap protocol acts as a kind of public good.

The Uniswap protocol was created by Hayden Adams in 2018. But the underlying technology that inspired its implementation was first described by Ethereum co-founder, Vitalik Buterin.

How does Uniswap work?

Uniswap leaves behind the traditional architecture of digital exchange in that it has no order book. It works with a design called Constant Product Market Maker, which is a variant of a model called Automated Market Maker (AMM).

Automated market makers are smart contracts that hold liquidity reserves (or liquidity pools) that traders can trade against. These reserves are funded by liquidity providers. Anyone can be a liquidity provider who deposits an equivalent value of two tokens in the pool. In return, traders pay a fee to the pool that is then distributed to liquidity providers according to their share of the pool. Let’s dive into how this works in more detail.

Liquidity providers create a market by depositing an equivalent value of two tokens. These can either be ETH and an ERC-20 token or two ERC-20 tokens. These pools are commonly made up of stablecoins such as DAI, USDC, or USDT, but this isn’t a requirement. In return, liquidity providers get “liquidity tokens,” which represent their share of the entire liquidity pool. These liquidity tokens can be redeemed for the share they represent in the pool.

So, let’s consider the ETH/USDT liquidity pool. We’ll call the ETH portion of the pool x and the USDT portion y. Uniswap takes these two quantities and multiplies them to calculate the total liquidity in the pool. Let’s call this k. The core idea behind Uniswap is that k must remain constant, meaning the total liquidity in the pool is constant. So, the formula for total liquidity in the pool is:

x * y = k

So, what happens when someone wants to make a trade?

Let’s say Alice buys 1 ETH for 300 USDT using the ETH/USDT liquidity pool. By doing that, she increases the USDT portion of the pool and decreases the ETH portion of the pool. This effectively means that the price of ETH goes up. Why? There is less ETH in the pool after the transaction, and we know that the total liquidity (k) must remain constant. This mechanism is what determines the pricing. Ultimately, the price paid for this ETH is based on how much a given trade shifts the ratio between x and y.

It’s worth noting that this model does not scale linearly. In effect, the larger the order is, the more it shifts the balance between x and y. This means that larger orders become exponentially more expensive compared to smaller orders, leading to larger and larger amounts of slippage. It also means that the larger a liquidity pool is, the easier it is to process large orders. Why? In that case, the shift between x and y is smaller.

Uniswap v3

The technology behind Uniswap has seen several iterations so far. Chances are, if you’ve used Uniswap, you used Uniswap v2. However, there are always new improvements in the pipeline. Let’s go through the most impactful updates brought forth by Uniswap v3.

Capital efficiency

One of the most significant changes coming with Uniswap v3 relates to capital efficiency. You see, most AMMs are very capital inefficient – that is, most of the funds sitting in them at any given moment are not being used. This is due to an inherent characteristic of this x*y=k model discussed earlier. In a simplified way, the more liquidity there is in the pool, the bigger orders the system can support in a larger price range.

However, liquidity providers (LPs) in these pools essentially provide liquidity for a price curve (range) between 0 and infinity. All that capital is sitting there reserved for the scenario when one of the assets in the pool 5x-s, 10x-s, 100x-s.

If that happens, those idle assets ensure that there’s still liquidity left on that part of the price curve. This means that only a small portion of the liquidity in the pool is sitting where most of the trading happens.

As an example, Uniswap currently has about 5B dollars of liquidity locked, while it does only about 1B of volume per day. You might think this isn’t a particularly elegant way of doing things, and it appears that the Uniswap team agrees. Uniswap v3 addresses this issue.

Liquidity providers can now set custom price ranges for which they want to provide liquidity for. This should lead to more concentrated liquidity in the price range that most trading activity happens in.

In some sense, Uniswap v3 is a rudimentary way of creating an on-chain order book on Ethereum, where market makers can decide to provide liquidity in the price ranges they set. It’s worth noting that this change favors professional market makers over retail participants. The beauty of AMMs is that anyone can provide liquidity and put their funds to work.

However, with this additional layer of complexity, “lazy” LPs are going to earn much less in trading fees than professional players who can constantly keep optimizing their strategy. At the same time, it’s not hard to imagine aggregators like yearn.finance offering retail LPs a way to remain somewhat competitive in this environment.

