Cryptocurrency has become highly sought after by aggressive traders due to its highly volatile nature compared to the stock and foreign exchange markets. But trading cryptos can be tricky, and because the tax laws are complex and often changing, it's easy to make mistakes without realizing it.

Top 7 Mistakes to Avoid in Crypto Taxation

Let's chat about the most common errors traders and investors make when filing their crypto taxes and how to dodge them. From overlooking capital gains to missing reporting transactions, the 7 most common missteps are covered here to ensure you get your crypto taxes right.

Not Filing Crypto Tax

Failing to report your cryptocurrency taxes is a big mistake. In nations with more developed tax laws for digital assets, like the US, Germany, or Australia, trading cryptocurrencies and earning money from digital assets are taxable.

What happens if you don't report your crypto taxes? You could face audits, fines, and notices demanding payment of taxes owed. Therefore, it's essential to keep track of your trades throughout the year, calculate your gains and losses, and fill out the correct tax forms by the due date.

Not Tracking Trading History

Not reporting your transactions from the start could create a few headaches when it comes to cryptocurrency taxes. To accurately calculate your gains or losses from the sale, you must consider past years' transactions when you file your taxes. This will then show how much cryptocurrency tax is due.

You can take the services of any well-known crypto bookkeeping and accounting services to keep track of all your trades. Alternatively, cryptocurrency tax software or crypto tax advisers can make your life easy.

Not Harvesting Tax Loss

It's not uncommon for positions in the crypto market to experience substantial losses before eventually turning a profit, owing to its high volatility. Fortunately, crypto traders can utilize tax-loss harvesting to lower their tax liabilities. However, lower volatility and the Wash Sale Rule make it challenging to employ tax-loss harvesting.

Exploring tax-loss harvesting opportunities in your portfolio can be simplified by using an automatic tool that gathers unrealized losses from multiple exchanges and wallets based on accounting practices. It would also be wise to consult with an expert.

Not Recording Separate Crypto

Figuring out which cryptocurrencies are used for trading profits and which you receive as income is critical for filing your taxes correctly. Accepting cryptocurrencies as payment for work or services is a common way to receive them as income. Failing to include these in your return could lead to penalties.

Creating a personal balance sheet is a great way to prevent this from happening and make it easier to submit your taxes. It allows you to keep track of all your cryptocurrency holdings in one place.

Failure to Report Transactions Between Cryptocurrencies

When you swap one cryptocurrency held as a capital asset for another, you're essentially trading one piece of property for another. This means you must report any capital gains or losses. However, many traders don't understand that it is taxable. This results in incorrect tax filing and possibly penalties in the future.

So next time you convert your Bitcoin to Ethereum or any other token, remember – it's a taxable event, and you must report it!

Poor Cryptocurrency Reporting of Forks, Splits, & Airdrops

Crypto tax reporting can be tricky due to hard forks, forks, and airdrops. An airdrop is a free giveaway of tokens to promote attention. A hard fork is when a blockchain token or coin is split into two, and a fork is an alteration to the blockchain protocols.

No matter if you don't have power over these cryptocurrencies, it has to be regarded as regular income. The fair market value at the time of receipt is the basis of the newly acquired crypto.

No Tax Planning for Crypto

Failing to plan and take advantage of tax-optimization measures can be costly. Have a clear goal in mind before entering a trade, and know your selling and buying points, plus what you will do in different situations. Estimate taxes to be paid, so you can budget and avoid having to sell assets to get the cash you need.

For a long-term tax strategy, speak to a crypto tax accountant. Planning can help you stay on top of your taxes and keep more of your investments.

It is critical to keep these mistakes in mind and take the necessary steps to avoid possible consequences. Also, using crypto tax services can be a great way to simplify the complications of crypto taxation. It can help you navigate the complexities of the tax system.

These services can save you time, energy, and money. Moreover, you can rest assured knowing that your crypto taxes are being handled in a professional and accurate manner.

The post Don’t Let Crypto Tax Mistakes Cost You: Here Are 6 to Avoid! appeared first on Datafloq.

THE WORLD'S LARGEST EMERGING TECH EVENT BRINGS LATEST TRENDS TO THE MIDDLE EAST

Following last year's groundbreaking debut success in Belgrade, TMRW conference, the world's largest emerging tech event, will be making its spectacular debut in Dubai, from February 8th till 10th 2023 at Dubai Festival City. The three-day event will be bringing the latest trends from the emerging tech industries and the worlds of Crypto, NFT and Metaverse. The speaker lineup will present nearly 80 world-renowned experts who will be giving lectures and keynotes, participating in panel discussions, interactive workshops and fireside chats. Aside from the carefully curated day program, the conference will organize networking events and VIP dinners, while the event will be streamed online as well.

The conference program will present the most attractive topics from the spheres of emerging technologies, such as blockchain development, artificial intelligence (AI), machine learning (ML), Internet of Things (IoT) technology, augmented reality (AR) and virtual reality (VR). Program will include various aspects of the future of cryptoco I Ii o urrencies such as increased adoption, regulation, decentralization and innovation. The “rule of code” will be discussed as one of the legal implications of blockchain technology, alongside regulated DeFi (RDeFi). The exciting world of NFTs will be presented through its new potential, where NFT utilities will be emphasized alongside its widely accepted collectibility.

TMRW Dubai star-studded speaker lineup brings the global industry heavyweights, such as Craig Sellars, Founder of Tether, alongside Dr. Marwan Al Zarouni, Strategic Advisor at Digital Dubai, ranked by CoinTelegraph as one of the top 100 most influential people worldwide in blockchain and cryptocurrencies in 2022 and Caner Sevinc, Regulatory Counsel of Wirex and is responsible for Wirex's global regulatory affairs. Next up are Joel Dietz, CEO of MetaMetaverse, Mark van Rijmenam, better known as The Digital Speaker, Dr. Michael Gebert, chairman of the European Blockchain Association, Konstantinos Adamos, Senior legal counsel at Revolut and Dr. Naveen Singh, the CEO of Inery. They will be accompanied by Anita Kalergis “KryptoGranny”, CEO & Founder of Ipsum Consulting, Nik Kalyani, Founder of NftyDreams DAO, Taylor Ryan, Founder of the Layer Three Ventures, David Bundi, Partner and Metaverse Strategy & Regulatory Leader at EY Switzerland, Anndy Lian, an all-rounded business strategist and serial blockchain entrepreneur from Asia, Loretta Joseph, global regulatory advisor at AP Capital, Jenny Zheng from Bybit and many more. The most renowned Dubai based speakers include Sharad Agarwal, Chief Metaverse Officer of Cyber Gear, Paul “The Profit” Dawalibi, Robert Lonsdorfer, CEO of Dubai based Hundred X and Nikita Sachdev, CEO & Founder of Luna PR.

“After last year's sensational debut in Belgrade, we are beyond proud to expand to three TMRW editions in 2023. We are always looking to push the boundaries further. Our first stop is Dubai where, as always, we will focus on the latest trends in the disruptive industries. This event is designed for tech entrepreneurs, professionals, investors, and developers who are interested in learning about emerging technologies. On top of that, we will create an environment for attendees to connect, make business partnerships, discover fresh ideas, and build their networks. At TMRW Dubai, we want our visitors to leave feeling empowered and ready for whatever comes next – empowered for tomorrow!” said Mladjen Merdovic, Founder and CEO of TMRW conference.

Regular tickets for in-person attendees, as well as virtual tickets, for those who can't make it to Dubai in February, are available via website tmrwconf.net.

Full program and agenda will be announced soon.

More information on the following links:

TMRW Website

TMRW Instagram

TMRW Telegram

TMRW Twitter

TMRW YouTube

TMRW TikTok

TMRW Linkedin

TMRW Facebook

The post TMRW Dubai appeared first on Datafloq.

Additionally, an increase in the number of payments and cross-border transactions has induced the probability of multiple risks within the global financial systems.

These increasing vulnerabilities within the financial systems have propelled the discussion for the central bank digital currencies (CBDC) entering the finance ecosphere globally.

However, the CBDC is likely to turn into a vicious cycle where governments might be taking actions that might be causing the economy to suffer at home. History has it, the world economies suffer when governments choose to act. On the contrary, if we can persuade mass adoption of digital currencies, we will be able to transcend this vicious cycle and give people freedom in the way they transact, exchange, and store value.

The conceptual adoption of CBDC as a potentially revolutionary force in the evolution of global financial transactions is further in congruence with an ingenious concept called “ownership economy.”

