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The Convergence of Cryptocurrencies and AI: The Future of Money

JC Keen
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0
The Convergence of Cryptocurrencies and AI: The Future of Money

Cryptocurrencies and artificial intelligence (AI) are two groundbreaking technologies that are shaping the future of money and revolutionizing industries. The convergence of these two fields brings forth a myriad of possibilities, from enhancing financial transactions and security to enabling intelligent decision-making and automation. In this article, we will explore the synergies between cryptocurrencies and AI, examine real-world examples of their applications, and delve into the challenges that need to be addressed for this convergence to reach its full potential.

Fraud Detection and Security:

AI can play a vital role in bolstering the security of cryptocurrency transactions. Machine learning algorithms can analyze vast amounts of transactional data to detect suspicious patterns and identify potential fraud. By continuously learning from historical data, AI-powered systems can enhance security measures, reduce the risk of unauthorized activities, and provide a robust defense against cyber threats in the cryptocurrency ecosystem.

Example: AI-powered platforms like Chainalysis leverage machine learning algorithms to trace the flow of cryptocurrencies, identify illicit activities, and support law enforcement agencies in combating money laundering and illicit transactions.

Market Analysis and Predictive Insights:

AI technologies can analyze market trends, sentiment analysis, and historical data to provide valuable insights for cryptocurrency investors. By processing vast amounts of data, AI algorithms can detect patterns, predict market fluctuations, and help investors make informed decisions. Sentiment analysis algorithms can analyze social media and news sentiment to gauge market sentiment, identify emerging trends, and provide predictive analytics.

Example: Cryptocurrency trading platforms like CryptoCompare leverage AI algorithms to provide real-time market data, sentiment analysis, and predictive insights to traders, enabling them to make more informed investment decisions.

Smart Contracts and Automation:

Smart contracts, powered by blockchain technology and AI, have the potential to revolutionize contractual agreements. AI algorithms can be integrated into smart contracts to automate complex decision-making processes and enable self-executing contracts. These smart contracts can automatically trigger actions based on predefined conditions, eliminating the need for intermediaries and streamlining transaction processes.

Example: Ethereum, a blockchain platform, enables the creation of decentralized applications (DApps) that leverage smart contracts. These DApps automate various processes, such as decentralized finance (DeFi) lending and borrowing, decentralized exchanges, and more.

Enhancing Wallet Security:

Wallet security is of utmost importance in the world of cryptocurrencies. AI can contribute to strengthening wallet security by implementing advanced encryption techniques, anomaly detection algorithms, and behavioral analysis. This helps protect users’ digital assets, mitigates the risk of hacking, and ensures a secure environment for storing and transacting cryptocurrencies. Projects like Trezor, a hardware wallet, utilize AI-backed security features to safeguard users’ private keys and provide an additional layer of protection.

Decentralized Applications (DApps):

The emergence of decentralized applications, or DApps, built on blockchain technology has opened up new possibilities for various industries. AI can enhance DApps by providing intelligent functionalities, such as personalized recommendations, data analysis, and machine learning algorithms. These AI-powered DApps offer improved user experiences and unlock innovative use cases, ranging from decentralized finance to supply chain management. For instance, projects like SingularityNET aim to create a decentralized AI network that enables collaboration and the development of AI-powered DApps.

Challenges Related to Cryptocurrencies and AI

Scalability and Speed:

Cryptocurrencies, such as Bitcoin and Ethereum, face scalability challenges when processing a large number of transactions. As AI applications and adoption grow, the demand for faster transaction processing becomes critical. Overcoming scalability issues while maintaining the decentralized nature of cryptocurrencies is a significant challenge that requires innovative solutions.

Regulatory Landscape:

Cryptocurrencies operate in a complex regulatory landscape. Governments and regulatory bodies are grappling with creating clear guidelines and frameworks to govern cryptocurrencies and AI applications. Balancing innovation and consumer protection while addressing potential risks, such as money laundering and fraud, poses challenges in developing effective regulatory frameworks that encourage growth and innovation while mitigating potential threats.

Trust and Security:

Building trust and ensuring security in the cryptocurrency and AI space is crucial. Cryptocurrencies are susceptible to hacking, fraud, and theft. AI systems can also be vulnerable to attacks and malicious use. Establishing robust security measures, including encryption, secure key management, and decentralized infrastructure, is essential to protect user assets and maintain trust in the system.

Data Privacy and Ethics:

The convergence of cryptocurrencies and AI raises important considerations regarding data privacy and ethics. As AI technologies require vast amounts of data, it is crucial to protect user privacy and ensure that data is handled securely. Ethical frameworks should be established to govern the use of AI in cryptocurrencies, addressing concerns related to transparency, bias, and discriminatory outcomes. Striking a balance between the benefits of AI and preserving user privacy and ethical practices is essential for fostering trust in this convergence.

Challenge: Balancing the need for transparency and accountability with user privacy is a critical challenge. Regulatory frameworks must ensure that AI-powered cryptocurrency systems adhere to privacy regulations and ethical standards.

Interoperability and Standards:

Interoperability among different blockchain networks and AI platforms is crucial for seamless integration and collaboration. However, achieving interoperability and establishing common standards across disparate systems pose challenges. Overcoming these challenges requires collaboration between industry stakeholders, standardization bodies, and open-source initiatives to ensure interoperability and promote the development of universally compatible systems.