Uniswap LP tokens as NFTs

We now understand that each Uniswap LP position is unique since each depositor can set their own price range. This means that Uniswap LP positions are not fungible anymore. As a result, each LP position is now represented by a non-fungible token (NFT).

One of the advantages of representing a Uniswap LP position with a fungible token was how it could be used in other parts of DeFi. Uniswap v2 LP tokens could be deposited into Aave or MakerDAO as collateral. This is no longer the case with v3 since each position is unique. However, this break of composability may be solved with new types of derivative products.

Uniswap on layer 2

Transaction fees on Ethereum have skyrocketed in the last year. This makes using Uniswap economically nonviable for many of the smaller users.

Uniswap v3 will also be deployed on a layer 2 scaling solution called an Optimistic rollup. It’s a neat way to scale smart contracts while still getting security from the Ethereum network. This deployment should lead to a massive increase in the transaction throughput and much lower fees for users.

What is impermanent loss?

As we’ve discussed, liquidity providers earn fees for providing liquidity to traders who can swap between tokens. Is there anything else liquidity providers should be aware of? Yes. There’s an effect called impermanent loss.

Let’s say that Alice deposits 1 ETH and 100 USDT in a Uniswap pool. Since the token pair needs to be of equivalent value, this means that the price of ETH is 100 USDT. At the same time, there’s a total of 10 ETH and 1,000 USDT in the pool – the rest funded by other liquidity providers just like Alice. This means that Alice has a 10% share of the pool. Our total liquidity (k), in this case, is 10,000.

What happens if the price of ETH increases to 400 USDT? Remember, the total liquidity in the pool has to remain constant. If ETH is now 400 USDT, that means that the ratio between how much ETH and how much USDT is in the pool has changed. As a matter of fact, there is 5 ETH and 2,000 USDT in the pool now. Why? Arbitrage traders will add USDT to the pool and remove ETH from it until the ratio reflects the accurate price. This is why it’s crucial to understand that k is constant.

So, Alice decides to withdraw her funds and gets 10% of the pool according to her share. As a result, she gets 0.5 ETH and 200 USDT, totaling 400 USDT. It seems like she made a nice profit. But hang on, what would have happened if she didn’t put her funds in the pool? She’d have 1 ETH and 100 USDT, totaling 500 USDT.

In fact, Alice would have been better off by HODLing rather than depositing into the Uniswap pool. In this case, the impermanent loss is essentially the opportunity cost of pooling a token that appreciates in price. This just means that by depositing funds into Uniswap in hopes of earning fees, Alice may lose out on other opportunities.

Note that this effect works regardless of what direction the price changes from the time of the deposit. What does this mean? If the price of ETH decreases compared to the time of the deposit, the losses may also be amplified. If you’d like to get a more technical explanation for this, check out Pintail’s article about it.

But why is the loss impermanent? If the price of the pooled tokens returns to the price when they were added to the pool, the effect is mitigated. Also, since liquidity providers earn fees, the loss may get balanced out over time. Even so, liquidity providers need to be aware of this before adding funds to a pool.

How does Uniswap make money?

It doesn’t. Uniswap is a decentralized protocol backed by Paradigm (a crypto hedge fund). All fees go to liquidity providers, and none of the founders get a cut from the trades that happen through the protocol.

Currently, the transaction fee paid out to liquidity providers is 0.3% per trade. By default, these are added to the liquidity pool, but liquidity providers can redeem them at any time. The fees are distributed according to each liquidity provider’s share of the pool.

A portion of fees may be dedicated to Uniswap development in the future. The Uniswap team has already deployed an improved version of the protocol called Uniswap v2.

How to use Uniswap

Uniswap is an open-source protocol, meaning that anyone could create their own frontend application for it. However, the most commonly used one is https://app.uniswap.org or https://uniswap.exchange.

  • Go to the Uniswap interface.
  • Connect your wallet. You can use MetaMask, MetaMask, Trust Wallet, or any other supported Ethereum wallet.
  • Select the token you’d like to exchange from.
  • Select the token you’d like to exchange to.
  • Click on Swap.
  • Preview the transaction in the pop-up window.
  • Confirm the transaction request in your wallet.
  • Wait for the transaction to be confirmed on the Ethereum blockchain. You can monitor its status on https://etherscan.io/.

