Connect with us

Blockchain

Ampleforth: A Guide to the AMPL DeFi Protocol

Avatar

Published

on

Imagine the possibilities of reinventing money. One that is powered by blockchain and crypto-based solutions. That is what Ampleforth hopes to achieve within and beyond the crypto community.

Since the inception of decentralized finance (DeFi), various notable projects have spawned, giving life to a new sector in the cryptosphere. At the moment, investors and crypto traders alike are quite stoked with DeFi and liquidity mining.

We have witnessed several protocols like Maker, Aave, and Compound attracting hundreds of thousands of users, enabling the DeFi ecosystem to proliferate far and wide.

These revolutionary DeFi protocols provide users with investment options that they won’t normally be able to access with traditional loan systems. In DeFi systems, users are offered flash loans (no collaterals required), stablecoins that are collateralized, and interest rates that are subject to supply-demand functions.

One of the most promising projects that has turned a lot of heads lately is Ampleforth.

Table of Contents

Background

Ampleforth Founder Evan Kuo

The former CEO of Pythagoras Pizza, Evan Kuo thought of a way he could reinvent money and create something phenomenal. He started by tokenizing his pizzeria so everyone involved with the business earned tokens for completing different tasks. The tokens represented shares in the pizza company, as well as its profits.

The tokenization of Pythagoras Pizza attracted several investors and helped Kuo meet notable people within the crypto community. Through a team of brilliant academics, engineers, enthusiasts, and investors, the Ampleforth foundation was established.

What is Ampleforth (AMPL)?

The centralized finance system run by traditional finance institutions had a lot of challenges and shortcomings. The loopholes needed a solution, and decentralized finance came into being. However, DeFi is not as perfect as it is expected to be.

Ampleforth’s platform was created to have money reinvented while correcting the failures of Cefi and improving upon existing DeFi protocols.

Unlike in other DeFi platforms, users are not motivated to use the Ampleforth blockchain for liquidity mining purposes. However it’s token, AMPL, is an attractive asset for yield farming due to its stable value. The value of each token is pegged to the 2019 dollar only, meaning it is no longer subject to U.S. inflation.

Furthermore, an equilibrium range between $0.96 and $1.06 is hardcoded into the smart contract in order for the token to keep its stability.

This provides an opportunity for users of the platform to make money through arbitrage. Depending on whether the price of AMPL moves up or down the equilibrium range, arbitrageurs can either sell excess AMPL to take profits or increase their holdings when the price drops.

Looking at the AMPL chart, traders could easily spot the enormous arbitrage opportunities in the Ampleforth system.

The Ampleforth System

This Ethereum blockchain-based ecosystem has some unique features like its adaptability in supply. Ampleforth was designed to alter the supply in circulation, based on the forces of demand. This means that when there is an increase in the demand of Ampleforth, the supply will also experience increase. When there is a drop in the demand for Ampleforth, it also affects the supply.

There is the tendency for Ampleforth to get confused for a stablecoin, but that is not the case. Ampleforth has no fiat nor crypto backing it, which makes it different from a standard stablecoin.

The Ampleforth protocol boasts autonomy; however, the system is not as decentralized as one would expect. It turns out that the team holds the power to pause any changes in the supply of AMPL, as well as freeze all user funds.

The foundation hasn’t made any known remarks regarding this and many users might not even be aware that the team still holds the key to the system.

Ampleforth Economics

At some point in history, the U.S. dollar was tied to the value of gold. This monetary system was known as the gold standard, and in 1971, the U.S. made a switch away from the gold standard. The U.S. had to make that move because they could not afford to deal with deflation.

With fiat currency, shortcomings like fraud and supply adjustment could not be avoided. This is where the Ampleforth protocol comes in with a solution that autonomously adjusts supply based on demand.

The Ampleforth protocol is designed to get information about current exchange-rates from reliable Chainlink oracles. Holders of the Ampleforth units are facilitated by proportionally decreasing or increasing the number of tokens held by each investor.

For traders within the ecosystem, the changes in quantity and exchange-rate mean there are changes in Ampleforth’s market cap. Short-term traders, especially those that employ algorithmic or automated solutions, will be able to discover new trading strategies.

Interestingly, the behavior of a trader is expected to create a movement system that is step-function-like. This is based on their response to the incentives provided by the protocol, with lesser correlation to existing digital assets. With this operational framework in place, Ampleforth is suited for traders and investors looking for long, medium, or near term utilities.

Use Cases

At the center of AMPL’s utility is the creation of an exchange medium. Ampleforth has the ability to scale supply in order to match with the demands of users in their billions. Furthermore, supply can also be contracted if it has only about 2000 users being served.

The elastic supply of AMPL’s pattern makes it a good asset to facilitate the building of a digital ecosystem. This is the reason why it was created with this type of framework. It is ideal to be used as collateral for DeFi systems. It has a countercyclical feature that makes it a profitable addition to a diversified digital asset portfolio.