Education and Awareness:

Increasing education and awareness about cryptocurrencies and AI technologies is essential for their widespread adoption. Many people still have limited knowledge and misconceptions about these technologies. Providing accessible educational resources, fostering innovation-friendly environments, and promoting awareness campaigns are necessary to overcome the barriers of understanding and create a knowledgeable user base.

Addressing these challenges requires collective efforts from industry leaders, researchers, policymakers, and the wider community. By addressing scalability, regulatory clarity, trust, ethics, interoperability, and education, we can unlock the full potential of the convergence between cryptocurrencies and AI, paving the way for a future where intelligent financial systems transform our daily lives.

Conclusion:

The convergence of cryptocurrencies and AI represents a transformative force that is reshaping the future of money. From fraud detection and market analysis to smart contracts and automation, the applications are far-reaching. However, challenges such as data privacy, ethics, and adoption must be addressed

10 Steps to Secure Your Bitcoin Investments in 2023: Enhancing Investment Security

JC Keen
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0
10 Steps to Secure Your Bitcoin Investments in 2023: Enhancing Investment Security

Introduction

In 2023, ensuring the security of your Bitcoin investments has become paramount. As the value of Bitcoin continues to rise, so does the risk of theft and unauthorized access. To safeguard your digital assets, it is crucial to implement effective security measures. This article provides you with ten essential steps to secure your Bitcoin investments in 2023, offering peace of mind and protecting your financial future.

Step 1: Choose a Secure Wallet:

Select a wallet that suits your needs and provides robust security features. Cold wallets, such as hardware wallets, offer offline storage and enhanced protection against online threats. Hot wallets provide convenience but ensure you opt for reputable providers with strong security measures.

Step 2: Safeguard Your Seed Phrase:

Your seed phrase is the key to accessing your Bitcoin wallet. Store it offline in a secure location and avoid any digital exposure. A physical backup, written on paper, is highly recommended.

Step 3: Implement Strong Passwords and Two-Factor Authentication (2FA):

Create strong, unique passwords for your Bitcoin accounts. Utilize a password manager to generate and securely store complex passwords. Enable 2FA to add an extra layer of protection to your accounts, reducing the risk of unauthorized access.

Step 4: Be Cautious of Phishing Attempts:

Remain vigilant against phishing attempts that aim to deceive and steal your Bitcoin. Avoid clicking on suspicious links, verify website URLs before entering sensitive information, and be cautious of unsolicited communications. Trust official sources and never share your private keys.

Step 5: Stay Informed about Security Best Practices:

Stay updated on the latest security best practices in the Bitcoin community. Engage with reputable sources, forums, and online communities to gain insights into emerging threats and effective protective measures.

Step 6: Regularly Back Up Your Wallet:

Frequently back up your Bitcoin wallet to ensure you can recover your funds if your device is lost or compromised. Store backups in multiple secure locations, utilizing encryption and offline storage options.

Step 7: Utilize Hardware Wallets and Cold Storage:

Consider using hardware wallets, which provide secure offline storage for your Bitcoin. Hardware wallets keep your private keys offline, safeguarding them from potential online threats. Store them in a physically secure location, such as a safe or vault.

Step 8: Use Firewall and Antivirus Software:

Protect your devices and online activities by using a reliable firewall and up-to-date antivirus software. These security measures help prevent malware and unauthorized access to your Bitcoin wallet.

Step 9: Exercise Caution with Public Wi-Fi:

Avoid accessing your Bitcoin accounts or conducting transactions over public Wi-Fi networks. Public networks may lack adequate security measures, making them vulnerable to eavesdropping and hacking attempts. If necessary, use a virtual private network (VPN) for secure connections.

Step 10: Continuously Educate Yourself about Bitcoin

Security: Stay proactive in your understanding of Bitcoin security by continually educating yourself. Stay updated on emerging threats, new security features, and industry best practices. Expand your knowledge through reliable online resources, tutorials, and expert insights.

Conclusion:

In 2023, securing your Bitcoin investments is vital to protect your digital wealth By following these ten steps, including selecting secure wallets, implementing strong passwords and 2FA, staying informed about security best practices, and utilizing cold storage options, you can enhance the safety of your Bitcoin holdings. Stay cautious, adapt to changing security landscapes, and protect your financial future in the world of cryptocurrencies.

What Is Evrmore? A Simple Solution For Decentralized Finance

JC Keen
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0
What Is Evrmore? A Simple Solution For Decentralized Finance

What is Evrmore?


Evrmore (EVR) is a new blockchain with a simple solution for decentralized finance (DeFi). EVR is a fork of the Ravencoin blockchain, which relies on the use of primitives for the creation and transfer of digital assets. The use of asset primitives combined with newly added functionality will allow EVR to provide a simple DeFi solution without the flaws inherent to general purpose smart contracts. See Evrmore’s whitepaper.


What is the Relationship Between Evrmore and Ravencoin?


The idea of Evrmore originated within the Ravencoin development community. The two blockchains share similar ethos, which explains why EVR is also an open source, Proof of Work (PoW), decentralized blockchain. Evrmore was launched on October 31, 2022 as a friendly fork of Ravencoin. On launch day the top 50,000 Ravencoin wallets became eligible to claim Evrmore at a rate of 1 EVR for 1 RVN. As a result, Evrmore instantly gained the attention, and in many cases the support, of the Ravencoin community.