The Uniswap (UNI) token

UNI is the native token of the Uniswap protocol, and it entitles its holders to governance rights. This just means that UNI holders can vote on changes to the protocol. We’ve discussed earlier how the protocol has already been acting as a sort of public good. The UNI token solidifies this idea.

1 billion UNI tokens have been minted at genesis. 60% of those are distributed to existing Uniswap community members, while 40% will be made available to team members, investors and advisors over the course of four years.

Part of the community distribution happens through liquidity mining. This means that UNI will be distributed to those who provide liquidity to the following Uniswap pools:

  • ETH/USDT

  • ETH/USDC

  • ETH/DAI

  • ETH/WBTC

But who are Uniswap community members? Well, any Ethereum address that has interacted with the Uniswap contracts. Let’s see how you can claim UNI tokens.

How to claim Uniswap (UNI) tokens

If you’ve used Uniswap, you can likely claim 400 UNI tokens per address that you used Uniswap with. To claim your tokens:

  • Go to https://app.uniswap.org/.

  • Connect the wallet that you previously used Uniswap with.

  • Click on “Claim your UNI tokens”.

how-to-claim-uni-tokens-uniswap

  • Confirm the transaction in your wallet (you can check the current gas prices at the Ethscan Gas Tracker).

  • Congratulations, you’re now a UNI holder!

Want to trade your UNI tokens? Binance has you covered.

How to buy UNI on Binance

To buy UNI, you will need to swap either fiat or crypto using the Binance exchange view. You cannot use a debit/credit card to purchase UNI directly. Below are the possible pairs, giving you a choice of BNB, BTC, BUSD, USDT, or EUR.

To purchase UNI with crypto, you can either transfer crypto into your Spot Wallet to swap or buy some crypto with fiat. BUSD is one recommended option because its price stability. You can purchase BUSD with your card by heading to the [Buy Crypto]. page. Enter the amount you want to buy and click [Continue] to fill out your card details.

Once you have your crypto, head to the exchange and select the UNI pair you want to trade. You can change your pair by clicking the current market pair in the top left.

In the search bar, type in your chosen pair. For our example, we need UNI/BUSD.

You can now create an order to buy UNI. The quickest way is with a market order giving you the current spot price. You could also set a limit order or stop-limit order if you want to purchase at a specific price or better.

To create your market order, head to the right-hand side of the exchange view and click [Spot]. Make sure you’ve chosen [Market] as your order type underneath the [Buy] tab and type in the amount of BUSD you would like to trade. Finally, click [Buy UNI] to place your order.

How to sell UNI on Binance

Selling your UNI is a similar process to purchasing. First, make sure your UNI is in your Binance Spot Wallet. If you haven’t deposited your tokens, head to the [Fiat and Spot] page and search for UNI. Click [Deposit] for detailed instructions on how to transfer your UNI.

When you’ve successfully deposited your UNI, open the exchange view and select the UNI pair you want to trade. Let’s take a look at UNI/BTC.

Use the search bar to find the pair you’d like. In our case, click [UNI/BTC].

To sell your UNI at the current market price, head to the right-hand side of the screen. Click [Spot] and select [Market] as the order type under the [Sell] tab. Enter the amount of UNI you want to sell and click [Sell UNI].

Closing thoughts

Uniswap is an innovative exchange protocol built on Ethereum. It allows anyone with an Ethereum wallet to exchange tokens without the involvement of any central party.

While it does have its limitations, this technology may have some exciting implications for the future of trustless token swapping. Once Ethereum 2.0 scalability solutions go live on the network, Uniswap could likely benefit from them as well.

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What Are Crypto Cards and How Do They Work?

What Are Crypto Cards and How Do They Work?
A typical crypto card lets you earn crypto rewards or instantly convert your crypto to fiat currency to pay for goods and services. Both Mastercard and Visa issue crypto cards, meaning you can use your crypto in millions of locations globally. A prepaid crypto card is similar to a debit card in that it has to be pre-loaded with crypto to spend. You can get a crypto card from a licensed issuer such as a crypto exchange or bank. However, crypto cards aren't without risk. Your funds stored on the card can still lose their market value, and any transactions you make with your card are likely to be taxable.
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What Is Play-to-Earn and How to Cash Out?