This altruistic framework for ownership economy is constituted of a steadfast and reliable mechanism that transfers value via the internet in real time. The philosophy of the ownership economy is further proliferated and publicized through the stringent data protection laws across the globe (such as GDPR), which prioritize individual privacy and sovereignty, and through the flourishing free markets.

So far, the argument for the evolution of central bank digital currencies seems pragmatic as they will formulate a trusted and easily accessible digital currency version that can be circulated and settled in the financial markets in real time.

CBDC: The Counterintuitive Proposition

While on a surface level, the CBDC appears to be the prime enabler for global leadership allowing them to level the playfield for an “ownership economy,” and towards enabling and augmenting the efficiency of financial markets across the globe. However, this is a counterintuitive proposition. The world can very easily face unanticipated, atrocious repercussions if, in our endeavors to furtherance, development, and demonstration of CBDC, something goes awry.

Before we think or scrutinize the repercussions, we must understand the two types of CBDC – wholesale and retail.

To enable real-time interbank payments and settlement, financial institutions tokenize their assets held at the Federal Reserve under the term “wholesale CBDC.”

A “retail CBDC” conceptually is a tokenized form of the dollar that customers might receive from either the Fed or their financial institution. Every time a person spends CBDC, the transaction is documented on a blockchain that the government controls.

Though it might seem a frantic concept to some, nothing can be riskier than creating a CBDC that is not open, permissionless, and private by sticking to a fabricated sense of urgency. Risks to privacy and security will be considered as a result of this conclusion. More generally, a CBDC will give the federal government power over every financial transaction if it does not mimic the fundamental principles of currency.

Right now, the entire globe is running in the rat race of CBDC, including the U.S. For instance, in the U.S. a retail CBDC is now being assessed by the Biden administration. The Federal Reserve, the Treasury, the White House, and others are desperately trying to keep up with their rivals in the mental, fugitive, non-discerning, and possibly a soft-power battle on CBDC research and development through a series of executive order directives. They also believe that the United States has lagged behind other countries like China in crypto development, though such thoughts seem lame, hypothetical, and non-discernible, considering the risks that could arise with running a mindless CBDC race.

Digital Currencies: The Making of Ultimate Global Pragmatic Solutions for Keeping up with a Cashless Economy with a Digitized Version of the Cash

The option of developing digital currency seems the most rational alternative for the countries rat racing for CBDC development.

The next several generations of the digital economy will begin when we create or support a digital version of our global currencies that increase transaction efficiency, widen financial inclusion, and uphold an individual's sovereignty.

For instance, a recent White House report on a potential United States CBDC twists the idea of privacy by proposing that a retail CBDC that operates on a blockchain, is managed and programmed by the central bank, is mediated by financial institutions, and is the best way to uphold Americans' right to financial privacy. Individuals' financial transactions would be recorded on an immutable database under the supervision of authorized parties, such as the Fed, on a “permissioned,” identity-verified blockchain, with the capacity to track who is making what transactions.

Technology that is inherently aligned with our ideals will flourish if we allow it to, opening the door to a more equitable and open economic system where people have more control over their contributions. If we choose to compromise our principles, we run the possibility of emulating a digital despotism similar to that of China. Even if only the United States walks the trail, the process will tacitly encourage the rest of the world to compete in the rat race.

From deplorable instances like the trucker protests in Ottawa in February of last year, the world must learn well in time before history repeats itself. The Canadian government used the banks as a tool to stifle protests and freeze the accounts of its citizens. The deployment of China's COVID tracking system to prohibit its citizens from accessing money in their bank accounts to halt a bank run is another such. We must move toward a cashless society, but we must never give up on decentralized money.

We must exercise patience, while allowing the private sector to develop, and innovate by learning from the myriad of financial freedom abuses that the internet economy has made possible across the globe.

Conclusion

We are on the verge of embarking on an era of a digital renaissance with the adoption of digital currencies globally where human interests and values will be at the epicenter of financial affairs.

The adoption of digital currencies will make it possible to pivot us towards an altruistic, “ownership economy,” in the true sense, rather than clinging to the flawed CBDC paradigm. This will be possible by leveraging the ability to innovate to make the financial markets and communications more efficient.

The development of policies that prioritize and defend human rights in privacy, individual autonomy, and free markets must go hand in hand with the birth of the internet era. Any person should be able to freely access and build upon the internet. The IoT infrastructure must be more resilient and secure, allowing technology to protect and advance human interests.

The post Why the World Must Transcend the CBDC Vicious Cycle Toward the Adoption of Digital Currencies appeared first on Datafloq.

So naturally, this shift will always favor those who adapt early. Think for a second, wouldn't it be great to organise with other people worldwide without knowing each other, establish your own rules, and make autonomous decisions based on blockchain technology? This is becoming a reality thanks to Decentralised Autonomous Organisations (DAOs). DAOs will be an important part of the metaverse and could revolutionize how democratic processes work and communities are formed.

Let's start by learning how and when this idea came for the first time.

When Was the Idea of DAO First Coined?

DAOs are like cooperatives, which have been around for years. In fact, one of The Netherlands' biggest banks, the Rabobank, is a cooperative with nearly two million members. However, today's know DAOs were invented in 2016 by developers inspired by the blockchain. DAOs are put in place to manage and oversee an entity, similar to corporations. The key to a DAO is that there is no central authority; the voluntary group of participants governs itself. So, these developers were thinking of a relatively new way of business transactions that is much safer than conventional ones.

An Overview of DAOs

Decentralised Autonomous Organisations are independent organisations with rules encoded in transparent computer programs-or blockchain,-and controlled by members instead of a central authority. No managers are needed since the rules are embedded in the code, and stored on a blockchain, so bureaucracy and hierarchy are removed. The blockchain facilitates the automated exchange of value and trusted transactions.

In other words, DAOs are community-driven entities whose operations and resources are not controlled by any central authority.

Due to the power of BigTech, it has become increasingly relevant for internet users worldwide to organize themselves safely and effectively, move away from centralized entities controlling our lives, and take back control ourselves. This is the new world we are entering in. This is the ultimate scenario and the bright future of business we can perceive. Just to emphasize what we are dealing with, a DAO is all about crypto, web 3.0, and the ultimate shape of a social business setup that connects like-minded people worldwide.

Smart contracts play an important role in DAOs. Logically coded agreements dictate how decisions are made based on underlying blockchain activity. The circulating token supply may be increased, reserve tokens burned, or rewards given to existing token holders if a specific code is implemented based on the result of a decision.

DAOs have a blockchain-based voting process. The number of tokens that each user holds determines their voting power. For example, one user who owns 100 tokens of the DAO will have two times the voting power as one who owns 50 tokens. Users often must choose between mutually exclusive options, so everyone has a voice, and the voting power is fairly distributed among the users.

Supposedly, users with a greater financial stake in the DAO are more likely to act in good faith due to this practice. Think about a user with a 25% share in the overall voting power. The user may engage in immoral behaviour, but their 25% holding will be at risk if they do so.

A DAO's Treasury typically houses tokens that can be exchanged for fiat currency. In some DAOs, members can vote on whether to relinquish treasury funds in exchange for assets to acquire, for example, rare NFTs, in order to make a better investment of the funds and obtain better long-term benefits.

For instance, in 2022, BendDAO launched as an NFT lending treasury, in which users could collateralize their NFTs to borrow ETH. Although the harsh bear market plummeted NFT prices that year, the treasury showcased the expansion of digital assets beyond cryptocurrencies-a trend other companies have followed.

The Role of Communities within the Development of DAOs

In a DAO, people with common interests band together to form virtual organizations governed by rules established through everyday democratic processes.

In a DAO, the focus shifts from a hierarchical and vertical structure to one that is more community-led and independent of its members. This allows rules to be encoded that allow the organization to perform independently, even with no managers.

Decentralized governance involves distributing authority to different locations in the organization. This contrasts with centralized entities, where shareholders and executives have power over everything going on within an organization.

Due to this different approach, DAOs have been heralded as a way of encouraging companies with more collective ownership and less focus on profits than traditional businesses.

A Guide to the DAO Types

DAOs come in many forms, each following the community's best wishes. And whether you love sports, music or investing-or anything at all-there is a DAO waiting for you to join it.

Let's explore some of the most popular kinds of DAOs, and highlight some innovative ways to use them.