Is Evrmore in Competition with Ravencoin?


Evrmore does not aim to replace Ravencoin, but rather co-exist while participating in a different niche – Decentralized finance. The friendly relationship between these two projects provides for a somewhat symbiotic relationship, where Evrmore benefits from all of Ravencoin’s code design to date. Whereas Ravencoin benefits from any code innovation introduced by Evrmore it chooses to adopt.


What is the difference Between Ravencoin and Evrmore?


Ravencoin was designed specifically for the purpose of tokenizing and transferring digital assets, utilizing blockchain technology. RVN natively supports assets in a much more efficiently manner than projects like Ethereum, which utilize general purpose smart contracts. Evrmore aims to participate in the DeFi space by providing enhancements not envisioned in Ravencoin’s road map. In short, EVR will be capable of providing DeFi functions such as partial order fulfillment, stop-limit orders, interest rates, options and futures contracts, and many other useful financial primitives.


Complex and Vulnerable Smart Contracts Vs Simple and Secure Primitives


Although general purpose smart contracts are hugely popular, these are unnecessarily complex and introduce security risks and endless vulnerabilities. When it comes to tokenization, smart contracts are the wrong tool. Fortunately, asset tokenization can be handled simply and more securely by utilizing Bitcoin’s UTXO protocol design to handle assets – natively supported asset primitives.


A Better User Experience


When creating an asset using Ravencoin or Evermore, no coding or programming is necessary. The user simply fills in pre-defined information such as the name of the asset, the type of the asset, the number of units, etc. When using Evrmore’s DeFi features, the same simple user experience can be expected.

Evrmore Asset Creation

How can I buy Evrmore?


The easiest way to buy Evrmore is to transfer cryptocurrency (i.e. Bitcoin or Ravencoin) to Safe.trade, where you can exchange this crypto to EVR. Safe.trade is a non-KYC crypto marketplace.

How do I mine Evrmore?


Although EVR uses a different algorithm that Ravencoin, it shares many similarities. This means that if you are already familiar with mining Ravencoin, you can easily mine Evrmore. Below is a video by Jake Jaboreli on how to mine Evrmore.

Credit: Jake Jaboreli

Does Evrmore Support NFTs?

Yes, when Evrmore was launched it already had all the same functionalities Ravencoin has. This means users can mint main things like assets (think brand name), sub-assets (ideal for tokens and fungible assets), unique assets (NFTs) etc. The cost to create assets is as follows:

  • Main Assets – 500 EVR
  • Sub Assets – 100 EVR
  • Unique Assets – 5 EVR
  • Messaging Channel Assets – 100 EVR
  • Qualifier Assets – 1,000 EVR
  • Sub Qualifier Assets – 100 EVR
  • Restricted Assets – 1500 EVR

Where Can I Buy or Sell Evrmore NFTs?

EVRSea.io – a new marketplace for EVR NFTs launched this week. NFT artists and collectors still need to build the NFT ecosystem, but having an NFT marketplace within two weeks from launch is impressive.

Conclusion

Hopefully this article answered the question of what is Evrmore in sufficient detail. To learn more about evrmore visit https://evrmorecoin.org/ or join the community’s Discord server. If you hurry up you may be able to get your hands on an EVR OG CHIP!

FOR.EVR/EVR.OG.CHIP

Ravencoin Vs Bitcoin in 2022 – The Best POW Blockchains

JC Keen
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0
Ravencoin Vs Bitcoin in 2022 – The Best POW Blockchains

Online searches for Ravencoin vs Bitcoin in 2022 are on the rise. To be clear, there’s no competition between these two amazing Proof of Work (POW) blockchains. Bitcoin is the indisputable king when it comes to digital money. Ravencoin serves an entirely different purpose, tokenization.

People in the crypto space are familiar with Bitcoin, as it is the dominant cryptocurrency by far.  Most people are also aware that Bitcoin has had many forks, some of which have led to the creation of new cryptocurrencies.  Cryptocurrencies that originated from Bitcoin include Bitcoin Cash (BCH), Bitcoin SV (BSV), and Bitcoin Gold (BTG).

What many don’t know is that Ravencoin is also a fork of Bitcoin.  As such, Ravencoin inherited many of characteristics of the most dominant chain in the cryptocurrency space.  Like Bitcoin, Ravencoin is a peer-to-peer blockchain fully decentralized blockchain.   

Why was Ravencoin Created?

As great as Bitcoin is, it wasn’t optimized for creating and transferring assets.  Thus, Ravencoin (white paper) was created specifically for the purpose of natively recognizing assets, such as tokens.  This means that Ravencoin can handle the creation and transfer of assets at the base layer and without the need for smart contracts.  See 13 Best Assets to Tokenize On the Blockchain.

Ravencoin Vs Bitcoin

Let’s do a high-level comparison of these two blockchains.  Here’s a Ravencoin Vs Bitcoin chart, as of 2022.

RavencoinBitcoin
Ticker SymbolRVNBTC
Primary Use CaseTokenizationDigital money
Launch DateJanuary 3, 2018Jan 3, 2009
Consensus MechanismProof of WorkProof of Work
Blockchain Accounting ModelUTXOUTXO
Total Maximum Supply21 billion21 million
Block Reward2,500 RVN6.25 BTC
Block Time1 minute10 minutes
Block Size Limit2MB1MB
MinersGPU Miners – ASIC ResistantASIC Miners
Asset HandlingAsset AwareNot Asset Aware
Other FeaturesFair LaunchFair Launch
No Pre-MineNo Pre-Mine
True Open SourceTrue Open Source
Not a SecurityNot a Security
Ravencoin Vs Bitcoin

For more about RVN, including the block reward schedule see Ravencoin Tokenomics.