What Is Play-to-Earn and How to Cash Out?
Play-to-earn games allow users to farm or collect crypto and NFTs that can be sold on the market. By playing the game regularly, each player can earn more items or tokens to sell and generate an income. Some players have even begun to supplement or replace their salaries playing these blockchain games. However, such activity involves risk, as you typically need to put up an initial investment to purchase characters and items to play the game. Blockchain helps guarantee the collectibility of these items and create working digital economies. Blockchain technology and NFTs allowed for the creation of digital items that are impossible to duplicate. This created the concept of digital scarcity.
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What Is Uniswap and How Does It Work?

What Is Uniswap and How Does It Work?
Uniswap is a set of computer programs that run on the Ethereum blockchain and allow for decentralized token swaps. It works with the help of unicorns (as illustrated by their logo). Traders can exchange Ethereum tokens on Uniswap without having to trust anyone with their funds. Meanwhile, anyone can lend their crypto to special reserves called liquidity pools. In exchange for providing money to these pools, they earn fees. How do these magical unicorns convert one token to the other? What do you need to use Uniswap? Let’s read on.
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Mining Pools Explained

Mining Pools Explained
Mining is integral to the security of Proof of Work blockchains. By computing hashes with certain properties, participants are able to secure cryptocurrency networks without the need for a central authority. When Bitcoin first launched in 2009, anyone with a regular PC could compete with other miners to guess a valid hash for the next block. That’s because the mining difficulty was low. There wasn’t much hash rate on the network. As such, you didn’t need specialized hardware to add new blocks to the blockchain.
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Who Is Satoshi Nakamoto?

Who Is Satoshi Nakamoto?
Satoshi Nakamoto is the pseudonym behind the development of Bitcoin and the authorship of the original Bitcoin whitepaper. The question “who is Satoshi Nakamoto?” has led to speculation of their true identity as well as people falsely claiming they are Satoshi Nakamoto. The creator of Bitcoin has been clouded in mystery for more than a decade. However, it’s clear that Satoshi still owns bitcoins since their public keys were traced from the genesis block, which Satoshi mined.
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What Is Cryptocurrency Mining?

What Is Cryptocurrency Mining?
Cryptocurrency mining refers to the process of verifying and validating blockchain transactions. It’s also the process that creates new units of cryptocurrencies. The work done by miners requires intensive computational resources, but it’s what keeps a blockchain network secure. Honest and successful miners are rewarded for their work with newly created cryptocurrencies plus transaction fees.
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A Quick Guide to Binance Dual Investment

A Quick Guide to Binance Dual Investment
We all know that to get a return on an investment, we need to buy low and sell high. Investing in cryptocurrency is no different. Binance Dual Investment provides a great way to seize Buy Low and Sell High opportunities while also providing you with additional returns. Let’s dive into how it works and exactly how you can get started.
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Hybrid PoW/PoS Consensus Explained

Hybrid PoW/PoS Consensus Explained
A blockchain’s consensus mechanism serves to ensure that there is agreement among participants on the current state of the blockchain. The consensus mechanism determines who is able to add new blocks of transactions, and one of its primary aims is to ensure that the chain is not re-written.
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Your Guide to Binance Earn

Your Guide to Binance Earn
Not interested in trading but still looking to increase your crypto holdings? Is the 0.05% interest your local bank offers on your savings account not exciting enough? Well, you’ll find alternative choices within the Binance Earn product suite. Binance Earn is your crypto savings account. Here, you’ll find a great variety of options for earning passive income with your crypto holdings.
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Delegated Proof of Stake Explained

Delegated Proof of Stake Explained
The Delegated Proof of Stake (DPoS) consensus algorithm is considered by many as a more efficient and democratic version of the preceding PoS mechanism. Both PoS and DPoS are used as an alternative to the Proof of Work consensus algorithm, since a PoW system requires, by design, lots of external resources. The Proof of Work algorithm makes use of a large amount of computational work in order to secure an immutable, decentralized and transparent distributed ledger. Contrarily, PoS and DPoS require fewer resources and are, by design, more sustainable and eco-friendly. To understand how Delegated Proof of Stake works, one must first grasp the basics of the Proof of Work and Proof of Stake algorithms that preceded it.
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Proof of Burn Explained

