Coinbase will allow U.S. retail customers to borrow fiat loans against as much as 30% of their bitcoin holdings. One of the largest and most regulated crypto exchanges is capping credit lines at $20,000 per customer and offering an interest rate of 8% for bitcoin-backed loans with terms of one year or less.
Yam, a DeFi token, suffered a fatal Code flaw which saw about $750,000 worth of tokens get locked up permanently and irretrievably. The project launched on Tuesday and had already accumulated over half a billion Dollars in value by Thursday. A report on DeFi revealed that over $25 million had been hacked or otherwise lost in the space in the second quarter of 2020.
BitMEX announced that users will have to provide their personal identification details over the next 6 months to continue using the exchange. The verification process will open on the 28th of this month when further information on the details required will also be provided.
The surging popularity of Decentralized Finance, or DeFi projects is consuming a lot of Ethereum’s blockchain resources. The average Ethereum transaction fee hit over $6, surpassing the previous high set in mid-2018. Uniswap, Tether, and Forsage combined for over 30% of total gas usage by the end of the week.
MicroStrategy has become the first NASDAQ-listed company to include Bitcoin as part of its asset allocation strategy. It supposedly invested $250 million in the cryptocurrency as a hedge against inflation. This step underlines the growing interest in cryptocurrency by institutional investors this year.
Before we conclude, this week’s “Bitcoin quick question” is why are there so many cryptocurrencies?
In 2011, 2 years after Bitcoin’s creation, other cryptocurrencies began to appear. Entrepreneurs and developers realized that blockchain, the technology that Bitcoin relies on, can be used for additional purposes as well. At first, most of the newly created cryptocurrencies were aiming to compete with Bitcoin on becoming the global peer-to-peer electronic cash system, such as Litecoin. Later on however, additional uses for the technology were introduced, and that brought on an enormous wave of newly created tokens.
You see, Bitcoin’s blockchain is effectively an immutable accounting ledger. Entrepreneurs realized that just like we are able to write financial transactions in it, we can also attempt to write other types of assets.
It also introduced new abilities to incentivize participants in other peer-to-peer networks, like file sharing systems, and even led to the creation of a whole new financial system – the decentralized finance. If you want to learn more about altcoins and what the best Bitcoin alternatives are, visit the link in the description below.
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That’s what’s happened this week in Bitcoin. See you next week.