Ampleforth Geyser

Incentivization is an effective way to encourage investors and traders to get participate in a system. In this case, on-chain liquidity is incentivized with the aid of Ampleforth’s smart faucet called “Geyser”. Whenever liquidity is provided on the Uniswap platform, the liquidity provider will receive AMPL tokens as rewards.

How to use Ampleforth Geyser

  • If you are looking to earn by providing liquidity, follow these steps: open your browser and visit the Ampleforth Geyser portal.
  • Connect your Ethereum wallet using the “Connect” button. (if you don’t have an Ethereum wallet, you should create one)
  • Depending on the operation you want to perform, there are three buttons: Deposit, Withdraw and Stats.
  • To deposit, connect your wallet, enter the amount and tap the “Deposit” button to execute.
  • To withdraw, ensure that your Ethereum wallet is connected. It will withdraw your deposits and profits into your wallet.

Conclusion

To some considerable extent, Ampleforth has been able to redesign money. However, they have not been able to influence the mainstream potential users. They have what it takes to become a sought-after protocol.

Furthermore, they are making significant traction in the DeFi space and will likely continue to grow.

Interestingly, Geyser has seen an estimated 37 million AMPL being deposited, and that is a good indicator of its growth and potential. Things are looking up for the Ampleforth protocol, but they need to do more to stay relevant in the crypto community.

Users looking to get AMPL tokens can purchase them from various crypto exchanges like KuCoin, Uniswap, Bitfinex, and many more.

Source: https://www.asiacryptotoday.com/ampleforth-a-guide-to-the-ampl-defi-protocol/

Blockchain

Ethereum: Is the HODLing in yet?

Avatar

Published

on

When it comes to the altcoin market, the past few months have shown how important a cryptocurrency Ethereum is. With DeFi growing substantially in 2020, the gains have been felt by ETH in many ways. While ETH has miles to go before it can challenge the market cap and dominance of Bitcoin, its remarkable growth thanks to DeFi and the proposed ETH 2.0 shift cannot be overlooked. With Ethereum’s use cases diversifying, users and investors within the ecosystem are reaping its benefits too.

Source: Glassnode

According to recent network data provided by Glassnode, Ethereum balances on centralized exchanges have fallen substantially over the past few weeks. In fact, the aforementioned data showed a drop from over 18,750K to around 16,750K, resulting in Etherum balances on exchanges falling to their lowest level for the year 2020, at the time of writing.

While this drop may seem alarming to some, it also illustrates a silver lining of sorts for the cryptocurrency. A fewer number of users are now holding their Ethereum on exchanges. Instead, they are moving them to cold storage or cold wallets – a sign commonly associated with increased hodling sentiment. As more users hold on to their Ethereum, the price of the cryptocurrency is also likely to be positively impacted.

One of the reasons why many users are feeling inclined to do so can be due to its recent performance, as well as its ability to derive growth from a booming DeFi ecosystem that is based on its platform.

Source: Glassnode

In fact, it is also interesting to note that over the same timeframe, Ethereum addresses with greater than 10 ETH have also seen a significant rise. According to network data provider Glassnode, such addresses have risen from 275K to 283K in the last three months alone.

One of the key reasons behind the aforementioned drop in Ethereum stored on exchanges ties back to increased hodling sentiment within the Ethereum community, as highlighted above. This, coupled with a rise in Ethereum locked in smart contracts (Since investors are looking to generate greater returns at a time when Etherum’s price is consolidating on the charts), bodes well for the cryptocurrency’s ecosystem.

Source: https://eng.ambcrypto.com/ethereum-is-the-hodling-in-yet

Continue Reading

Blockchain

Brace for it – Bitcoin Futures may be nearing a tipping point

Avatar

Published

on

What’s the tipping point for Bitcoin Futures on top derivatives exchanges like the CME, an exchange that has recorded a daily trading volume of over $300M and Open Interest of over $400M, consistently, for the past 3 months. 

Inching closer to the tipping point of Bitcoin Futures

Source: Skew

Well, a small shift in Open Interest or trading volume can have a cascading effect on Bitcoin Futures’ performance in the next 180 days. Such a shift will be influenced by several factors, and it begins at the tipping point. Three factors, to be more specific. 

In the current phase of Bitcoin’s market cycle, these factors are more relevant for traders on derivative exchanges. This becomes more evident when the Liquidations chart for BitMEX is observed. Over the past 3 months, sell liquidations have paid for buy liquidations. However, over the last few days, this trend has been reversed, and buy liquidations have covered for sell liquidations on BitMEX.

Inching closer to the tipping point of Bitcoin Futures

Source: Skew

The point here is to detect the source of the domino effect before the dominoes start falling. In the case of Bitcoin Futures, the tipping point may be closer than anticipated. 