Proof of Burn Explained
While most blockchain systems either make use of a Proof of Work (PoW) or a Proof of Stake (PoS) consensus algorithm, the Proof of Burn (PoB) is being tested as a possible alternative to those.
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Proof of Authority Explained

Proof of Authority Explained
The cryptocurrency space has changed a lot since the first blockchain transaction on the Bitcoin network. Along with the well-known Proof of Work and Proof of Stake algorithms, other consensus mechanisms were proposed, with alternative methods for reaching consensus within a blockchain system.
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What Is a DoS Attack?

What Is a DoS Attack?
In short, a DoS attack (or Denial-of-Service attack) is a method used to disrupt legitimate users' access to a target network or web resource. Typically, this is accomplished by overloading the target (often a web server) with a massive amount of traffic - or by sending malicious requests that cause the target resource to malfunction or crash entirely.
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What Is a 51% Attack?

What Is a 51% Attack?
Before diving into the 51% attack, it is crucial to have a good understanding of mining and blockchain-based systems. One of the key strengths of Bitcoin and its underlying blockchain technology is the distributed nature of building and verifying data. The decentralized work of the nodes ensures that the protocol rules are being followed and that all network participants agree on the current state of the blockchain. This means that the majority of nodes need to regularly reach consensus in regards to the process of mining, to the version of the software being used, to the validity of transactions, and so forth.
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Delayed Proof of Work Explained

Delayed Proof of Work Explained
Delayed Proof of Work (dPoW) is a security mechanism designed by the Komodo project. It is basically a modified version of the Proof of Work (PoW) consensus algorithm that makes use of Bitcoin blockchain’s hashpower as a way to enhance network security. By using dPoW, Komodo developers are able to secure not only their own network but also any third-party chain that ends up joining the Komodo ecosystem in the future. In fact, dPoW can be implemented for any project that develops an independent blockchain using a UTXO model.
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What Is a Blockchain Consensus Algorithm?

What Is a Blockchain Consensus Algorithm?
A consensus algorithm is a mechanism that allows users or machines to coordinate in a distributed setting. It needs to ensure that all agents in the system can agree on a single source of truth, even if some agents fail. In other words, the system must be fault-tolerant (see also - Byzantine Fault Tolerance Explained). In a centralized setup, a single entity has power over the system. In most cases, they can make changes as they please – there isn’t some complex governance system for reaching consensus amongst many administrators.
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5 BSC Metaverse Projects You Should Know

5 BSC Metaverse Projects You Should Know
The metaverse is an online, immersive space where users can work, play, and socialize in a 3D environment. The metaverse is still developing, but blockchain technology already plays a significant role. BNB Smart Chain (BSC) is the home to many metaverse projects experimenting with play-to-earn blockchain games and community sandboxes.decentral.games lets users play and run their own casino through governance mechanisms. Cyber Dragon and Alien Worlds both provide an RPG-like experience where players have their own character, missions, and loot. TopGoal is also gaming-related but focuses on the collectability of Non-Fungible Tokens (NFTs) to represent sports stars like trading cards.
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A Beginner's Guide to Earning Passive Income With Crypto

A Beginner's Guide to Earning Passive Income With Crypto
Trading or investing in projects is one way to make money in the blockchain industry. However, that typically requires detailed research and a substantial investment of time – but it still won’t guarantee a reliable source of income. Even the best investors can experience prolonged periods of loss, and one of the ways to survive them is to have alternative sources of income.
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What Is Crypto Lending and How Does It Work?