AMM or Protocol DAOs

Automated Market Maker (AMM) DAOs use smart contract protocols to provide decentralised financial services.

MakerDao's stablecoin DAI is the first of its kind and has received widespread attention for changing how decentralized applications are built. At this point, MakerDAO is one of the most successful apps on Ethereum-with over 1,000 projects integrating DAI into their own unique systems.

One of the defining characteristics of AMM DAOs is their use of decentralized governance, which gives participants a type of hybrid cryptocurrency known as a “governance token.” This hybrid crypto can be used to make decisions that impact the network overall.

Grant DAOs

Grant DAOs are one of the earliest forms of decentralised autonomous organizations. In a Grant DAO, also know as DeFi DAO, members donate funds into a pool and then collectively vote on how those funds will be distributed.

DeFi DAOs are decentralised organizations that fund innovative new DeFi projects. And this flexibility is what makes them so practical: they distribute funding more effectively than traditional institutions.

Aave Protocol is one of many DeFi projects taking advantage of the Grants infrastructure in order to grow its community.

Aave's lending pool ecosystem gives users the option to contribute their own funds or borrow from other members' pools. Community voting rewards successful proposals with additional funding and encourages people to contribute their best efforts towards getting them passed.

Venture DAOs

These types of DAOs are not constrained by the tools and parameters we use to create our traditional investment portfolios; instead, they can raise hundreds of millions or billions in a matter of seconds, thanks to the huge demand for investing in cryptocurrency.

Investment DAOs are more inclusive than traditional firms-anyone can participate, regardless of location or bank account balance.

Venture DAOs, like The Krause House, allow us to invest in anything we want, even an entire NBA team. This fan-governed organization, which calls itself “a community of hoop fanatics just crazy enough to buy an NBA team,” identifies its mission as bringing the first fan-governed basketball team in league history.

Media DAOs

Media companies rely on advertisers to make money, so they produce content that will appeal to the largest possible audience.

A media DAO restructures the way content is made, allowing it to be driven by the community rather than advertisers and creators are rewarded with tokens.

Bankless DAO has created a user-friendly support platform to help people learn about decentralised finance. It uses media, learning channels, and culture to create windows of opportunity for curious users.

Another example is ForeFront, which is developing a crypto education hub for its community members. Through the hub, users will learn about social tokens-and be able to celebrate both community and growth initiatives of incubated projects.

As media DAOs continue to grow in popularity and influence, it's likely that these decentralized organizations will become major players-and beneficiaries-in the new digital economy.

Social DAOs

Social DAOs are gaining popularity among crypto enthusiasts. They are community-owned social clubs you can join by purchasing tokens (in the form of bitcoin). In addition, they aim to bring together people with common interests to participate in projects they share a passion for.

One such example we can see is a social group named Friends With Benefits, which can be considered a collective experiment for how web3 applications can enable new ways of thinking and creating. This social DAO recently raised $10 million from investors, including Andreessen Horowitz.

It is comparable to a decentralised Soho House and functions similarly to the online country club. The only way to get in is to purchase a certain number of FWB tokens. Members pay 75 $FWB tokens ($4,000) to join, and once they do, they are invited to chat in a Discord chat room where the group discusses crypto, trades job leads, and deals, and holds town halls. Group members organize local meet-ups in their towns and cities and members-only parties at major crypto conferences.

As you can see, there is a DAO for almost every conceivable type of business. The point is that these companies are designed to remove the obstacles faced by ordinary people trying to enter new markets.

With the help of a distributed autonomous organization, or DAO, people who would otherwise not have access to investment opportunities can pool their money and invest as they see fit.

What Are the Most Exciting Uses of DAOs in the Current Scenario?

As for the time I am writing this article, and there are many businesses currently working on this model, there is a huge flow of business toward this shift. Here we will discuss some remarkable and prominent examples of business models based on DAOs.

Uniswap

In today's crypto world, Uniswap is the world's largest Decentralized Autonomous Organization and has taken the top spot as the biggest decentralized crypto exchange. It became a legitimate DAO in September 2020 after launching its governance token. In contrast to the centralized exchanges that only offer a few hundred coins, it is the most active decentralized autonomous organization today. Since its launch in 2018, it has facilitated over $1 trillion worth of crypto trades.

You can apply for governance rights within the organization if you have been an active user for some time. Because of its good positioning over Decentralised Finance (DeFi) markets, Uniswap's membership and volume have grown exponentially.

There has been a lot of buzz in the crypto community over the last few years about Uniswap DAO. Uniswap is currently worth $5.2 billion, and its DAO token, UNI, is extremely popular.

BeetsDAO

BeetsDAO was created with the aim of pooling funds for investment in various projects. But it's also made a few commissions of new art and music.

BeetsDAO is building a platform to help create and sustain decentralized apps. With LABS, they offer creators an experience in learning about blockchain technology by focusing on their interests instead of technical jargon.

LABS have a decentralized network built in. They are supported by the treasury and membership and exist to support, engage with, produce and distribute cultural work.

PODS, BeetsDAO's fund and incubator program supports several web3 projects that are working to disrupt the status quo. In addition, BeetsDAO also collects and creates artwork.

In March 2021, the DAO purchased four rare EulerBeats Enigma NFTs- which are algorithmically generated audio files. One month later, they organized a collaboration between the original artist who created The Nyan Cat and Snoop Dogg to create a new token: “Nyan Dogg.” From the moment it was released, it made around $250K in investments.

BitDAO

The decentralised autonomous organisation BitDAO is committed to providing a decentralised tokenised economy as part of an ecosystem. By investing in other projects and partners in the DeFi field, the organization supports other projects and partners. Furthermore, the organisation facilitated several initiatives that could benefit the industry.

BIT serves as the project's governance token. BIT holders can propose every decision affecting the project and have the power to vote on them. As such, all decisions are approved by the community and voted upon properly.

BitDAO allocates funds for the growth of DeFi by developing BitDAO products and supporting other projects. The foundation's funding may also help BitDAO contributors, such as for the development of a special governance module or community management efforts.

ConstitutionDAO

This DAO aimed to buy a copy of the U.S. Constitution. Although ConstitutionDAO was not able to win the bid for a highly rare copy of the U.S. Constitution auctioned by Sotheby's in 2021, and the primary role was not a success, they succeeded in vaulting the concept of DAOs into mainstream culture.

This campaign showed how community organizing and speed could lead to success, revealed crypto donations' power in achieving a goal, and inspired other organizations/people to follow or copy its model.

ConstitutionDAO has proposed a system in which all contributors to the constitution would receive governance tokens called $PEOPLE proportionally.

PleasrDAO also broke the Doge meme image into fractional NFTs, with a more than $300 million valuation. Before that, the DAO could mint paper tokens representing its digital holdings-making it possible for members to hold “a piece of the U.S Constitution” on their smartphones and in physical wallets.

Strangely enough, ConstitutionDAO's token, PEOPLE, jumped to an all-time high since the project ended, and its price was much higher than it was before. It is currently behaving like a meme coin.

Compound

As one of the most popular lending DAOs in the DeFi space, Compound allows holders to earn returns on their investments by locking them into platform pools. COMP is one of the utility tokens of Compound that has earned a decent reputation among DAO tokens that have seen price fluctuations.

Compound's price is expected to be $298.41 by the time 2022 ends and have an average of $267.94 throughout the year. The currency still shows considerable potential for sustained growth in the future, despite being one of the least popular investment options.

The Compound DAO was developed by Compound Finance to govern its protocol. It allows token holders to make proposals, queue them for voting and execute the ones that pass.

In terms of the development of the DAO of this large DeFi network, it includes some built-in features to manage this process: a minimum number of tokens is required in order to make a proposal. Proposals are open for voting by the membership, and a minimum number of votes is required to pass.

PleasrDAO

PleasrDAO is another example involving crypto artists, entrepreneurs, and investors bidding on high-profile digital works. Spending $5.4 million on an NFT affiliated with Edward Snowden, in addition to $4 million on the Wu-Tang Clan album called “Once Upon a Time in Shaolin,” the group spent $4 million on another album from the Wu-Tang Clan.

The members of PleasrDAO recognize and appreciate the value that Snowden's leaks have for programming. The auction combined a donation to the Freedom of Press Foundation (which works to protect and promote journalism in an open society) with bids that allowed individuals who were unable to attend conferences or workshops.

PleasrDAO distributes tokens, each of which represents a fractional ownership share in the company. That means every member has a share of the DAO‘s assets. Each participant in the group chat can take part directly in governing the organization, and if someone were to leave (selling their token on an exchange), that person would no longer have voting rights within it.