One of the top factors influencing the tipping point is the Law of the Few. 

The Law of the Few states that “the success of any kind of social epidemic is heavily dependent on the involvement of people with a particular and rare set of social gifts.”

In the case of Bitcoin, institutional investors, derivatives traders, and whales fit the bill. The success of Bitcoin Futures in the global trading community heavily relies on institutional investors trading on CME. In fact, the daily trade volume and Open Interest on CME influence the trading sentiment across spot exchanges as well. 

The last time a cascading effect was witnessed was when BTC Futures’ Daily Trading Volume hit $445M on CME and there was a rally all the way up to $614M. At the time of writing, the Daily Trading Volume was up 63.3%, when compared to the figures 6 months ago, and it has the potential to hit $614M with one move in the right direction.

This effect heavily relies on another key factor – The Stickiness Factor.

Back in 2017, when Google search results for “Bitcoin” and “Crypto” broke the record, the trading community witnessed a historic Bitcoin bull run and altcoin rally. Institutional interest and growth of Bitcoin derivative products ensued. A similar event transpired when Bitcoin Futures’ aggregated daily volume hit $184B on 27 July 2020. This event was a unique occurrence, and it made Bitcoin Futures stick in the portfolio of the average institutional investor and the derivatives trader.

Inching closer to the tipping point of Bitcoin Futures

Source: Skew

The aggregate trade volume hasn’t dropped to pre-July 2020 levels since then. Despite drops in Bitcoin’s price on spot exchanges, Futures contracts continue to trade at a premium and there is more optimism. Volume is not directly impacted by Bitcoin’s price and when the spot market is riddled with bearish sentiment, long contracts continue feeding shorts on BitMEX. This stickiness is a driver of the aforementioned tipping point. 

Inching closer to the tipping point, the powerful context is the rise of stablecoins and their instrumental role in lowering the barrier to entry on spot and fiat-crypto exchanges.

Over the past three months, stablecoins like USDT have added $100M in volume every day and their market capitalization and dominance have risen tremendously. In fact, Tether has also crossed a market capitalization of $15B.

This directly influences the tipping point for Bitcoin Futures as it makes Futures trading more accessible to traders. Bitcoin held on exchanges has nearly doubled over the past month, corresponding to an increase in Tether’s market capitalization and circulation. This resonates with derivatives traders who opt for physically-settled Bitcoin Futures contracts on exchanges like Bakkt. In fact, on Bakkt, the daily trade volume was upwards of $80M for the past week, while the Open Interest has been consistently above $10M.

Inching closer to the tipping point of Bitcoin Futures

Source: Skew

All of these factors are highlighting a shift in derivatives traders’ strategy, while also underlining increased activity on derivatives exchanges. The race to the tipping point has begun – An increase in aggregate trading volume on physically-settled Futures contracts or CME may trigger the much-awaited domino effect.

Source: https://eng.ambcrypto.com/brace-for-it-bitcoin-futures-may-be-nearing-a-tipping-point

Continue Reading

Blockchain

Tron, Synthetix, VeChain Price Analysis: 19 September

Avatar

Published

on

Tron was observed to have hit a strong zone of resistance, before being rejected and pushed to the downside, at the time of writing. In fact, such bearish momentum appeared likely to continue for TRX. At a time when Ethereum was increasingly being criticized for high Gas fees and a congested network, it could have been Tron’s moment to shine, but things didn’t pan out that way at all.

Further down the charts, Synthetix continued making lower highs in its downtrend while VeChain broke out upwards after a few days of relative calm.

Tron [TRX]

Tron, Synthetix, VeChain Price Analysis: 19 September

Source: TRX/USDT on TradingView

TRX was seeing oversold conditions a few days ago when its RSI hit a low of 23, before ascending just past 50. However, the RSI was unable to remain above 50, and its drop beneath the level highlighted the fact that TRX’s recent 12% surge from $0.263 to $0.296 was merely a bounce.

TRX found a zone of strong resistance at $0.3 and looked likely to drop towards the support at $0.265.

Interestingly, a recent Reddit post has raised questions about JustSwap’s vetting process, claiming that the Tron Foundation has whitelisted a DeFi project that has since pulled a $2 million exit scam. This, despite DappRadar listing the project as “high-risk.”

Synthetix [SNX]

Tron, Synthetix, VeChain Price Analysis: 19 September

Source: SNX/USD on TradingView

Synthetix underlined the possibility of dropping lower on the charts. The Directional Movement Index did not yet show a strong trend, but ADX (yellow) was inching towards 20 and could move further north. Also, the rising -DMI (pink) denoted a bearish trend.

Over the past week, every SNX bounce off the level of support has been overwhelmed by selling pressure. This can be expected to continue. With the price registering lower highs, the way down remained the path of least resistance for SNX.