What Is Crypto Lending and How Does It Work?
Crypto lending lets users borrow and lend cryptocurrencies for a fee or interest. You can instantly get a loan and start investing just by providing some collateral. This could be through a DeFi lending DApp or a cryptocurrency exchange. When your collateral falls below a certain value, you will need to top it up to the required level to avoid liquidation. When you return your loan plus a fee, your capital is unlocked.
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A Beginner's Guide to Decentralized Finance (DeFi)

A Beginner's Guide to Decentralized Finance (DeFi)
DeFi lets users access crypto financial services with just no more than a wallet with some crypto. A range of DApps facilitates lending, liquidity provision, swaps, staking, and more across many blockchains. While Ethereum was DeFi's original home, most blockchains with smart contract capabilities now host DeFi DApps. Smart contracts are essential to the services DeFi offers, which include staking, investing, lending, harvesting, and more.
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5 NFT Projects You Should Know

5 NFT Projects You Should Know
The interest in NFTs has exploded. While many NFT projects had a small community of enthusiasts since their early existence, 2021 has brought forth a bit of an NFT bubble. Many thought DeFi would bring mainstream adoption to the crypto space. However, it seems like the value proposition of NFTs is much easier to grasp for people not involved with blockchain technology. As such, some NFT projects have even entered the mainstream. But which ones are they?
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Top 3 NFT Projects on Binance Smart Chain

Top 3 NFT Projects on Binance Smart Chain
The demand for non-fungible tokens (NFTs) keeps growing on Binance Smart Chain (BSC). The blockchain’s speed and low transaction fees make it very attractive for both users and developers. On BSC, Battle Pets, PancakeSwap, and BakerySwap have all pushed further the limits of what an NFT can do. Both Battle Pets and BakerySwap combine collectibles with Decentralized Finance (DeFi) staking for their tokens. PancakeSwap is also experimenting with NFTs that merge collectability, financial utility, and gamification.
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Top 7 NFT Use Cases

Top 7 NFT Use Cases
Massive interest in non-fungible tokens has led to a boom in crypto-collectibles and NFT art. These are two of the most prominent use cases in the DeFi ecosystem, but they aren’t the only applications. Scarcity and uniqueness make non-fungible tokens a good match for real-world assets, logistics, music royalties, and more. As NFTs mature, we can expect to see further adoption of more experimental use cases.
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What Are NFT Games and How Do They Work?

What Are NFT Games and How Do They Work?
NFTs are unique digital collectibles on the blockchain. This feature makes them suitable to use in games as representations as characters, consumables, and other tradeable items. NFT games have become popular in the Game-fi world as a way to earn income. You can sell your in-game NFTs to other collectors and players and even earn tokens with play-to-earn models.
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What Is the Metaverse?

What Is the Metaverse?
The metaverse is a concept of a persistent, online, 3D universe that combines multiple different virtual spaces. You can think of it as a future iteration of the internet. The metaverse will allow users to work, meet, game, and socialize together in these 3D spaces.
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What Are CryptoPunks?

What Are CryptoPunks?
CryptoPunks are collectible pieces of crypto art, represented by NFTs on the Ethereum blockchain. There are 10,000 small, 8-bit-style punks, all with unique features. As one of the first famous NFT projects, they inspired a lot of crypto artists and even the development of the ERC-721 token standard for digital collectibles. The project became more popular in 2021 after some CryptoPunks were sold for millions of dollars, making them some of the most expensive NFTs.
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What Is an Automated Market Maker (AMM)?

What Is an Automated Market Maker (AMM)?
You could think of an automated market maker as a robot that’s always willing to quote you a price between two assets. Some use a simple formula like Uniswap, while Curve, Balancer and others use more complicated ones.
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A Guide to Crypto Collectibles and Non-fungible Tokens (NFTs)

A Guide to Crypto Collectibles and Non-fungible Tokens (NFTs)
The creation of Bitcoin introduced the concept of trustless, digital scarcity. Before it, the cost of digitally copying something was next to nothing. With the advent of blockchain technology, programmable digital scarcity has become possible – letting us map the digital world to the real world. Non-fungible tokens (NFTs), often referred to as crypto collectibles, expand this idea. Unlike cryptocurrencies, where each token is equal, non-fungible tokens are unique and limited in quantity.
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Decentralized Autonomous Organizations (DAOs) Explained

Decentralized Autonomous Organizations (DAOs) Explained
Blockchains are already radically transforming our financial system. However, properties such as trustlessness and immutability aren’t only useful in monetary applications. Another potential candidate ripe for disruption by this technology is governance. Blockchains could enable entirely new types of organizations that can run autonomously without the need for coordination by a central entity. This article will give an introduction to what these organizations might look like.
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A Beginner's Introduction to Cryptoeconomics