The Correlation Between DAOs and Cryptocurrency

To join a DAO, users must first buy the group's cryptocurrency. The more of that currency they own-typically by owning tokens distributed in an initial coin offering (ICO)-the greater their voting power within the organization.

BitShares was the first successful example of a DAO-a virtual e-commerce platform that connects merchants and customers without a central authority. BitShares' creator, Dan Larimer, coined the term DAC when he created Bitshares.

As a result, many DAOs have implemented internal capital systems designed to incentivize and reward actors who contribute to the platform. Once a DAO is established, and its rules have been programmed within smart contracts, it enters a “funding phase” that allows anyone wishing to contribute to access it.

It makes sense why people would want to pool their money to buy things. Then why do we need a whole new governance structure based on cryptography? Isn't a crowdfunding site a better option?

They certainly could.

However, the answer is very simple. It is because of the transparency and autonomy this kind of investing offers, it is growing in popularity-and may change how people invest. Above all, it is a shift away from centralized entities that control who has access to what to a more democratic process.

Then, Why Would People Join a DAO?

Despite their rapid growth, DAOs are still in the dial-up phase, and proponents believe better, more powerful examples will appear in the coming years. Most people join DAOs because they are in need of independence and do not want the interference of intermediaries and centralised companies.

DAO believers, however, say that traditional organizations cannot compete with DAOs in a few areas:

1. DAOs use governance tokens, and votes are recorded in a permanent blockchain ledger; DAOs are theoretically more trustworthy than traditional organizations.
2. Every participant has the right to vote on group decisions, therefore, DAOs are more democratic than traditional organizations.
3. DAOs are often project-specific, so they are flexible and quick to respond. With significantly less red tape, you can set them up and wind them down more quickly than forming a traditional start-up.

You can code your smart contract in such a way that every time an NFT is sold, a percentage of the proceeds automatically goes to fund your DAO. This helps the organization achieve its mission, one of the goals on its roadmap or launch a new project.

By using blockchain-based tools, businesses can cut out a lot of red tape-the “if this, then that” logic baked into each contract means they only trigger when certain conditions are met. If the work is complete, they receive payment without waiting for someone else's approval or enduring bank fees.

The bottom line is that DAOs can help emerging NFT creators cultivate a sense of community and foster collaborations with investors to invest in gated events. With NFTs offering people ownership of virtual assets and DAOs providing new pathways for asset-based investing, the convergence of these technologies will certainly lead to continued innovation.

Risks and Challenges of DAO

DAOs have many advantages over traditional business models, but they also come with their own set of challenges. Here are some of the main risks associated with DAOs:

One of the main risks are related to programming errors and attack vectors, which are likely to have plagued The DAO in May 2016, according to IEEE Spectrum6. The DAO was a decentralized, open-source investment fund that used a smart contract to facilitate transactions. The DAO gathered around $150 million in funding; its crowdfund made it the most successful ICO ever at that time.

Voters with DAO tokens could cast their vote on propositions and receive rewards as long as those outcomes resulted in a net gain. However, the DAO‘s contract contained serious flaws that allowed attackers to drain its funds. The programmer created a loophole that enabled requestors of funds to make multiple withdrawals before their balance was updated by the smart contract.

The organisation was likely venturing into new territory in terms of regulation and corporate law. The organisational structure of the DAO could have numerous ramifications: Investors were concerned they would be exposed to liability for actions taken by the broader organization as a whole.

Let's see other setbacks DAO can have.

Lack of Control

DAOs were designed as investment vehicles where token holders could vote for investment proposals. A 2017 SEC investigation into the early DAO, called “The DAO” – which suffered a security breach that resulted in approximately $50 million worth of ether being stolen-discussed some of these DAO liability issues. The SEC, however, examined The DAO‘s operations and determined that, in reality, much of the DAO‘s activities are centralized through a board of curators selected by The DAO‘s creator.

As a result of their distributed nature, the token holders of the DAO could not exert any real control over the hand-picked curators who presented them with curated proposals. The curators were chosen without their input.

According to the SEC, the DAO resembled a corporation rather than a general partnership due to its dispersed token holders and curated proposals: As a result, DAO Token holders could not exercise meaningful control over the enterprise through voting, resulting in their voting rights similar to corporate shareholders. A DAO‘s token holders may not all be liable for the acts of a DAO, according to the SEC's conclusion in The DAO Report.

So I highly advise you to do your proper research like starting any new business.

High Operational Costs

Most DAOs operate with cryptocurrency funding, and every crypto transaction carries a small fee referred to as “gas.” These fees are compensation for the work that miners perform to validate transactions. To execute a transaction in the second-most valuable cryptocurrency after Bitcoin (by market capitalization), Ether, users must pay “gas fees” to validate and store the transaction on Ethereum.

The worst part about this situation is that token holders are charged for gas fees even if their transaction does not go through. Because of this, the 17,000 individuals who sought to purchase an original copy of the U.S. Constitution at auction were exposed to downside risk.

Although donors were promised a refund if they lost the auction, members still had to pay gas fees of 3% on top of the total cost. These expenses amounted to more than $1.5 million out of nearly $47 million raised in donations.

Since the transaction fee structure is built into many decentralized blockchains, DAOs are less likely to use them for fundraising.

Chances of 51% Attacks

A 51% attack occurs when a single person or group of people gains control of over 50% of the total mining power for any given blockchain. This is usually achieved by renting hash power from third parties. Unfortunately, these attacks represent a latent threat to DAOs due to the nature of the attacks based on blockchain technology.

Attackers can prevent new transactions from being confirmed and re-order the sequence in which they're processed. Malicious agents can rewrite parts of the blockchain, reversing their own transactions and creating an issue called double-spending.

As the size of a blockchain network grows and acquires more mining nodes, it makes attacks that attempt to gain control over 51% of hashing power less likely. One of the reasons is that a 51% attack is more expensive to pull off on a network with lots of miners and hash power because it requires the attacker to control over half of the total combined computing resources.

However, within a DAO, a 51% attack could happen if a person or group of people would achieve more than >50% of the votes within a DAO – for example by purchasing the cryptocurrency that governs the DAO – it could alter the direction of the DAO potentially contrary to the wishes of the community.

A Look at the Future of DAOs

There are endless hope and possibilities for a decentralized future. A Web3 network is similar to the “read/write/own” version of the internet since users can link programs and content directly without relying on a central server. Rather than centralized applications controlled by tech giants, Web3 tries to do what the internet hasn't been able to do so far: promote open services powered by decentralized protocols.

Due to its decentralized nature, Web3 services' resilience, fairness, and ethical character are considerably higher. Tech platforms are no longer accessed in exchange for a monthly fee and users' personal information. The participants are not just customers or products that economic pressure exploits but are real network stakeholders. Decentralised networks allow users to access, govern, and own decentralized tokens or cryptocurrencies. Web3 places you in the owner position, unlike the product in Web2.

Experts predict that within the next 10 years, DAOs will manage assets of the same value as corporations do now. Imran Khan, founder of the pre-seed crypto fund Volt Capital and a founding member of Web3 accelerator Alliance, predicts that DAOs will have one trillion in AUM-Assets Under Management-by 2032.

The hype surrounding DAOs has been fueled by their potential to deliver an unparalleled value proposition.

What are the Benefits for Businesses?

Many mainstream tech giants, such as OpenSea, including those in the tech and payment sectors, are converting to Web3 platforms. NFTs and DAOs are among the factors driving this trend.

All contracts, decisions, and transactions are publicly viewable and verifiable since they are built on an open blockchain, and owners remain anonymous. With a DAO, it becomes possible to bring together a community of users with similar interests to work together toward a common goal without centralized control or a single point of authority.

As a consequence of DAOs such as PleasrDAO, NFTs can be shared equitably and more inclusively, reinforcing the decentralised ethos of accessibility and inclusion.

The popularity of DAOs will continue to grow and spread into nonprofit organizations, decentralized finance, and NFT collections, allowing them to thrive in the future. The DAO model also provides an effective governance structure for Web3 that boosts participation, reduces corruption, and reduces censorship risks. A DAO also allows instant decisions once all participants reach an agreement instead of being slowed down by hierarchical structures.