The bottom line is that Ravencoin Vs Bitcoin shouldn’t be a thing. Rather, Ravencoin is a fork of Bitcoin. Ravencoin is a decentralized POW blockchain, but created specifically for the purpose of handling digital assets – asset tokenization.

Commonly Asked Ravencoin Questions

How much will Ravencoin be worth in 5 Years

No one can answer this question with any degree of certainty.  What is known is that Ravencoin has been successful at becoming a truly decentralized cryptocurrency.  This is in part due to its anti-ASIC mining algorithm.  A large number of Ravencoin miners are regular people with a gaming computer capable of mining RVN.  This has led to the creation of a passionate community that strongly believes in Ravencoin’s tokenomics. 

In addition, the use case for Ravencoin is beginning to resonate in the investment space.  The market for tokenization is humongous.  Few cryptocurrencies are competing for this space, and out of these only Ravencoin handles assets at the base layer, without smart contracts. 

Based on this, it isn’t difficult to imagine Ravencoin becoming a top 10 cryptocurrency by market cap within the next 5 years.  For that to be the case, Ravencoin would need to be worth about $1.25.  That’s 35X based on today’s price. 

Will Ravencoin Reach 1 USD?

With cryptocurrencies nearly everything is possible.  I’d say that is possible for Ravencoin to reach the 1 USD mark, within the next five years, based on the logic mentioned above. 

Is Ravencoin a Bitcoin?

Definitely not.  As mentioned earlier, Ravencoin is a fork of Bitcoin that is optimized for handling digital assets.

Should I invest in Ravencoin?

Investing in cryptocurrencies is hardly an investment, but rather a speculation.  If you have extra money to speculate with, Ravencoin may be one of the better options at the current prices.  See also 10 Reasons to Invest in RVN.

What Makes Ravencoin Special?

What makes Ravencoin special is that it was designed specifically for tokenization.  You can tokenize anything, including stocks, real estate, collectibles and more.  To my knowledge no other coin was designed specifically for this purpose.  See Which Is The Best Tokenization Crypto. For this reason, Ravencoin handles assets extremely efficiently and without the need for smart contracts.  As many know, smart contracts can introduce many vulnerabilities that can lead to major losses.

Is Mining Ravencoin worth It?

For most of 2022 Ravencoin has been second in GPU mining profitability only to Ethereum.  And in the next few days Ethereum is going to switch from POW to POS.  In short, miners all over the world will either cease mining or will switch their rigs to some other crypto.  Ravencoin is poised to greatly benefit from this event. That’s because more hashrate will migrate from Ethereum to Raencoin, increaseing the security of the Ravencoin network.

Is Ravencoin an NFT?

No, Ravencoin is not an NFT, but it is arguably the best cryptocurrency to mint and trade NFTs.  With Ravencoin, NFTs are handled similarly to transfers of Bitcoin from one wallet to another.  This means that with Ravencoin you have true ownership of your NFT, rather than relying on a smart contract that can be modified at anytime by its creator. See Not your keys, not your NFTs.

Why is Ravencoin Going Up?

One of the reasons Ravencoin is going up is because Ethereum is switching from POW to POS.  As such, many miners are looking for the next best coin to mine.  One of the best and most profitable options is Ravencoin.

Who is the CEO of Ravencoin?

Ravencoin is not a company.  Therefore it has no CEO.  There’s an insider joke among Ravenites where people claim to be CEOs or people of influence within RVN.  But that’s just a joke.

Will Ravencoin go to Coinbase?

In my view Coinbase will have no choice but to list Ravencoin at some point.  However, don’t hold your breath.  The Ravencoin community submitted all the documentation required for Coinbase and other cryptocurrency marketplaces (i.e. Gemini) to be listed, but for some reason or another that hasen’t happened yet.

Stunning New Project META-Z by Artist Joaquin Chabers

JC Keen
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0
Stunning New Project META-Z by Artist Joaquin Chabers

Metaverse project Meta-Z by Artist Joaquin Chabers is a stunning work of art. Joaquin graciously agreed to answer a few questions about himself and about his ongoing Meta-Z project.

What can you share about yourself?

Hello Ravenites! First of all, I’d like to express my gratitude to each and everyone of you. Ever since I joined this vibrant community, you showed me nothing but support, guidance, and encouragements.

The name’s Joaquin, born and raised in the south of France. Throughout my life I was fortunate to travel, study and work in many places around the globe; The United States, England, and Germany to mention a few. My occupation for the past 20 years was a Physics teacher which I loved and enjoyed. I also worked as a part-time software engineer and gained a lot of experience that helped shape my interest in creating art.

Nowadays, I am back to my roots, to the family’s farm carrying out my father’s legacy and embracing this new & reviving journey in the crypto space as an NFT artist and an aspiring filmmaker.

When did you discover you were into art?

My interest in art has always lingered within ever since I was young. One of the fundamental moments that sparked my love for both physics and art was when I visited a science & space museum with my schoolmates at the age of 14 years old, and was captivated by atoms and galaxies and how something so raw could be visualized in such an artistic manner.

