The week of 08/02 at a glance – News about Bitcoin and crypto-currencies is in constant turmoil. It can happen that crucial information gets lost in the daily news flow and you miss the important points.
This format is here to help. We look back on last week’s news in Crypto Weekly to keep you informed about the current state of cryptomoney.
The unmistakable of the corner
For this week’s must-read, we’re going to look at an article I had the pleasure of writing. As Ethereum struggles with ever-increasing transaction costs, second layer solutions such as Optimism are looking to solve scalability problems. Let’s see what Optimism is all about.
As it stands, the Ethereum network has a processing capacity of about 30 transactions per second. Although its characteristics have allowed it to evolve so far, the limits of the network have been constantly reached since the beginning of 2020.
In practice, the network has consistently exceeded 90% utilisation since April 2020. At the time of writing, this level has steadily increased to 97.8%. As a reminder, network usage is calculated on the basis of the average gas consumed, compared to the maximum gas limit set by the protocol.
As a result of this high usage, network transaction costs exploded, eventually reaching a record average of $17.5. Worse still, some interactions with decentralized applications can cost tens of dollars.
The second layer to the rescue
As it stands, the majority of the traffic recorded by Ethereum, as well as a large part of its decentralised applications, takes place on layer 1, i.e. the Ethereum blockchain.
Consequently, the vast majority of the actions carried out on Ethereum draw on the limited capacity of the network.
As for the second layer solutions, they aim at shifting part of the activity out of the main chain. Nevertheless, these solutions rely on the main chain to ensure better security.
Optimism is a project initiated in June 2019, which takes advantage of Rollups to offer a second layer solution to the Ethereum network. In theory, this solution would be able to process more than 20,000 transactions per second.
It therefore provides near-instantaneous transactions, smart contracts and, all this without the need for gas.
The project is led by the Optimism Public Benefit Corporation, founded by Jinglan Wang.
The protocol made headlines in September 2020 with the launch of a testnet on Ethereum. Based on this success, the protocol was finally deployed on the mainnet on January 15, 2021.
Feel free to read the full article to discover how Optimism works: Ethereum, a revolution to be consolidated: the Optimism solution
News in brief
▶ Does a small handful of users really control the majority of Bitcoins? This theory, although widespread, is not really accurate. Let’s take stock, in nuances!
▶ The Central Bank of Nigeria wants to ban Bitcoin. This potential ban is a blow to local players, given that Nigeria is the second largest BTC market in the world.
▶ Avalanche deploys a bridge to Ethereum. As a result, it will now be possible to transit ERC-20 tokens to Avalanche. At the same time, the teams have just unveiled the launch of Pangolin, a DEX hosted on Avalanche.
▶ The WEC has finally launched the futures contracts on Ethereum. The first day proved to be a success, with 388 contracts subscribed.
▶ Mastercard is going to add cryptocurrencies to its network. Thus, the group is preparing to allow the use of stablecoins, starting in 2021.
▶ New episode of Crypto Vision, co-hosted by Benoit and Sami, with the famous CryptoMatrix!
The 5 metrics of the week
➤ 277 billion dollars is the insane volume recorded by PayPal on its cryptomoney sales service over the last 3 months.
➤ 38,000 % is the evolution of the number of BTCs tokenized on Ethereum since January 2020. In practice, Ethereum currently hosts more than 167,000 BTCs.
➤ $1.5 billion is the amount Tesla spends on Bitcoin. At the same time, the company is even considering the possibility of accepting payments in BTC.
➤ 19 billion dollars is the amount of transfers made to Ethereum on February 4th. This is more than the value that passed through Bitcoin, which reached « only » 11 billion dollars.
➤ 165,861 million TH/s is the new hashrate record recorded by the Bitcoin network. In practice, it has more than doubled since January 2020.
Tweet of the week
This week’s tweet goes to Gregory Raymond and his comparison between the performance of centralized exchange platform tokens and decentralized platforms.
The breakthrough of centralized exchange platform tokens in 2021
👉 $BNB – 230%👉 $FTT – 226%👉 $CHSB – 232
The governance tokens of the main decentralized exchanges
👉 $UNI – 379%👉 $SUSHI – 391%👉 $CAKE – 712%👉
Have a good week on the Journal du Coin! 🙂