Furthermore, business organisations such as charities could benefit significantly from DAO structures. Fund allocations and administrative tasks often consume more time and money than charitable activities. Here DAOs again provide a solution. Funds can be distributed to the right channels efficiently and quickly. As a result, charities can exploit their end causes more effectively.

A DAO can also act as a direct pathway for investments and accelerate the adoption of DeFi. DAOs enable low-cost, nearly real-time peer-to-peer transactions without adhering to traditional financial restrictions. By lending or paying transaction fees, they can earn better returns. This space is rapidly growing with no signs of any slowdown soon.

Considering this generation's high emphasis on social media and content creation, NFTs and DAOs will further allow the creator economy to flourish. Creating works of art directly benefits the creator since their brand, fan base, and organization are all connected to the value of the products.

Today, most people aren't exposed to DAOs every day. Nonetheless, I believe understanding the problems technologists are trying to solve is essential.

Final Thoughts

DAOs are a polarizing topic for discussion. Some enthusiasts want to see them implemented for everything from government services to internet forums, while others see their potential as limited. Regardless, it is important that individuals who are given decision-making power over decentralized entities regulate themselves enough to carry out these decisions fairly and democratically. Rules dictated through the blockchain is the only way DAOs can avoid the pitfall of centralization, both for-profit and non-profit levels of governance in society.

The post All You Need to Know About Decentralized Autonomous Organisations appeared first on Datafloq.

The ever-growing crypto market presents a lucrative opportunity for new and established investors, but it also brings about numerous challenges. One of them is, without a doubt, the challenge of ensuring the safety and security of your investments. Whether you're primarily investing in cryptos orNFTs, you need to protect your assets in the online world.

Here are some tips that will help you to secure your crypto and NFT assets in 2022 and beyond.

Insuring your cryptocurrency

First things first, can you insure your cryptocurrency? The short answer is yes, but you need to cover your bases and understand what cryptocurrency coverage entails. Currently,cryptocurrency insurance has reached three billion US dollars, suggesting that insurance is one the rise among investors and traders who want some form of coverage against coin theft and loss.

Cryptocurrency insurance is nowadays widely available for businesses, and it protects against theft, scams and general loss of assets. Insurance for personal crypto wallets is still scarce, though, but you can find insurers who are willing to set flexible limits to insure a portion of your cryptocurrency investments. For businesses looking to insure their crypto investments, however, insurers will typically provide coverage for exchanges, wallets, infrastructure, mining, custodians, and payment processing.

Create and secure your seed phrases

What is a seed phrase? A seed phrase is a string of words generated for you when you open your crypto wallet. This is a general failsafe, in a sense that should something happen to your wallet (like it being stolen or broken into), you can enter yourseed phrase to recover your wallet and its contents.

Needless to say, creating a strong seed phrase that only you know is one of the most important tips for securing your digital wallet. There are other security tactics, which we'll cover, but this master recovery code is the only thing that will save you if your wallet gets compromised.

Typically, though, you wouldn't want to create the seed phrase yourself, as it can be unreliable and you may be tempted to use association phrases to avoid forgetting the phrase. Instead, let the system generate a completely random seed phrase for you.

Once you have your seed phrase, keep it safe. You can write it down and put it in a physical safe, or secure it in a cloud-based data repository. You can also store it on an external hard drive, but keep in mind that this can be risky as well.

Know how to protect your NFTs

NFT investing has boomed in the last two years, and while they are becoming increasingly popular around, there's no denying that they are under a lot of threat as well. Scammers, hackers, and thieves in general are always on the lookout for weak NFT security in order to exploit security vulnerabilities and gain access to these prized assets.

Fortunately, there are ways to protect these investments. For one, avoid owning a high-value NFT on your own. Instead, considerfractional NFTs as a way to limit your investment and share the ownership with others, which makes holding on to a high-value NFT easier and will allow you to protect your investment more efficiently.

You can protect yourNFTs in a variety of ways. From strong passwords to online vaults, and all the way to hardware vaults, there are numerous options at your disposal. However, nothing is more secure against online threats than a physical vault.

Also known as a hardware vault, this is a physical device where you can store all your NFTs in a location only known to you. There's no risk of theft or break-ins from the online realm because the NFTs are not online anymore, so there's really no better way to secure them. That said, if someone gets their hands on the physical device, your NFTs might be at risk – but only if they manage to get the decryption password as well.

Avoid investing in coins with low ratings

Nowadays, you can find credible online sources for ranking new and established cryptocurrencies, assessing not only their value and potential ROI, but also their security, the trustworthiness of the ICO, and more. This is invaluable information for an investor, whether you are new to the game or if you've been investing for years.

And the good thing is that the best brands out there dealing in coin ratings and assessments are under constant review by the online community. Recently, one of the most popular ratings companies calledWeiss Crypto Investor was in a deep-dive review by The Stock Dork, a prominent online resource for investors and business leaders.

This and other similar reviews ensure transparency and accountability in the industry, so that you know whom to trust and what investment advice to take. This particular review of Weiss Crypto Investor was a positive one, but that doesn't mean that there aren't other brands out there that are just trying to take your money and make you invest in the wrong cryptocurrencies.

Work only with trusted financial companies

There are many financial advisors and financial companies out there that you can trust to make these investments for you. But can you trust them to keep your assets safe as well? Typically, financial companies that offer these services will not provide any kind of guarantees that your investments will be secured against any liabilities – you will have to secure them yourself.

Be especially wary of financial companies that havemobile apps as those can be another security threat. Scrutinize the app and their platform as a whole to verify that any sensitive data they handle is safe and secure.

What all of this essentially means is that you need to choose who you work with wisely. Look for companies that are marketing themselves using clear messaging, factual data, and transparent, verifiable statements. Now thatmarketing for finance in the crypto sphere has increased over the past few years, you can easily discern between genuine marketing and false advertising.

Don't fall for catchy phrases and keywords, instead, look for clear messaging and read the fine print. If a financial company does offer crypto security, be sure to talk with the managers to find out exactly what that means.

Over to you

Securing your crypto assets and other investments is a crucial step towards long-term success in this oversaturated market. While you might think that the digital wallet you're using has all the features you need to keep your cryptocurrencies safe, it's important to keep in mind that it takes more to properly secure your assets.

It takes smart decision-making based on security best practices, and that means that you need to follow the latest security trends in this sector. With these tips in mind, go ahead and secure your cryptos and NFTs against nefarious online activity and enjoy the fruits of your labor.

The post 5 Important Things to Know About Securing Your Crypto Assets appeared first on Datafloq.

What is a Token?

A token is defined as a digital asset that is used for trading either physical or virtual assets. Each token is owned by a particular Blockchain address, which refers to the unique identity of the token. Depicting a set of predefined rules in smart contracts, tokens facilitate collaboration across a variety of markets and jurisdictions enabling transparent, efficient, and fair interactions in the physical, virtual, and legal world.

Features of Token Development Services

Secure Digital Wallet
The Token Development Services offer a Digital wallet protecting the tokens by enforcing several security protocols from a security breach.

Tailored Smart Contract
Smart Contracts depict the self-executing codes which refer to the agreements between the buyer and seller ensuring traceable, irreversible, and transparent transactions.

Fractionalization of Assets
Fractionalization of assets in tokens is defined as splitting the ownership of virtual assets enabling many people to benefit from it in a proportion to the share of the digital asset they own.

The post Token Development- Everything You Might be Curious to Know! appeared first on Datafloq.

The ever-growing crypto market presents a lucrative opportunity for new and established investors, but it also brings about numerous challenges. One of them is, without a doubt, the challenge of ensuring the safety and security of your investments. Whether you're primarily investing in cryptos or NFTs, you need to protect your assets in the online world.

Here are some tips that will help you to secure your crypto and NFT assets in 2022 and beyond.

Insuring your cryptocurrency

First things first, can you insure your cryptocurrency? The short answer is yes, but you need to cover your bases and understand what cryptocurrency coverage entails. Currently, cryptocurrency insurance has reached three billion US dollars, suggesting that insurance is one the rise among investors and traders who want some form of coverage against coin theft and loss.

Cryptocurrency insurance is nowadays widely available for businesses, and it protects against theft, scams and general loss of assets. Insurance for personal crypto wallets is still scarce, though, but you can find insurers who are willing to set flexible limits to insure a portion of your cryptocurrency investments. For businesses looking to insure their crypto investments, however, insurers will typically provide coverage for exchanges, wallets, infrastructure, mining, custodians, and payment processing.

