The biggest disappointment of encryption and blockchain in 2021

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In terms of adoption rate and mainstream acceptance, 2021 is one of the most interesting years for blockchain technology and cryptocurrency.From the government, for example Savior For a big company like this Tesla, Goldman Sachs, Bank of America and Morgan Stanley, Many institutions have taken a step towards becoming part of the ecosystem.

Even so, there are still some problems and incidents that worsen the mood of cryptocurrency investors and the entire community.

SEC rejects VanEck’s spot Bitcoin ETF

ProShares’ Bitcoin approved by the U.S. Securities and Exchange Commission (Bitcoin) Futures exchange-traded funds in early October, according to Cointelegraph Markets Pro. ProShares Bitcoin Strategy ETF traded under the ticker symbol BITO owns The biggest first day ever The natural trading volume of any ETF shows how much people are looking forward to the launch of the BTC ETF.

Soon after, on November 12th, financial regulators disrupted the gathering in the following ways Reject Van Eyck’s proposal For spot Bitcoin ETFs, this caused the price of flagship cryptocurrencies to begin a downward spiral.

VanEck CEO Jan van Eck was not satisfied with the rejection.

Since Cameron and Tyler Winklevoss attempted to launch the “Winklevoss Bitcoin Trust” in July 2013, the effort to obtain SEC approval for a spot ETF has been going on for more than eight years. Despite the passage of such a long time and changes in the narrative surrounding cryptocurrencies, Gary Gensler’s SEC has not yet approved a spot ETF for Bitcoin.

related: VanEck’s Bitcoin spot ETF diversion strengthens the SEC’s prospects for cryptocurrencies

Bloomberg senior ETF analyst Eric Balchunas expressed his views on the SEC’s refusal. Balchunas has been commenting on the SEC’s rejection of several spot ETF applications that have already been submitted. He has become one of the important voices tracking the development of new ETFs around cryptocurrencies such as Bitcoin and Ethereum.Ethereum).

Ethereum network: Gas fees are out of control

The Ethereum network has undergone a milestone upgrade in 2021: its London hard fork, This puts ETH on a deflationary track With the Ethereum Improvement Proposal (EIP) 1559. As of this writing, there are 1.244 million ETH burn, Valued at more than 4.96 billion US dollars.

With the introduction of the burning mechanism, Ethereum gasoline fees have also surged In view of the increase in the use of decentralized finance (DeFi) protocols on the blockchain and the proliferation of non-fungible tokens (NFT) based on Ethereum in the crypto world. Gas costs continue to exceed 100 gwei, even in 2022. “Gwei” is the smallest unit of Ether, equal to 0.000000001 ETH.

gas cost On February 23, the price of Bitcoin on the Internet reached an annual high of 373.8 gwei. Although gas costs seemed to be under control between May and August, there have been several very unfavorable peaks since then, especially for retail investors in the DeFi market. This has also led to multiple DeFi agreements and investors choosing to replace blockchain networks, such as Binance Smart Chain, Solana, Polygon, etc.

In order to solve this persistent problem, Ethereum co-founder Vitalik Buterin has suggestion Upgrade EIP 4448 and EIP 4490, which will use a method called data fragmentation as a temporary repair, which will reduce the cost of zk-Rollups on the blockchain.

However, it remains to be seen whether the proposal will pass the governance structure of the network and the actual effect of these upgrades in reducing natural gas costs.

related: London’s influence: Ethereum 2.0’s staking contract becomes the largest ETH holder

Solana Network: Outages and DDoS Attacks

Solana was launched in April 2019 and has rapidly developed into one of the leading blockchain networks, with a total value lock (TVL) close to US$12 billion. The native token of the network, Sol, Given the current price of approximately US$180, the price has increased nearly 130 times. The token hit an all-time high of $260.06 on November 7.

However, at 13:46 PM UTC on December 4th, Solana network outage It lasted nearly six hours. The mainnet beta cluster of the network stopped producing blocks at slot 53,180,900, which prevented the confirmation of new transactions on the blockchain. The outage drew criticism from various traders and developers, who criticized the network on Twitter.

Scott Lewis, co-founder of DeFi Pulse, was one of the critics, citing Serum’s order data as evidence of the lack of “real customer orders.”

This is not the first power outage Solana has experienced this year. As early as September, Network outage for 17 hours Between September 14 and 15, due to a distributed denial of service (DDoS) attack on Grape Protocol’s initial decentralized exchange product on September 14. During a DDoS attack, a large number of coordinated devices or botnets congested the network with fake traffic and tried to take it offline.

Soon after the second power outage on December 4, Another DDoS attack on the network On December 9, the network was temporarily congested, although it managed to stay online throughout the attack.

related: Scalability or stability? Solana network outage indicates work is still needed

Although this attack was blamed on Solana’s basic design and use of its historically proven consensus mechanism, the developers still seem to believe in the potential of the network. Solana co-founder Raj Gokal elaborated on the DDoS attack on Twitter:

After the DDoS attack, Solana’s Significant increase in on-chain development work In terms of daily GitHub submissions. In fact, the network surpassed Polkadot and Cardano between November 12 and December 13, becoming the most developed blockchain network.

Binance Smart Chain Network: Security Vulnerabilities

Binance Smart Chain is a parallel chain of Binance Chain. Both blockchains are designed and maintained by Binance, a cryptocurrency exchange. BSC made its debut in April 2020 and will soon be launched in August 2020.

Since then, the network has developed into the second most widely used blockchain to deploy decentralized applications after Ethereum. According to DefiLlama, the TVL in the current DeFi protocol on the network Standing Nearly 17 billion U.S. dollars. TVL hit a record high of US$31.72 billion on May 10, which was the peak of the previous bull market in the market.

However, since its introduction, the network and the protocols running on it have been extremely vulnerable to security vulnerabilities. The following is a list of some DeFi protocols on BSC that have become victims of security vulnerabilities and hacker attacks:

Considering that the above list is not exhaustive in nature, it can be said with certainty that within 18 months of network operation, hacker attacks and security breaches have caused hundreds of millions of dollars in losses.In addition to these security vulnerabilities, there are Multiple phishing attacks On the PancakeSwap decentralized exchange and Cream Finance.

related: With the increase in TVL and transaction volume, the number of DeFi hackers on the Binance smart chain has increased

However, the Binance ecosystem is trying to solve this problem in a variety of ways. The latest effort is the introduction of Project Shield, a security audit program that will add an extra layer of protection to users trying to access BEP-20 and ERC-20 tokens on the Binance exchange.

There is a lot to look forward to

Although these conditions and issues have caused disappointment in the crypto community in 2021, it is clear that the growth of digital currency usage is higher than ever.

With innovations such as NFT, GameFi, and Metaverse, the cryptocurrency field is using an innovation to make these industries better and enter the next big thing in art, games, music, and finance.