How long have you been doing digital art?

Throughout my twenties and thirties I was doing digital art as an outlet to unwind, learning new techniques and trying out new software along the way while shaping my skills.

The most decisive period was in 2020/2021, when the pandemic occurred. I spent most of my days indoors and decided to revive my passion for art & creating, and after hours of research I found the Ravencoin community and knew this is an ecosystem I want to build my project atop its fundamentals.

What inspires?

My wife & kids are the first source of my inspiration and motivation. Their love for life & kindness is simply uplifting.

Our community members, including our talented artists & developers are another source of inspiration as I witness their persistence and hard work daily, learn from them and admire their consistency and the shared goal of building a solid ground for projects to flourish on the Ravencoin blockchain.

As for who inspired my artistic journey, individuals like Jean-Michel Basquiat, Salvador Dalí, and Nikola Tesla had a great impact on me while growing up and still inspire me with their style & character to this day.

What or who influences your art?

That is a sophisticated question I must say! Both nature & science influence my artworks. I try my best to deliver a message with every new creation about my hopes & aspirations, and how I imagine the future of mankind.

What can you share about your process for art creation?

That is a topic I wanted to share with the community for awhile now, and I’m glad I’m able to shed some light on it today’s interview.

My process for art creation adapts to the nature & complexity of the artwork itself: For example, if I’m working on a 3D/AR project, I save the complex parts for early in the morning when I start my day at 5am and meditate, then work on the complex aspects of the artwork for up to 3 hours then begin my day and repeat the process the next following days until the there’s nothing left but those cosmetic touches that I enjoy doing in the evening with my kids around me so they can see the creation coming to life in the moment.

Overall, keeping my workstation tidy & neat, with medium lighting and calm music playing in the background, and of course a cup of coffee near me helps create the atmosphere I need and boosts my creativity.

Why do you use RVN?

As an artist, and despite being new in the NFT space, the Ravencoin ecosystem meets my needs. It is a code-fork of bitcoin with immutable ownership features, assets, censorship-proof, and a spectacular community to be part of. I don’t see myself building elsewhere other than Ravencoin.

What is your vision for the project you are working on?

The META-Z experience has been one of the greatest experiences thanks to our community! My vision for this project is to bring more utility to NFTs and gaming on the blockchain, and to be able to tell a story and help shape a better future where liberty, privacy, and financial freedom are not a privilege, but a fundamental right for all humanity.

How does the project connect to the NFT space?

NFTs are the backbone of the META-Z project, each one represents an essential segment of the storyline & the upcoming game and the open metaverse alike. With in-game property ownership, these NFTs are the immutable proof, secured via Ravencoin IPFS nodes insuring their existence.

What are some of your goals in this space?

My main goal is to build a shared collaborative space for our community on the Ravencoin blockchain. A place for artists, developers, and simply everyone to leave a lifetime legacy for the next generation to come.

What would you say to other artists that may be considering minting NFTs, but don’t know how to start?

To my fellow artists and everyone who wants to start but feels hesitant, or feels like this space is too big or too complicated, take that first step and you’ll not regret it. It only takes that very first step to embrace a whole new experience. Don’t be afraid to approach others, ask questions, and even make errors that you’ll learn from. We all started somewhere, and NOW is always the perfect moment.

Come join us and we’ll welcome you with open arms, guide you, and help you in every way we can.

Any last words?

I’d like to thank you for this opportunity to share my thoughts and goals. Being part of this community has taught me many lessons and helped me evolve as an artist, and as a person. Keep building, keep inspiring.

All my links for NFTs, social channels, and contact info can be found here: https://linktr.ee/jqn.io

Thank you Joaquin! I am eager to see what the future will bring for you in this incredible space.

To our readers, I hope you’ve enjoyed getting to know Artist Joaquin Chabers and learning about his exciting project Meta-Z. Please consider supporting him. For other related articles see:

Interview with NFT Artist Nifty Synth

Interview With Popular Pixel Artists Using Ravencoin

Pixel Art Is Cool, But 3D Pixel NFTs Are Awesome!

10 Great Reasons Why Real Estate Tokenization Is the Way of The Future

JC Keen
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0
10 Great Reasons Why Real Estate Tokenization Is the Way of The Future

Real estate tokenization is about to disrupt the way people invest. Real estate investing has some incredible advantages over other forms of investing. Unfortunately owning real estate can be difficult for the average person. That’s because in most cases an investor needs a large sum of money to use as down payment. Well, a down payment is no longer required when you buy tokenized real estate.

But that’s not all. Real estate tokenization has some other incredible advantages. Sure, it has some disadvantages, but overall this form of asset tokenization is sure to disrupt the real estate industry, for the better. Below we examine 10 great reasons why real estate tokenization is the way of the future.

What are the benefits of tokenizing real estate?

Lower Barrier to Entry

One of the biggest reasons to consider tokenizing real estate is because it lowers the barrier to entry for investors. That’s because in most cases tokenizing of an asset is done for the purpose of fractionalizing that asset. In other words, through tokenization, individuals are able to own a fraction of a real estate property.

This means that investors will no longer be required to have a large down payment to purchase real estate. Instead, investors are able to buy real estate with as little as $100, sometimes even less.

In short, investing in real estate is no longer just for the wealthy. This lower barrier to entry is at the core of what people in the tokenization space refer to as market democratization.