Create and secure your seed phrases

What is a seed phrase? A seed phrase is a string of words generated for you when you open your crypto wallet. This is a general failsafe, in a sense that should something happen to your wallet (like it being stolen or broken into), you can enter your seed phrase to recover your wallet and its contents.

Needless to say, creating a strong seed phrase that only you know is one of the most important tips for securing your digital wallet. There are other security tactics, which we'll cover, but this master recovery code is the only thing that will save you if your wallet gets compromised.

Typically, though, you wouldn't want to create the seed phrase yourself, as it can be unreliable and you may be tempted to use association phrases to avoid forgetting the phrase. Instead, let the system generate a completely random seed phrase for you.

Once you have your seed phrase, keep it safe. You can write it down and put it in a physical safe, or secure it in a cloud-based data repository. You can also store it on an external hard drive, but keep in mind that this can be risky as well.

Know how to protect your NFTs

NFT investing has boomed in the last two years, and while they are becoming increasingly popular around, there's no denying that they are under a lot of threat as well. Scammers, hackers, and thieves in general are always on the lookout for weak NFT security in order to exploit security vulnerabilities and gain access to these prized assets.

Fortunately, there are ways to protect these investments. For one, avoid owning a high-value NFT on your own. Instead, consider fractional NFTs as a way to limit your investment and share the ownership with others, which makes holding on to a high-value NFT easier and will allow you to protect your investment more efficiently.

You can protect your NFTs in a variety of ways. From strong passwords to online vaults, and all the way to hardware vaults, there are numerous options at your disposal. However, nothing is more secure against online threats than a physical vault.

Also known as a hardware vault, this is a physical device where you can store all your NFTs in a location only known to you. There's no risk of theft or break-ins from the online realm because the NFTs are not online anymore, so there's really no better way to secure them. That said, if someone gets their hands on the physical device, your NFTs might be at risk – but only if they manage to get the decryption password as well.

Avoid investing in coins with low ratings

Nowadays, you can find credible online sources for ranking new and established cryptocurrencies, assessing not only their value and potential ROI, but also their security, the trustworthiness of the ICO, and more. This is invaluable information for an investor, whether you are new to the game or if you've been investing for years.

And the good thing is that the best brands out there dealing in coin ratings and assessments are under constant review by the online community. Recently, one of the most popular ratings companies called Weiss Crypto Investor was in a deep-dive review by The Stock Dork, a prominent online resource for investors and business leaders.

This and other similar reviews ensure transparency and accountability in the industry, so that you know whom to trust and what investment advice to take. This particular review of Weiss Crypto Investor was a positive one, but that doesn't mean that there aren't other brands out there that are just trying to take your money and make you invest in the wrong cryptocurrencies.

Work only with trusted financial companies

There are many financial advisors and financial companies out there that you can trust to make these investments for you. But can you trust them to keep your assets safe as well? Typically, financial companies that offer these services will not provide any kind of guarantees that your investments will be secured against any liabilities – you will have to secure them yourself.

Be especially wary of financial companies that have mobile apps as those can be another security threat. Scrutinize the app and their platform as a whole to verify that any sensitive data they handle is safe and secure.

What all of this essentially means is that you need to choose who you work with wisely. Look for companies that are marketing themselves using clear messaging, factual data, and transparent, verifiable statements. Now that marketing for finance in the crypto sphere has increased over the past few years, you can easily discern between genuine marketing and false advertising.

Don't fall for catchy phrases and keywords, instead, look for clear messaging and read the fine print. If a financial company does offer crypto security, be sure to talk with the managers to find out exactly what that means.

Over to you

Securing your crypto assets and other investments is a crucial step towards long-term success in this oversaturated market. While you might think that the digital wallet you're using has all the features you need to keep your cryptocurrencies safe, it's important to keep in mind that it takes more to properly secure your assets.

It takes smart decision-making based on security best practices, and that means that you need to follow the latest security trends in this sector. With these tips in mind, go ahead and secure your cryptos and NFTs against nefarious online activity and enjoy the fruits of your labor.

The post 5 Important Things to Know About Securing Your Crypto Assets appeared first on Datafloq.

To replicate the aforementioned success, more and more businesses and private investors buy land in the metaverse. If you are considering purchasing virtual property and benefiting from metaverse software development services, you are probably asking yourself a set of questions: How to buy virtual real estate in the metaverse? Is it safe? How to choose the right spot? And how much will it cost?

Keep reading, and hopefully, this will help you make your decision.

What is metaverse real estate?

Metaverse real estate are parcels of land or commercial and residential buildings that exist in a virtual world. On that land, you can create all types of property from advertising billboards to commercial districts and headquarters of companies that exist in real life. In the simplest sense, the metaverse real estate objects are pixels on your computer screen. But they are also programmable spaces on different platforms where people can socialize, sell non-fungible tokens (NFTs), play games, advertise their products and services, and even attend business meetings via 3D avatars.

This is how Janine Yorio, CEO of Republic Realm, explained metaverse real estate in New Rules of Business podcast, Metaverse real estate is an NFT. They are a JPEG or [digital file that] points to a specific file that is logged on the blockchain, which is this ledger that tracks who owns [each asset]. Much the same way that if you bought land in a town, you'd go to the town hall and open a drawer to find your deed. Instead, you're looking at the blockchain.

Since Facebook rebranded itself as Meta, in 2021, the value of real estate in the metaverse market has increased significantly, and it is predicted to continue rising at a CAGR of 31.2% from 2022 to 2028.

Source

How to buy real estate in the metaverse?

To buy virtual land in the metaverse, you first need to get hold of cryptocurrency. Some metaverse platforms provide their own coinage. For example, Sandbox trades its native cryptocurrency SAND, and Decentraland uses MANA. Sometimes, general-purpose cryptocurrencies, such as Ethereum, work as well.

Even though the land is virtual, it is secured with a very real thing, NFTs. When someone purchases real estate in the metaverse, this transaction is recorded on the blockchain, and the corresponding NFT transfers into the buyer's digital wallet. Metamask and Binance wallets are rather popular.

You can buy virtual properties directly from your platform of choice, or you can benefit from third-party resellers, such as nonfungible.com, a platform that allows owners to list their property and buyers to negotiate the price.

Metaverse real estate prices

Real estate in the metaverse costs are skyrocketing. Take, for instance, Decentraland. When the platform held its first auction in December 2017, it sold parcels of land for $20 each. By 2021, the cost of this commodity catapulted to $6,000, and it kept increasing to reach $15,000 by the start of 2022. Virtual land on the Sandbox, another metaverse platform, grew by 15,000% in 2021.

Prices of virtual land plots can vary significantly based on their size, platform, and location. You can get a small parcel in Somnium Space for $6,362, while a lavish plot on Decentraland would cost you $2.4 million.

When you prepare for metaverse real estate investing, don't forget about all the accompanying expenses. Besides the parcel's price, you are likely to pay processing fees, which can amount to 5% of the land price, in addition to gas fees for Ethereum-based projects. Also, some metaverse platforms require you to trade in their native cryptocurrency. If you don't have those, be prepared to exchange one currency for another with all the losses that this transaction entails.

Metaverse real estate platforms

There are four commonly used metaverse platforms The Sandbox, Decentraland, Cryptovoxels, and Somnium Space. The first two offer a well-established infrastructure and feature celebrities as landlords and tenants. The Sandbox is particularly popular with celebrities. According to Yat Siu, Co-founder of Aminoca Brands, the owner of the Sandbox, ”'What makes Sandbox land valuable is not the fact that they're blocky pieces of land. It's the fact that the most influential people in the space are building on it.' This list includes Paris Hilton and Snoop Dogg, who owns a mansion and throws parties.

The four platforms together offer 268,645 parcels of land varying in size. Below you can find a brief description of every platform, and a graph representing sales for a one-month period. The graphs for all four platforms are constructed for the same timeline, so that you can compare them for profitability.

Sandbox

With 166,464 parcels, 96 x 96 meters each, this metaverse real estate platform owns approximately 62% of the entire market. It has its cryptocurrency i.e., SAND and it uses the Ethereum blockchain.

The Sandbox leans towards gamification. It supplies users with tools to craft items and even create their own games. The platform consists of three integrated products:

• VoxEdit. This is a powerful 3D voxel modeling and NFT creation package, which allows participants to build and animate objects, such as humans, animals, tools, etc. Created items can be exported into the Sandbox marketplace to represent game assets.
• Marketplace. This is the marketplace where users can upload and sell their VoxEdit creations. All items are first uploaded to the IPFS network for storage and are registered on a blockchain to prove ownership. Afterwards, items become assets and can be exhibited and sold in the marketplace.
• Game Maker. It allows users to develop games for free with the help of visual scripting tools.

