5 Things Blockchain You Need to Know for September 12, 2022
Sanctioning Open Source Technology May Stifle Web3 Innovation
TLDR: Lawmakers are pressuring web3 developers to be more accountable for problems that may arise outside of their control. This fear and uncertainty among developers is stifling innovation.
Coinbase has agreed to pay some of the legal costs for six individuals who were affected by US sanctions on Tornado Cash. This is in a lawsuit filed against the Treasury Department’s Office of Foreign Assets Control (OFAC), an agency within our government. Cryptocurrency mixers such as Tornado Cash give users the ability to deposit assets from a crypto address and withdraw them using a different address while maintaining privacy. The Treasury claims that a North Korean state-sponsored hacking group has utilized Tornado Cash to clean more than $7 billion worth of digital currencies
If you have been keeping up with my thoughts on Web3, then you know that I have constantly advocated for careful regulations in the Web3 space. We believe that reasonable regulations are prerequisite for the widespread adoption of this emerging industry. However, sanctions like these end up punishing people who had nothing to do with the problem. This makes people have less privacy and security. Coinbase CEO Brian Armstrong wrote, and we concur, that sanctioning open source software is similar to shutting down a highway that robbers used to flee a crime scene.
Web3 Developers, including those here at VezTek, are concerned about being held accountable for issues outside of their control. If we want to see innovation, then this is not the way to go about it. Rules like these make the developers wonder whether they’re putting themselves at risk by pushing the technology forward.
White House Criticizes Proof-of-work Crypto Mining
TLDR: The Proof of Stake (PoS) consensus mechanism could help alleviate some of the climate-driven weather extremes and surging power prices.
Some crypto-asset technologies can be very energy-intensive, accounting for a significant amount of greenhouse emissions, pollution, noise, and other local problems. According to one report for August 2022, crypto asset mining consumed more electricity than Argentina and Australia used in an entire year. Given the electricity usage estimates, most discussions about crypto-asset energy consumption have focused on PoW (Proof of Work) applications, particularly Bitcoin, which presently accounts for more than 60% of the entire cryptocurrency market capitalization. If energy consumption rates stay this high, many American citizens may suffer from drastic consequences. Not only would the climate worsen, but it also could jeopardize the stability of electricity networks as it would push up power costs for local consumers.
Concerned about the potentially severe consequences, the White House has urged the Environmental Protection Agency (EPA) and Department of Energy (DOE) to take concrete steps to minimize energy usage in proof-of-work crypto mining. The Proof of Stake (PoS) consensus mechanism, which is far less energy-intensive and estimated to consume only 0.001% of global electricity usage, could be a better alternative to PoW. Due to the reduced energy consumption, Proof-of-Stake does not require mining hardware to validate blocks, resulting in a significant reduction in energy usage. The amount of carbon released into the environment as a result of less energy being consumed will be lower as fewer fossil fuels will be burned. Moving forward, digital asset development must take into account solutions for drastically lowering energy usage.
Layer 2 Platforms to Tackle High Transaction Fees In the Blockchain Ecosystem
TLDR: The high costs of gas fees can be a real pain, but Layer 2 solutions are here to help.
During periods of high demand, high transaction fees have plagued users on well-known blockchain networks like Ethereum and Bitcoin. However, in response to this problem, various solutions have emerged, with Layer 2 technologies being the most popular choice.
Layer-2 platforms are essentially networks that run in parallel to the main blockchain, or layer 1. L2s take a portion of the transactions and validate them off-chain, preventing congestion on the main network and keeping transaction fees low while maintaining high speeds. Rollups (zk-Rollups), an off-chain protocol that runs on top of the Ethereum blockchain and is governed by on-chain smart contracts, is a popular Layer 2 solution for expensive transaction fees. It works by consolidating multiple transactions from the main chain into a single one. The single transaction then is verified and the proof is sent back to the main chain. Because of the less stress on the network, Zk-Rollups allow the Ethereum blockchain to have lower transaction costs, increased transaction capacity, and quicker transaction times. After exploring multiple solutions to high transaction fees, our Web3 engineers at VezTek USA have found that Layer2 technologies show the most promise.
Late Queen Elizabeth II Sparks Influx of Meme Coins and NFTs
TLDR: No time wasted! The demand for non-fungible tokens (NFTs) linked to the late Queen Elizabeth increased alongside the prices.
On Friday, Buckingham Palace announced the death of Queen Elizabeth II. While Her Majesty’s passing has elicited a flood of condolences and sympathies from all over the globe, it has also been taken advantage of as a money-making opportunity. People, never ones to skip a chance to profit off of the public attention, flocked to online marketplaces with more than 40 crypto coins and NFTs in the hours following the monarch’s passing. Most of the projects, on the other hand, offer little liquidity, which might be an indication of a future pump and dump scheme. The crypto community, known for its dark humor, mostly reacted negatively to the projects.
Queen Elizabeth II set a record at 96 years old as the longest-reigning head of state in modern history, although it’s doubtful that the digital assets she inspired will last nearly as long.
The Blockchain Potential in the Midstream Oil and Gas Industry
TLDR: The application of blockchain technology in the midstream oil and gas industry could potentially reduce cash cycle time, and make operations more secure.
Blockchain technology is expected to establish the foundations for economic and financial systems in a way that will revolutionize business models and organizational structures. It has opened a world of possibilities for blockchain-based innovative solutions that have been expanded to the midstream Oil and Gas sector. With the world increasingly shifting to digital means, information and communication technology is becoming more important in the oil and gas industry to support difficulties such as decarbonization, decentralization, digitalization, and security. The implementation of blockchain technology will increase security, and reduce cash cycle time in the industry.
The energy sector is often associated with cash-cycle time and working capital shortages. This is due to the fact that its natural resources travel through a supply chain swiftly, taking advantage of their value only after they are extracted, processed, and sold. The oil and gas industry’s unique difficulty is worsened by a worldwide market that requires transactions to be done in the same currency across the globe. Blockchain technology may help to speed up the time it takes to settle transactions in the oil and gas sector by eliminating the need for third-party payment platforms to authenticate a transaction before it can be recorded in the database. With blockchain, transactions are quickly verified at each stage, lessening the amount of time it takes for them to be completed
𝟓 𝐓𝐡𝐢𝐧𝐠𝐬 𝐁𝐥𝐨𝐜𝐤𝐜𝐡𝐚𝐢𝐧 𝐘𝐨𝐮 𝐍𝐞𝐞𝐝 𝐭𝐨 𝐊𝐧𝐨𝐰 𝐟𝐨𝐫 September 12, including, Sanctioning Open Source Technology May Stifle Web3 Innovation
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