Instant Liquidity

Real estate is considered an illiquid asset. In most cases selling real estate takes several weeks and often months. Selling often requires advertising, showings, the process of offer and acceptance, inspections, etc.

Real estate tokenization changes all of this. Tokens representing ownership in real estate can be traded in Alternative Trading System marketplaces like tZero, as easily as buying and selling stock. By trading tokens investors can exit their investments whether they are selling $100 or $1,000,000 worth of real estate tokens.

Additionally, through Decentralized Finance (DeFi) it will be possible for investors to borrow against their real estate tokens rather than selling. This could be beneficial for tax purposes and may provide opportunities to leverage capital.

Access to Global Market Capital

Real estate is local, but real estate investors are all over the globe. Through real estate tokenization investors across the world can invest in whatever market they chose, provided regulatory compliance is in order.

This is good news not only for fractional ownership buyers, but also for owners, developers, funds, etc as this provides the opportunity to raise capital from investors all across the world.

Security and Transparency

Blockchain is a decentralized immutable ledger accessible to everyone. This goes to the heart of security and transparency. Security comes from the decentralized nature of the blockchain. The more decentralized the block chain the better. Transparency comes from the fact that every transaction is viewable in the blockchain itself.

This doesn’t mean that everyone can see your personal data in the blockchain, but it does mean that assets and transactions should be easily verifiable. See How To Verify Authenticity of Digital Assets

Lower Transaction Costs

Blockchain technology is incredibly efficient. This efficiency can be easily leveraged to multiple layers within a tokenization structure to the point that it can disrupt how traditional businesses operate. For example, in real estate transactions it is customary to utilize escrow services to hold earnest money on behalf of a purchaser during the process of completing a transaction. This silly step can be completely eliminated through the use tokens representing real estate.

Another example is the custom of using real estate brokers and title companies to buy and sell property. Broker and title fees can range from about 5% to 7% of the purchase price of the property. When trading tokens, users won’t have to pay for broker or title services at all!

Automation

Blockchain efficiencies have also led to automation of real estate tasks and investment management. For example, through tokenization, it is possible to automate cash distributions to token holders. The same concept can be used to automate payments to real estate management firms, lenders, etc.

Whenever investors sell real estate they are required to report and pay taxes. Imagine the difficulty of figuring out taxes if investors were buying and selling real estate hundreds of times per year. Well, this process can also be simplified and automated through real estate tokenization. After all, blockchain is simply a trusted decentralized ledger – an accountant’s dream.

Tokens can also be used to send messages to investors and for investors to vote.

Scalability

Once a tokenization process has been established it can be easily repeated. This is probably one of the biggest advantages of arriving early in this space. As adoption grows, early adopters will be in an excellent position to leverage their existing processes and grow their real estate portfolios, investor’s base, etc.

Improved Opportunity for Diversification

Most real estate investors remain niche specific. Single family residential real estate investing is by far the most common form of real estate investing. Few venture into other types of real estate investments such as multi-family, commercial, industrial, land, etc.

Given a lower barrier to entry and how easy it can be to buy real estate tokens, investors can now diversify their real estate investments. Think how cool it would be for an entity to to tokenize an RV park, and for you to own fractional ownership on that RV Park and later staying at it for to check on your investment while enjoying your vacation.

Let’s also consider geographical diversification. Real estate tokenization will make it possible for an investor to own real estate in multiple geographical areas, all over the world!

Growing Market

According to CoStar, the value of the world’s real estate assets is well past the $300 trillion mark. That’s a humongous market. However, tokenized real estate accounts for only $53.7M, according to a report by the Security Token Group. Although the tokenized real estate market is growing rapidly it is only a miniscule percentage of the total real estate market.

Adoption of blockchain technology is in its infancy. It is like the early days of the internet, when many people thought the internet was a solution looking for a problem. Disrupting the traditional real estate market won’t be easy, but it is inevitable.

It will take a few years for mass adoption to proliferate, but eventually buying real estate tokens will be as common as buying stocks using a smart phone.

As with the internet, those that recognize the potential of real estate tokenization are likely to benefit form what could be an explosive market growth.

Peer to Peer Transactions

One of the features of blockchain technology is its ability to permit peer to peer transactions. You and I can trade Bitcoin without the need for a third party. And in some decentralized applications you and I can already trade NFTs and other tokens, without the need for a third party.

Trading real estate tokens peer to peer will be a a little more difficult due to the need to meet regulatory compliance, but it is bound to happen.

Dissadvantages of Tokenizing Real Estate

There are certain disadvantages that come with tokenizing real estate.

Leverage

One of the reasons why investors love real estate investing is because you can leverage your money. This is thanks to the use of financing. You can buy real estate worth $100,000 with as little as $5,000 in down payment. When that investments grows at a rate of 2.5% in the first year, you grew your equity by 50% in a single year.

I suspect this will not always be the case in most tokenized real estate projects. That’s because most of those projects will seek to bypass bank financing. The most likely scenario is that when you buy a real estate token you won’t benefit in the same way from property appreciation and leveraging as in the traditional market.

New market

Real estate tokenization is in its infancy and will require significantly more adoption to truly take off. New markets open the doors for bad actors and gullible investors to be taken advantage of. And then there are the well meaning early adopters that fail to understand the risks that come along with new technologies. We’ve already seen too many examples of smart contracts being exploited by hackers. As I’ve mentioned before, smart contracts are the wrong tool for asset tokenization.

