Blockchain
WOOTRADE Dark Pool Solves Liquidity Pain Points within Crypto Ecosystem
Cryptocurrency and blockchain have been around for more than 10 years, as new technology, concepts and models continue to be developed and reconstructed. However, the most prominent, and perhaps most important application, is still in “Trading”. Because most retail customers cannot directly invest in primary markets, they turn to secondary markets, known as crypto exchanges.
For many exchanges, trading volume is a very simple performance indicator, because volume not only directly correlates to profit, but is also a marketing tactic to attract retail customers. Newer exchanges tend to fall into the trap of forging their trading volume to raise their market ranking and increase brand exposure. Many people think that an exchange with a large trading volume will attract more avid traders because they will have better market depth and liquidity, but that’s far from the truth.
If cryptocurrency aims to become a mainstream investment tool, liquidity is a key issue that needs to be addressed, aside from regulations, safety concerns and new models. Once the liquidity problem is solved, the whole digital asset ecosystem, especially exchanges, can progress rapidly.
The Problem with Depth and Liquidity in the Crypto Market
So, what is liquidity? To use an easier but maybe less accurate definition, liquidity reflects the market’s transaction scale. When you make a transaction on an exchange and open a sell order, you will notice that your pending order will be displayed on the exchange’s order book. This order book is a compilation of every customer’s order. When a bid is opened, it will be matched with an ask based on price. Of course, it’s much more complicated than this, but basically, the compilation of buy and sell orders (also referred to as depth) accurately represents the liquidity that customers care about.
The problem is, when a whale submits an ask of 100 BTC, small exchanges do not have the capacity to handle an order this size. This causes a drastic price fluctuation, such as a 5% slippage between the average strike price and market price. Versus when you submit an order on a big exchange, the slippage may only be around 1% or less. For example, in July, an ask of over 6000 BTC was opened on Binance, the market price only dropped around USD $300 after all BTC were sold. If we use the price of USD $10000/BTC to calculate, the slippage is only 3%, which shows that Binance has high liquidity. When we look at the secondary market however, there is an inconsistency with depth and liquidity among exchanges.
Another Solution: Aggregation Platforms and Dark Pools
The liquidity and market depth problem pushed forward the development of aggregation platforms, which combine the market depth of various large exchanges. When customers use these types of trading platforms, they receive the combined depth of these exchanges, which have more liquidity and a deeper order book than a single exchange has alone. However, these platforms often charge a high fee for their services.
Besides aggregated market platforms, there may be another solution, but first, we have to introduce another concept: Dark Pool. A dark pool allows large anonymous transactions to happen outside of the public market. Simply put, we can think of a dark pool as a trading platform made from a huge order book with high liquidity. Once clients connect to this dark pool, they can utilize a deeper order book, without worrying that their order will cause a big slippage. Transactions will also be made at a reasonable price, and not affected by poor liquidity.
Recently, a similar project, WOOTRADE launched during Shanghai blockchain week, held by Wanxiang Blockchain Labs. WOOTRADE, incubated by Kronos Research quantitative fund, focuses on providing a liquidity service, or more so a market depth service. WOOTRADE not only aggregates depth from larger exchanges, they also incorporate Kronos’s HFT liquidity flow, thus providing a deeper order book with a more competitive pricing.
WOOTRADE’s capability of providing such services largely correlates with the success of Kronos Research’s fund services. Kronos’s Co-Founder Mark Pimentel, graduated from CMU, started his career at Citadel Investment Group, and continued on at Knight Capital’s electronic market making group. His team operated the largest dark pool in the US and Europe during the time. Based on the solid background of their founders, Kronos effectively uses HFT and CTA strategies in their fund. Kronos’s high transaction volume and flow also acts as one of WOOTRADE dark pool’s liquidity provider. In addition, since Kronos is a quantitative fund, they are able to take more risks than traditional market makers can.
Kronos’s Co-founder Jack Tan says, “As a quant fund, Kronos has a very strong partnership with many of the largest digital asset exchanges, and our huge transaction volume is the key to our profits. From a market standpoint, exchanges, wallets, OTCs, large traders, and even other quant teams, have all expressed a need for this liquidity service. We trade over millions of BTC per month, and that volume is added into WOOTRADE, and provided for every connected exchange. We also aim to work with DEX and other decentralized projects to realize a totally fair and transparent ecosystem in the near future.”
Blockchain
Glidelogic Corp. Announces Revolutionary AI-Generated Content Copyright Protection Solution
Blockchain
Ethereum ETFs Aren’t Blockchain But Is A Revolutionary Tech: Top 6 Amazing Reasons To Invest In Them
The financial landscape is rapidly evolving, with the integration of blockchain technology and cryptocurrencies becoming more prominent. Among these, Ethereum ETFs (Exchange-Traded Funds) have emerged as a significant investment vehicle, offering exposure to the Ethereum blockchain’s native cryptocurrency, Ether (ETH), without requiring direct ownership. However, it’s crucial to understand that Ethereum ETFs are distinct from the blockchain itself and serve different purposes in the investment world.
Understanding Ethereum and ETFs
Ethereum: A decentralized platform that enables the creation and execution of smart contracts and decentralized applications (dApps). It operates using its cryptocurrency, Ether (ETH), which fuels the network.
ETF (Exchange-Traded Fund): A type of investment fund that holds a collection of assets and is traded on stock exchanges. ETFs can include various asset classes, such as stocks, commodities, or bonds.