Source

Participants can generate revenue by creating assets and games, and by buying and renting land. The Sandbox secured over 50 partnerships with renowned companies and brands, such as Atari and Dapper Labs.

Decentraland

Decentraland contains 90,601 parcels of land 16 x 16 meter each, and the whole metaverse is divided into several districts. This real estate in the metaverse platform is built on the Ethereum blockchain and is entirely user-owned, allowing the participants to create avatars, marketplaces, and virtual settings. It offers its native cryptocurrency, MANA, which can be easily purchased through popular crypto exchanges.

There are two ways to create digital content on Decentraland:

• The Builder is a drag-and-drop visual tool. Users have access to a large number of pre-made items, including interactive items that react to players' feedback. It is also possible to import custom models.
• The SDK supports writing code, which gives great flexibility for creating items and scenes

Participants can generate revenue by creating and selling items, but also by advertising and offering paid experiences to other users.

Source

Cryptovoxels

This real estate in the metaverse platform is also powered by the Ethereum blockchain. It offers 6,554 land plots with an average price of $5,000 per lot, but some premium locations can sell for as much as $10,000.

Users can buy land parcels and create storefronts, art galleries, theaters, and mazes. Visually, this game looks like a combination of Minecraft and Facebook. Users build blocks and then customize their design by adding text, images, and audio files. Participants can make money by selling their avatars, unique usernames, and NFT items, as well as reselling virtual land.

One innovative feature of this platform is supporting VR headsets, such as Oculus Rift and HTC Vive.

Source

Somnium Space

This metaverse real estate platform contains 5,026 parcels of land that can come in three different sizes: small, medium, and extra-large. One can buy small parcels for $2,000 to $4,000, while large plots can cost up to $43,000.

Somnium Space offers an immersive VR experience and can be accessed through a laptop or a mobile device. It offers a software development kit to support users in the creation and customization of their own avatars and property. The platform's cooperation with the Polygon network allows participants to transfer their assets in and out Somnium Space to reduce fees.

This metaverse platform allows users to tokenize their avatars, land, wearables, vehicles, tickets etc. using the Ethereum blockchain and has no stakes in their earnings. In addition to monetizing items, property owners can sell teleportation hubs and organize treasure hunts.

Source

Why invest in the metaverse real estate?

Generally speaking, metaverse technology presents many opportunities for business leaders. There are several reasons to purchase land and other real estate objects in the metaverse:

• Buy and sell when the property appreciates in value
• Conduct business by selling advertising spots, hosting events, collecting rent, etc. For example, to host an event, you can simply rent a concert hall or another space, create and sell tickets, and create NFT merchandise to monetize at your event
• Have fun with the property and use it to socialize, express your personality, and demonstrate digital collectibles

Even though the real estate in the metaverse market fairs rather well at the moment, there is no guarantee that prices will keep going up. There are several risks associated with this type of investment:

• This market lacks regulations. If the seller acts in bad faith, the buyer's opportunities for seeking restitution are limited.
• Virtual land's valuation. In the real world, land is a finite resource, and it increases in value as more people show desire for ownership. However, virtual land is infinite in theory. Metaverse platforms are enforcing artificial scarcity by limiting the number of land plots they sell. But if all is sold and the demand remains, nothing prevents those platforms from programming more land plots.
• Potential technology-associated risks. The trade occurs in cryptocurrency, and the proof of ownership is stored as an NFT. If the buyer forgets their password or otherwise fails to authenticate, the ownership right will be compromised. Also, if your metaverse platform goes offline, the property disappears.
• Technological advances, such as quantum computing, can, in theory, render today's cryptographic security methods obsolete.

#How to choose the right spot to invest in

• Study the performance metrics of the selected metaverse platforms, such as the number of users interacting on each platform and the type of companies conducting business in this virtual reality
• After settling upon one metaverse platform, carefully consider the location of your prospective land. Parcels around famous brands and celebrities are fetching premium prices.
• Check out the price history at your metaverse real estate of choice to see how much it has appreciated or depreciated over time

Examples of real estate in the metaverse

Republic Realm, purchased land worth $4.3 million from the Sandbox. The company decided to develop 100 islands on the property with their own villas and boat market. Ninety of them were sold on the first day for $15,000 each, and some owners are listing their acquisitions for resale for over $100,000.

Another large transaction comes from a crypto investor Tokens.com who acquired virtual property on Decentraland for $2.4 million. The land is located in the Fashion Street area, and the company is planning to host digital fashion shows with brands such as Dolce & Gabbana and Tommy Hilfiger. As Tokens.com CEO, Andrew Kiguel said, ”'We don't want to sell the land, we want to continue buying land.

Property development companies also don't want to stay behind and try to harness this new technology to gain competitive advantage. For instance, Magnolia Quality Development Corporation (MQDC), a leading international property developer, teamed up with Accenture to create a virtual real estate metaverse. Visit Malaisirirat, Chief Executive at MQDC said, ”'This approach has made us a technological pioneer to bring sustainable well-being to people and society in an era of digital transformation.

According to Mr. Malaisirirat, the collaboration with Accenture focuses on providing MQDC's customers with experience beyond imagination, opening opportunities for clients interested in the metaverse in the context of property development, and simply offering a space that connects virtual and real worlds, allowing people to have a hybrid experience.

Other activities include:

• Warner Music is planning on hosting concerts at its property in the Sandbox
• Barbados decided to open its embassy in the metaverse
• An anonymous user has recently paid $450,000 to acquire a land parcel in the Snoopverse a metaverse owned by Snoop Dogg

Real estate in the metaverse: market trends and predictions

Real estate in the metaverse sales amounted to $501 million in 2021 and already exceeded $85 million in January, 2022 alone. Going at this pace, this market could reach $1 billion by the end of 2022.

Big companies, such as Meta, Nvidia, and Microsoft, are betting on the metaverse to become the next generation of the Internet. If this materializes, real estate in the metaverse will offer many opportunities for businesses and influencers to build new audiences, create and market new products and services. This excitement is supported by Accenture's recent survey, which shows that 71% of global executives questioned by the consultancy report that metaverse will be beneficial for their business, with 42% believing this technology will have a transformational impact.

However, there are factors that work against the metaverse. The Quarterly NFT Market Report shows that NFT sales volume in the metaverse is still rather modest in comparison to other NFT segments.

Source: Quarterly NFT Market Report Q1 2022

Additionally, some audiences, especially the older generation, doubt that the metaverse will live up to its promises. For example, Edward Castronova, Professor of Media at Indiana University, believes, ”'The Metaverse is El Dorado for internet startups. They chase it into the jungle and die.

Andrew Kiguel, CEO at Tokens.com, a digital assets company based in Canada, replies to this by saying, ”'The problem a lot of people have is that there are generations that have a difficult time attributing value to things that are digital, that you can't hold and that don't have weight.

Deloitte, also concerned with the future of the metaverse, recently published a report saying that the future of this technology depends on four factors:

• Standardization: will there be a unified economy across metaverse platforms together with consistent design and programming standards?
• Market fragmentation: will different platforms serve different use cases, or will they compete for the same customers?
• User interface: will the platforms offer intuitive interface and seamless user experience?
• Governance: will there be strong government regulations to ensure secure transactions and prevent fraud, or will every platform have to implement their own rules?

There is no reliable way to determine whether your real estate in the metaverse platform of choice will survive in the future. But it is safe to say that if this platform has an engaged and loyal community, its chances of flourishing are higher. So, if you decide to purchase virtual land in the metaverse, you can try organizing community events or building something interesting that people would want to be around.

Thinking about investing in real estate in the metaverse? Get in touch! ITRex experts will help you select the metaverse platform that satisfies your needs. Then you, together, will build real estate 3D models and implement the business logic behind your custom solution.

Originally published at https://itrexgroup.com on May 18, 2022.

The post Real Estate in the Metaverse: Market Trends, Opportunities, and Tips appeared first on Datafloq.

GameFi changes the way that players interact with online games rather than paying to play online games that earn virtual rewards with no value, players can own digital assets in their games. The ownership incentivizes greater loyalty, engagement, and positive stewardship of gaming communities. GameFi is unique to blockchain applications, and it makes use of NFTs and cryptocurrencies to incentivize gamers to play. In-game assets including the characters, land, weapons, and more can be bought and sold for cryptocurrencies on NFT marketplaces.