A Beginner's Introduction to Cryptoeconomics
In simple terms, cryptoeconomics provides a way to coordinate the behavior of network participants by combining cryptography with economics. More specifically, cryptoeconomics is an area of computer science that attempts to solve participant coordination problems in digital ecosystems through cryptography and economic incentives.
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Pyramid and Ponzi Schemes

Pyramid and Ponzi Schemes
Most individuals that invest in Bitcoin – or that participate in Initial Coin Offering (ICO) events – are usually concerned about two things. First, the Return of Investment (ROI), which represents the profits they will eventually make from the initial investment. Then, there is a second concern, which is related to the amount of risk involved with the investment. When the risks are too high, investors are more likely to lose their initial investment (in parts or completely), which would result in a negative ROI.
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What is Public Key Cryptography?

What is Public Key Cryptography?
Public key cryptography (PKC), also known as asymmetric cryptography, is a framework that uses both a private and a public key, as opposed to the single key used in symmetric cryptography. The use of key pairs gives PKC a unique set of characteristics and capabilities that can be utilized to solve challenges inherent in other cryptographic techniques. This form of cryptography has become an important element of modern computer security, as well as a critical component of the growing cryptocurrency ecosystem.
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History of Cryptography

History of Cryptography
Cryptography, the science of writing codes and ciphers for secure communication, is one of the most important elements that goes into making modern cryptocurrencies and blockchains possible. The cryptographic techniques used today, however, are the result of an incredibly long history of development. Since ancient times, people have used cryptography to transmit information in a secure manner. Following is the fascinating history of cryptography that has led up to the advanced and sophisticated methods used for modern digital encryption.
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What Is Axie Infinity (AXS)?

What Is Axie Infinity (AXS)?
It’s 2021, and that means you can earn money by playing games and breeding virtual pets. An easy way to think of Axie Infinity is to imagine a blockchain game that combines Pokémon, CryptoKitties, and card game elements.
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Is Bitcoin a Store of Value?

When you think of a safe-haven asset, precious metals like gold or silver probably come to mind. They’re investments that individuals flock to as hedges against turmoil in traditional markets. The debate over whether Bitcoin follows in the footsteps of these assets rages on. In this article, we’ll look at some of the main arguments for and against Bitcoin being a store of value.
When you think of a safe-haven asset, precious metals like gold or silver probably come to mind. They’re investments that individuals flock to as hedges against turmoil in traditional markets. The debate over whether Bitcoin follows in the footsteps of these assets rages on. In this article, we’ll look at some of the main arguments for and against Bitcoin being a store of value.
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Приготовьтесь! Биткойн будут сливать, но это не точно

Приготовьтесь! Биткойн будут сливать, но это не точно
Только что в Twitter наткнулся на пост от Jacob Canfield, якобы есть инсайдерская информация, о том что Bitcoin планируют сливать, дабы выбить некоторых конкурентов, потом обратно откупить, подняв стоимость до $70к.
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What Is The Sandbox (SAND)?

What Is The Sandbox (SAND)?
The Sandbox is a play-to-earn game that combines blockchain technology, DeFi, and NFTs in a 3D metaverse. Its virtual world allows players to create and customize their games and digital assets with free design tools. The virtual goods created can then be monetized as NFTs and sold for SAND tokens on The Sandbox Marketplace.
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What Is VeChain (VET)?

What Is VeChain (VET)?
VeChain provides blockchain solutions for businesses around the globe. With plenty of existing industry blockchain applications from supply chain management to anti-counterfeiting and carbon credits, their systems have been proven in the real world. VET is the coin that underpins VeChain, where VTHO is the gas token that’s used for transactions on the VeChainThor blockchain (like Ethereum’s gas).
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More about the Crypto Fans club

More about the Crypto Fans club
Now I will tell you what our club is, how it works and what advantages it has. A minimum of water, a maximum of specifics. The club is a kind of trust fund, which consists of a team of Asset Managers, on the one hand, who invest in the crypto market, and Investors, on the other. I will not describe in this article what cryptocurrency is, why it is growing, and what are its advantages, this topic is worthy of a separate article. You can google all this, or go to coinmarketcap.com and see how the value of a particular cryptocurrency has grown at least this year, and doubts about investing in cryptocurrency should disappear.
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What Is Tether (USDT)?