Ethereum ETFs: The Intersection of Traditional Finance and Cryptocurrency
An Ethereum ETF provides a way for investors to gain exposure to the price movements of Ether without directly purchasing the cryptocurrency. This is achieved through an ETF structure, where the fund holds assets linked to the value of Ether, and investors can buy shares of the ETF on traditional stock exchanges.
Key Features of Ethereum ETFs:
- Indirect Exposure: Investors gain exposure to Ether’s price changes without needing to manage or store the cryptocurrency themselves.
- Regulatory Compliance: Unlike the relatively unregulated cryptocurrency market, ETFs operate under the oversight of financial regulators, offering a layer of investor protection.
- Accessibility: Ethereum ETFs are available through traditional brokerage platforms, making them accessible to a broader range of investors.
Why Invest in an Ethereum ETF?
- Diversification: Including an Ethereum ETF in a portfolio can provide exposure to the cryptocurrency market, potentially enhancing diversification beyond traditional assets.
- Convenience and Familiarity: ETFs are a familiar investment product, simplifying the process of investing in cryptocurrencies.
- Professional Management: ETF managers handle the investment decisions, including the buying and selling of assets, which can be advantageous for those less familiar with the cryptocurrency space.
- Regulatory Oversight: ETFs are subject to regulatory scrutiny, potentially offering more safety and transparency compared to direct cryptocurrency investments.
- Potential for Growth: As the cryptocurrency market grows, ETFs linked to assets like Ether may benefit from rising prices.
Key Differences Between Ethereum and Ethereum ETFs
While both are related to the Ethereum blockchain, Ethereum itself and Ethereum ETFs represent different forms of investment:
- Ethereum (ETH):
- Direct ownership of the cryptocurrency.
- Full exposure to Ethereum’s features, including staking and network participation.
- Traded on cryptocurrency exchanges.
- Highly volatile and largely unregulated.
- Ethereum ETF:
- Indirect exposure through shares representing Ether’s value.
- Traded on traditional stock exchanges under regulatory oversight.
- Offers a more stable and familiar investment structure.
- Typically lower volatility compared to direct cryptocurrency ownership.
Future Considerations for Ethereum ETFs
The approval and launch of Ethereum ETFs mark a significant milestone in bringing cryptocurrencies closer to mainstream finance. They offer a convenient and regulated means for investors to gain exposure to the growing digital assets market. However, they also come with limitations, such as not allowing direct participation in the Ethereum ecosystem’s innovations, like dApps and smart contracts.
As the market evolves, we may see more sophisticated financial products that better capture the full potential of the Ethereum ecosystem. For now, Ethereum ETFs provide a balanced option for those interested in cryptocurrency exposure within the framework of traditional finance.
In conclusion, while Ethereum ETFs offer a gateway into the world of digital assets, they should be viewed as complementary to, rather than a replacement for, direct investment in the underlying blockchain technologies. Investors should carefully consider their investment goals, risk tolerance, and the unique attributes of both Ethereum and Ethereum ETFs when making investment decisions.
Source: blockchainmagazine.net
The post Ethereum ETFs Aren’t Blockchain But Is A Revolutionary Tech: Top 6 Amazing Reasons To Invest In Them appeared first on HIPTHER Alerts.
Nexo, a leading institution in the digital assets industry, has reinforced its commitment to data security by renewing its SOC 2 Type 2 audit and attaining a new SOC 3 Type 2 assessment without any exceptions. This rigorous audit process, conducted by A-LIGN, a respected independent auditor specializing in security compliance, confirms Nexo’s adherence to stringent Trust Service Criteria for Security and Confidentiality.
Key Achievements and Certifications
- SOC 2 and SOC 3 Compliance:
- SOC 2 Type 2: This audit evaluates and reports on the effectiveness of an organization’s controls over data security, particularly focusing on the confidentiality, integrity, and availability of systems and data.
- SOC 3 Type 2: This public-facing report provides a summary of SOC 2 findings, offering assurance to customers and stakeholders about the robustness of Nexo’s data security practices.
- Additional Trust Service Criteria:
- Nexo expanded the scope of these audits to include Confidentiality, showcasing a deep commitment to protecting user data.
- Security Certifications:
- The company also adheres to the CCSS Level 3 Cryptocurrency Security Standard, and holds ISO 27001, ISO 27017, and ISO 27018 certifications, awarded by RINA. These certifications are benchmarks for security management and data privacy.
- CSA STAR Level 1 Certification:
- This certification demonstrates Nexo’s adherence to best practices in cloud security, further solidifying its position as a trusted partner in the digital assets sector.
Impact on Customers and Industry Standards
Nexo’s rigorous approach to data protection and compliance sets a high standard in the digital assets industry. By achieving these certifications, Nexo provides its over 7 million users across more than 200 jurisdictions with confidence in the security of their data. These achievements not only emphasize the company’s dedication to maintaining top-tier security standards but also highlight its proactive stance in fostering trust and transparency in digital asset management.
Nexo’s Broader Mission
As a premier institution for digital assets, Nexo offers a comprehensive suite of services, including advanced trading solutions, liquidity aggregation, and tax-efficient credit lines backed by digital assets. Since its inception, the company has processed over $130 billion, showcasing its significant impact and reliability in the global market.
In summary, Nexo’s successful completion of SOC 2 and SOC 3 audits, along with its comprehensive suite of certifications, underscores its commitment to the highest standards of data security and operational integrity. This dedication positions Nexo as a leader in the digital assets space, offering unparalleled security and peace of mind to its users.
Source: blockchainreporter.net
The post Nexo Reaffirms Commitment to Data Protection with SOC 3 and SOC 2 Compliance appeared first on HIPTHER Alerts.
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