Lack of education – Public awareness

Most people don’t understand blockchain technology or its revolutionary nature. Imagine telling your father that you bought tokens representing fractional ownership on a real estate property in Australia using your smart phone. Chances are he won’t understand a thing. Indeed, we have a long road ahead to educate the public.

Cryptocurrency Volatility

The current bear market provided a reality check for many crypto investors. Many of these investors will be disillusioned for years to come. Cryptocurrencies will continue to be volatile. Many crypto projects are likely to fail and take many investors with them. All of this will translate into an adoption challenge for real estate tokenization.

Lack of Data (compared to stock)

When you buy a stock you can read quarterly and annual reports to help you make an informed decision. This type of information does not currently exist for real estate investments over the blockchain. If it exists, it does not fall under the same compliance scrutiny we are accustomed to see in the stock market.

Regulation Uncertainty

With emerging tech it is often the case that regulation can’t keep pace with new products and developments. This can lead to uncertainty, confusion, and often fines. Real estate tokenization is already taking place in many parts of the world, but each country will have different laws affecting regulation.

Conclusion Why Real Estate Tokenization Is the Way of The Future

I believe that the pros for real estate tokenization greatly outweigh the cons. Time will tell, but I am convinced that real estate tokenization is the way of the future. Buying, selling, and trading property tokens will be as common as it is to buy, sell, and trade stocks nowadays.

See also 13 Best Assets to Tokenize On the Blockchain

If you see things differently I’d love to hear from you. Please comment below.

How To Verify Authenticity of Digital Assets Like Art & Securities, Etc

JC Keen
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How To Verify Authenticity of Digital Assets Like Art & Securities, Etc

As cryptocurrency and blockchain adoption grows it will be essential for users to verify authenticity of digital assets.  This applies to anything that can be tokenized, including art, music, collectibles, and even securities.

Authenticity is of utmost importance to serious collectors.  Obviously, authentic art with verifiable history can command higher prices than otherwise. 

In the art world people use the word provenance to refer to the history of ownership of a painting or other work of art.  Provenance or authenticity can take various forms, including a certificate of authenticity, photographic evidence, auction sale records, etc.

In the crypto world, provenance has the same meaning.  Since a blockchain is a public ledger, it should follow that verifying authenticity and history of digital assets should be a straightforward process.  However, that is not the case when using smart contracts.    

The Case Against Smart Contracts

Unfortunately smart contracts are the wrong tool for tokenizing assets. These are unnecessarily complex, inefficient, and expensive, when all we are trying to do is creating and transferring digital assets.  This complexity introduces multiple vulnerabilities that can lead to errors and/or fraud.    

I won’t get into the precise details of what it takes to verify the authenticity of a digital asset within a smart contract, because frankly that is a futile exercise.  Let me just say that doing so is nearly impossible for the average person. This would involve finding the smart contract address, using Etherscan or a similar blockchain explorer, dissecting code and metadata, and then trusting that any externally stored information connected to the smart contract can’t be tampered with. 

Oh, and let’s hope that there isn’t a Decentralized Autonomous Organization (DAO) with rights to do whatever they please without your consent.

By the end of this extensive exercise hopefully you’d be able to somehow match numbers and letters to some online identity to satisfy yourself that the art was created by the rightful artist.

Then you’d want to engage in trying to understand which party owns what rights to the art. That is unless you are purchasing the art through some third party that may have some fine print addressing digital rights.

Source: RIMONLAW.COM

Before moving on, it is important to note that there are multiple ways in which bad actors can take advantage of loopholes in smart contracts. For an example on this I recommend reading What Is Sleepminting And Will It Ruin NFT Provenance?

The Case for an Asset Aware Layer 1 Protocol

A better solution for managing digital assets is to mimic Bitcoin’s Unspent Transaction Output (UTXO) model.  In other words, it would be ideal to manage digital assets as simply as it is to execute a bitcoin transaction. This brings me to Ravencoin (RVN), a fork of Bitcoin, designed specifically to handle assets utilizing the UTXO model.  RVN is an asset aware layer 1 protocol that does not need the complexity of smart contracts to handle digital assets. 

How To Verify Authenticity of Digital Assets When Using Ravencoin?

To verify the authenticity of a digital asset on the Ravencoin blockchain all you have to do is read the information directly from the blockchain using a blockchain explorer or viewer.  This is made easy by the fact that Ravencoin allows for the use of unique, human readable names, a folder like structure and Ravencoin’s ability to link any digital file using IPFS to a token.

Let’s look at an asset created by artis Kevin Lynch (@LynchStudios) as an example.

On the bottom right corner of this tweet you see the asset with the name KEVINLYNCH/LANDART#2. This is a human readable asset name that can be authenticated on the blockchain.

Kevin created the main asset KEVINLYNCH on Ravencoin. There is only one KEVINLYNCH asset name in the entire Ravencoin blochkain. Kevin owns that main asset and he is the only one that controls what can be created or minted under that asset.  This is possible because Kevin owns the private keys to this particular asset. 

He later created a sub-asset called LANDART. Think of sub-assets as sub-folders. If he desires he can create sub-assets for WATER_ART, MODERN_ART, PIXEL_ART, etc. Finally, he created a unique asset #2.