What Is Tether (USDT)?
Tether (USDT) is one of the most popular stablecoins out there. It was designed to hold a one-to-one value with the US dollar. The coin exists on many different blockchains and has experienced rising trading volumes and improved liquidity over the past few years.
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What Is Solana (SOL)?

What Is Solana (SOL)?
Solana is a blockchain network focused on fast transactions and high throughput. It uses a unique method of ordering transactions to improve its speed. Users can pay their transaction fees and interact with smart contracts with SOL, the network’s native cryptocurrency.
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What Is Ethereum 2.0 And Why Does It Matter?

What Is Ethereum 2.0 And Why Does It Matter?
Ethereum 2.0 is a long-awaited upgrade to the Ethereum (ETH) network that’s promised significant improvements to the functionality and experience of the network as a whole. Some of the more notable upgrades include a shift to Proof of Stake (PoS), shard chains, and a new blockchain at the core called the beacon chain. All of this and more is expected to be phased in through a carefully planned roadmap.
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What Is Polkadot (DOT)?

What Is Polkadot (DOT)?
Polkadot positions itself as the next-generation blockchain protocol, capable of connecting multiple specialized chains into one universal network. With a strong focus on building infrastructure for Web 3.0 – and founded by the Web3 Foundation – Polkadot aims to disrupt Internet monopolies and empower individual users.
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What Is Harmony (ONE)?

What Is Harmony (ONE)?
Harmony is a layer-1 blockchain using sharding and Effective Proof of Stake to achieve scalability, security, and decentralization. The network was launched in 2019 and features trustless cross-chain bridges and four shards, which process transactions in parallel. Effective Proof of Stake encourages decentralization of validators, and sharding shares the network's load among validators, delegators, and users.
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What Is Decentraland (MANA)?

What Is Decentraland (MANA)?
Decentraland is a virtual world and community based on blockchain technology. Users develop and own plots of land, artwork, and Non-Fungible Tokens (NFT). Members also participate in the platform’s Decentralized Autonomous Organization (DAO).
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What Is BUSD?

What Is BUSD?
BUSD is a regulated, fiat-backed stablecoin pegged to the U.S. dollar. For every unit of BUSD, there is one U.S. dollar held in reserve. In other words, the supply of BUSD is pegged to the U.S. dollar at a 1:1 ratio. Holders can swap their tokens for fiat and vice versa. Paxos, the token’s issuer, releases monthly attestations of BUSD’s reserves.
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What Is Filecoin (FIL)?

What Is Filecoin (FIL)?
FFilecoin is a decentralized, peer-to-peer digital storage marketplace using blockchain technology. It’s built on top of InterPlanetary File System (IPFS) and allows users to rent unused hard disk space and earn FIL tokens in return. Let’s see how Filecoin aims to shake up the online storage space.
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What Is Avalanche (AVAX)?

What Is Avalanche (AVAX)?
Avalanche attempts to improve scalability without compromising speed or decentralization. Three blockchains make up its core platform - the Exchange Chain (X-Chain), Contract Chain (C-Chain), and Platform Chain (P-Chain). The X-Chain is used for creating and trading assets. The C-Chain is for smart contract creation. The P-Chain is for coordinating validators and Subnets.
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What Is a Stablecoin?

What Is a Stablecoin?
A stablecoin is a cryptoasset pegged to another asset, such as fiat currencies or precious metals. Stablecoins are designed to maintain a relatively stable price so that users can avoid the volatility risks common in the crypto markets.
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What Are Wrapped Tokens?

What Are Wrapped Tokens?
A wrapped token is a cryptocurrency token pegged to the value of another crypto. It’s called a wrapped token because the original asset is put in a wrapper, a kind of digital vault that allows the wrapped version to be created on another blockchain.
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Tokenized Bitcoin on Ethereum Explained

Tokenized Bitcoin on Ethereum Explained
Tokenized Bitcoin is a way to use bitcoin on other blockchains. But wait, isn’t Bitcoin great already? Indeed it is! It has a solid use case, and it already acts as a kind of public good. At the same time, its purposely limited features leave little room for further innovation.
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