The next level of support after $4.23 lay at $3.36, representing a 20% depreciation.

VeChain [VET]

Tron, Synthetix, VeChain Price Analysis: 19 September

Source: VET/USD on TradingView

VeChain showed bullishness in the market after a period of consolidation. The Bollinger Bands expanded to indicate heightened volatility, while the price broke out towards the upper band. At the time of writing, the price was staying above the 20-period moving average, a moving average that could be tested as support as VET steadily climbs toward its resistance around the $0.158 zone.

The breakout was also accompanied by high trading volumes, legitimizing the breakout.

Source: https://eng.ambcrypto.com/tron-synthetix-vechain-price-analysis-19-september

Continue Reading
Blockchain1 day ago

Ethereum: Is the HODLing in yet?

Nano Technology1 day ago

Physicists make electrical nanolasers even smaller

Nano Technology1 day ago

Nano-microscope gives first direct observation of the magnetic properties of 2D materials: Discovery means new class of materials and technologies

Nano Technology1 day ago

Who stole the light? Self-induced ultrafast demagnetization limits the amount of light diffracted from magnetic samples at soft x-ray energies

Blockchain1 day ago

Brace for it – Bitcoin Futures may be nearing a tipping point

Blockchain2 days ago

Tron, Synthetix, VeChain Price Analysis: 19 September

Blockchain2 days ago

Here’s why Bitcoin’s ‘distracting’ volatility actually helps

Blockchain2 days ago

Stellar Lumens, NEM, Maker Price Analysis: 19 September

AR/VR2 days ago

Someone Remade ‘Among Us’ in VR and It’s Strangely More Fun Than the Original

AR/VR2 days ago

Virtual Tours: The Key to a Successful School Marketing Plan

Crowdfunding2 days ago

Spanish Financial Giant BBVA’s US Division Recognized as one of the Best Corporate Digital Banks in North America

Gaming2 days ago

Evening Reading – September 18, 2020

AI2 days ago

7 Awe Inspiring AI Techs That Transformed The Digital World

Entrepreneur2 days ago

100X.VC Unveils Its Class 02 Investments

Payments2 days ago

Here’s how Nasdaq-listed MicroStrategy went about buying $175m in Bitcoin

Esports2 days ago

Lenovo Legion Sponsors G2 Esports as Hardware Partner

CNBC2 days ago

Supreme Court Justice Ruth Bader Ginsburg dies at age 87

Energy2 days ago

Shanghai Electric Showcases Smart Energy Solution at China International Industrial Expo on World’s Clean Up Day

Entrepreneur2 days ago

Preventive Healthcare Market Dilating in India

Cannabis2 days ago

5 weed products Tommy Chong can’t live without

Gaming2 days ago

Shacknews Twitch Highlights: Rocket League, Fight Crab, and Quest 64

Entrepreneur2 days ago

More gets 275 Crore INR From Amazon, Samara Capital

Big Data2 days ago

TikTok filed a complaint against Trump administration to block U.S. ban: Bloomberg News

Blockchain2 days ago

Seoul Police Summons Bithumb Chairman For Interrogation

Cyber Security2 days ago

6 Crucial password security tips for everyone

CNBC2 days ago

‘Thank you, RBG’: Leaders react with sadness, shock to Ruth Bader Ginsburg’s death

Gaming2 days ago

Shack Chat: What’s your reaction to the September PlayStation 5 Showcase?

Cleantech2 days ago

Ford Mustang Mach-E Easily Goes 300+ Miles In Norway

Gaming2 days ago

Apple and Sony Events – The TouchArcade Show #462

Esports2 days ago

Here’s the schedule for the 2020 League of Legends World Championship

Gaming2 days ago

Weekend PC Download Deals for Sept. 18: Steam Pirate Sale

Gaming2 days ago

Shacknews Dump – September 18, 2020

Crowdfunding2 days ago

India-Based Insurtech ACKO Secures $60 Million Through Latest Funding Round Led By Munich Re Ventures

Crowdfunding2 days ago

Google Temporarily Removes Paytm Mobile App from Play Store Due to Supposedly Being in Violation For Gambling

Gaming2 days ago

TouchArcade Game of the Week: ‘Songbringer’

CNBC2 days ago

In Photos: Crowd gathers in front of the Supreme Court to mourn Justice Ruth Bader Ginsburg

CoinTelegraph2 days ago

Pinned below $11K, Bitcoin price plays second fiddle to Uniswap (UNI)

CNBC2 days ago

Trump nominee to replace Ruth Bader Ginsburg on Supreme Court will get Senate vote, McConnell says

Cleantech2 days ago

Indian Government May Put EV Chargers At 69,000 Gas Pumps

Blockchain2 days ago

The Last Time This On-Chain Metric Was This Low, Bitcoin Surged 150%

Trending