Source: Grayscale

GameFi NFT projects mint own tokens and construct virtual game economies. Usually the tokens function as both a utility and governance token. Utility tokens are used for in-game activities, like buying game characters, clothing, and other items. They're also used for distributing rewards to the community of players. Governance tokens give voting rights to their holders in the decentralized autonomous organization (DAO).

One popular example of how gaming is changing the world is virtual land. Decentraland and The Sandbox enable on virtual land ownership, which is very similar to physical land. Players can rent their land to other players, build on the land, or simply speculate on its value. Also, digital asset owners in Decentraland can vote on in-game organizational policies based on the total number of MANA assets they own. The more MANA the player owns, the the greater voting power the player controls in the DAO. The decentralized self-governance structure of Decentraland is starkly different than centralized games today. Players have the ability to govern and influence the project roadmap. Also, players are not subject to censorship or unjust bans.

“If they help create part of the value of the gaming universe, maybe they should have a piece of it. I think this is just a next chapter in what our relationship is with our digital lives and the digital items that we accumulate. The idea of giving true ownership of these assets so that these assets are not siloed to one game environment or one server, and actually have real liquidity and value and can be traded, allows these players to actually earn and buy their way to the top. It's pretty exciting. It's kind of incredible how big this market is already,” said Yash Patel of Telstra Ventures.

Gaming Is Attracting Venture Capital

Solana Ventures, Forte, and Griffin Gaming Partners announced a $150 million investment in blockchain gaming in December 2021. Their goal is to invest in Web3 game developers who are building decentralized games on the Solana blockchain. Griffin Gaming Partners manages one of the largest gaming investment funds, and Forte is leader in gaming infrastructure and regulatory compliance. Griffin has invested over $400 million into gaming and Web3 gaming-related companies over the past two years. Griffin is backed by over a dozen of the world's premier gaming, media, and technology companies across Europe, the U.S., Asia, and the Middle East.

“Blockchain is enabling publishers to engage with their player bases in innovative ways. Where game developers once had to continuously create new content for players to consume as one-time purchases, with the advent of NFTs and other blockchain technologies, game developers can now offer their audiences real property rights and create self-sustaining and thriving economies within their games,' said Forte CEO Josh Williams. “Solana further pulls the future of blockchain gaming forward, as its ultra-fast and low-cost solutions ensure scalability, even at tens of thousands of transactions per second, making building games on Forte with Solana feasible and cost-effective for both developers and players. We are also honored to partner with Griffin Gaming Partners, which has an exemplary reputation in working with publishers to build the most forward-looking titles in the games industry”

In November 2021, Solana Ventures, FTX and Lightspeed announced a $100 million blockchain gaming fund. The fund will invest in Solana gaming projects. The fund has already made its first investment in Faraway, a Solana gaming company.

Gaming Requires Fast And Cheap Blockchains

GameFi requires fast transaction processing and low network fees. According to GameFi.to, Binance Smart Chain (BSC) has the most on-chain games, followed by Ethereum and Solana. Axie Infinity launched on Ethereum in late 2021 and led to very strong growth of almost 10 million new users in one month. The game became so popular that it caused network congestion issues across all of Ethereum (the Ethereum network is capable of handling about 15 transactions per second – this compares to Solana at 60,000 transactions per second).

Ethereum will be the universal settlement layer, but it's not a place where you can run highly-performant applications,' said Jeff Zirlin, Sky Mavis co-founder and Growth Lead.

In 2022, gaming developers accelerated their pivot to lower cost blockchains with higher throughput such as Solana and BSC. Currently the Solana Ecosystem lists about 280 games. This number number has grown from single digits in one year. Solana and BSC are much cheaper than Ethereum, where an average transaction currently costs a few dollars vs BSC and Solana at less than a penny. Ethereum fees reached several hundred dollars per transaction in late 2021 during the cryptocurrency peak. The high fees and congestion issues led more developers to move to BSC and Solana.

Outlook

The rapid success of Axie Infinity in 2021 caught the attention of venture capital and game developers. We will see a continued influx of games over coming years as gamers demand Web3 blockchain applications.

The post How Blockchains Will Change The Gaming Industry appeared first on Datafloq.

Should retail investors be jumping into crypto trading right away? Our answer will surprise you! We're going to share our two cents worth on this topic after looking at some real-life examples below.

How to Make Your Crypto Trading Strategy?

It is a good practice to keep track of your trading activity.

If you are confident in the crypto assets you have chosen, it is advisable to keep them in your portfolio. Diversification is not only about the number of assets but also about trading strategies.

If you want to understand how cryptocurrencies work, imagine the following example. A friend asks you if they can borrow your car so they can drive their friend home from work (since their car is broken).

You agree and tell them where your garage key is so they can get in and start up the engine before going off on their adventure. But wait'what if your friend decides not to return?

Do you have any way of knowing whether or not he'll give it back? What if he has lost his keys? Or maybe somebody stole them from him'or worse yet. Maybe someone got into his house while he was sleeping last night and stole both his keys and his wallet with all its contents!

So, it is essential to evaluate the pros and cons of the situation before diving into anything.

The same goes with your investments to seek value from the cryptocurrency markets. You may get lured by the appreciating cryptocurrency prices. However, if you are looking to create cryptocurrency value that you can reap over the years, you have to have a strategy in place.

Being Aware of the Risks

Investing in the crypto market is risky, which means that you should get prepared to lose some or all of your investment.

You can never predict the future of any market and its value will fluctuate based on several factors. It can include

• The markets perception of the coin's utility
• Its popularity among investors
• Technological advancements
• New developments in its code.

Make sure you do thorough research before investing. This way you know what you are getting yourself into. What risks are involved, and how much you can afford to lose if things don't go as planned.

Keeping It Simple

As you start in the crypto market, you need to keep things simple. You will find that most professional traders and investors have the same strategy: they only trade when they see a clear signal. Many traders make money by simply following this rule.

For example, say someone wants to buy Bitcoin (BTC). They shouldn't think about how much fiat currency they have in their bank account and then decide whether or not they can afford 1 BTC.

They should ask themselves what kind of signal indicates that now is a good time for investment in BTC? The answer may be different depending on which type of investor you are'a short-term or long-term one. However, regardless of which type you are, there should always be an indicator telling us when we can buy bitcoin rather than blindly buying it at any price just because we think it's going up every day!

Developing a Plan for Every Trade

Determining risk and reward. When making trades, you need to keep in mind the amount of money you're willing to lose on each trade. You should also have a system of determining whether or not a given trade is worth taking.

Set stop-loss orders. If your stop-loss order is too low, then it may mean that your account will get wiped out if the price goes against you. If your stop-loss order is too high, it could take longer for you to reach your desired profit level. In either case, having too little or too much money tied up in an unprofitable position increases risk and reduces the chances of making profits in other positions.

Diversify

The most important rule of investing is to ”'don't put all your eggs in one basket”
. That is, don't put all your money into a single cryptocurrency or type of coin.

You may have heard the saying, ”'Don't put all your eggs in one basket”
. If something happens to that specific investment, you will lose everything! You must diversify across different coins and exchanges so that if one goes down, it won't take everything with it!

One way to diversify across coins is by using an aggregator like OKX. It allows users the ability to sort by market cap or name. The larger the number next to any given coin indicates its total value relative compared against other cryptocurrencies out there on exchanges worldwide. However, keep in mind that these numbers can change drastically based on current prices).

Take Care of Your Funds

A good trading strategy will help you take care of your funds. At the same time, it is a useful tool to deal with the emotional part of trading. It means that you should be able to stay calm and focused to make good decisions when needed, especially during periods of uncertainty or volatility.

If you can't find an easy way out of this situation, your strategy needs more work before it's ready for real-life scenarios. In general, though, I would advise against using complex strategies if they're not something that comes naturally to you. It is especially difficult because they require constant monitoring (and possibly adjustments) throughout the day or week.

Conclusion

In conclusion, it is important to understand what kind of trading strategy you are implementing. There are various types of cryptocurrency trading strategies, and they all have their pros and cons.

It's up to you to decide which one suits your goals best. You can also try several strategies at once if that is more suitable for your needs and preferences. Remember not to be greedy as this will lead you into losing money in the long run!

The post What Should Be the Crypto Trading Strategy for Retail Investors? appeared first on Datafloq.