If a party wanted to sell art claiming it is art created by Kevin, all you would have to do to verify authenticity is to confirm that the main asset name is KEVINLYNCH. Then you would go to the Mango Farm viewer and type the chain address to see the art image directly linked to the blockchain.

In some cases, the asset has additional information such as the information shown on the right side of the image below. In this case the asset includes Kevin’s name, royalty requirements, a payment address for royalties, and his website.

How simple is that? When assets are created on Ravencoin, verifying authenticity is a breeze.

KEVINLYNCH/LANDART#2

Conclusion on Verifying Authenticity of Digital Assets

I expect that in the not too distant future it will be common to see peer to peer transactions of digital assets like tokenized securities. In other words, you and I would be able to trade tokens representing stocks, real estate, collectible items, etc.

As with art, it will be essential to authenticate these digital assets. Doing so is extremely difficult if the underlying asset is created using smart contracts. As shown above, verifying authenticity of digital assets is very easy when assets are created on the Ravencoin blockchain.

Udate

Shortly after writing this article I learned the featured art piece is now owned by BickBC Projects. See Brick’s gallery

13 Best Assets to Tokenize On the Blockchain

JC Keen
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13 Best Assets to Tokenize On the Blockchain

Few realize that almost everything of value will eventually be tokenized. That is because, thanks to blockchain technology, asset tokenization can be efficient, secure, it can provide for peer to peer transactions, fractional ownership, and it provides the tools to democratize all markets. This leads to the question of what sorts of assets should one tokenize on the blockchain?

Before we get into that, it is important to provide some context. Bitcoin has revolutionized how people view money and it has led to an entirely new market – cryptocurrencies. Despite this, I am convinced that the more revolutionary part about this invention is its underlying technology, that is blockchain technology.

A blockchain is a distributed ledger that is shared among computer networks for maintaining a secure and decentralized record of transactions. Blockchain technology provides for trust in the ledger without the need for third party.

Digital assets, such as contracts, images, music, etc can be added to a blockchain and can be transferred and/or traded similarly to how cryptocurrencies are transferred and traded. This opens up an entirely new universe for digital market for assets of all kinds, especially when you consider all sorts of securities can and eventually will trade on the blockchain.

The digital assets market will account for trillions, if not quadrillions, of dollars.

Unfortunately the Bitcoin blockchain wasn’t designed to handle assets, thus tokenizing assets on this blockchain comes with significant challenges. Similarly, Ethereum and other blockchains can be adapted to handling assets, but because these protocols weren’t designed for this purpose they can lead to significant inefficiencies, high costs, and security challenges.

A few blockchains have been designed with asset tokenization in mind. See Which Is the Best Tokenization Crypto?. Chief among them is Ravencoin, which is a fork of Bitcoin and was designed specifically for the purpose of asset tokenization, including the handling of digital securities (i.e. stocks). One key feature of Ravencoin is that it provides a solution to overcome the AML/KYC risks associated with securities and the issuance of STOs (Security Token Offerings).

What Are The Best Assets to Tokenize On the Blockchain?

Stocks

Eventually all stocks will trade on the blockchain. Earlier this year, Intercontinental Exchange Inc., NYSE’s parent, purchased a stake in tZero, a marketplace to trade private digital securities. tZero provides a trading system, which uses blockchain technology, where private and public entities can choose to list digital versions of their stocks. See NYSE Owner Gets on Board With Crypto-Powered Revamp of Trading.

Real Estate

Companies like RealT already provide investors with the opportunity to buy fractional, tokenized residential properties in the US. And companies like Market Space Capital is doing the same with multifamily developments. See interview with Sohail Hassan below.

In addition, smaller companies such as Hydra Chain Technologies and Dwell Homes Inc are jumping in this emerging market. Through their partnership with DigiShares, these two small companies are planning to tokenize single family residences in Wisconsin and Illinois, USA.

Real estate tokenization is expanding to all parts of the globe. Outside of the US, companies like BRIKbc Projects are tokenizing luxury residential real estate properties in Brisbane, Australia (home of 2032 Olympics City). Thus, providing access to real estate in hot markets for as little as one Property Token (under US$100).

Debt

In the simplest terms, blockchain technology can be used to tokenize debt to the point that traditional financing could become a thing of the past. Imagine raising funds for a business through peer to peer platforms and completely bypassing banks, while maintaining the right level of security and meeting all regulatory compliance.

Nevertheless, it is likely that the biggest users of debt tokenization will be the financial institutions. See J.P. Morgan’s Onyx Has Tokenized $300B of US T-Bonds So Far

NFTs

A few years ago, it was impossible to imagine that the Non-Fungible Token (NFT) market would grow as much and as fast as it has. According to Skyquest, the Global Non-Fungible Token (NFT) Market is expected to reach a value of USD 122.43 Billion by 2028.

Some argue that NFTs are a passing trend, but the reality is that NFTs can have real value and can combine with other forms of asset tokenization in multiple ways.

NFT Use Cases

  • Art
  • Music
  • Gaming
  • Fashion and wearables
  • Events and ticketing
  • Social media
  • Metaverse
  • Virtual land
  • Digital identity
  • Fantasy sports

Vehicle and Land Titles

There is no reason why vehicle titles, land titles, and any other titles or similar instruments can’t be tokenized. Titles stored on the blockchain make ownership transparent, secure, verifiable, and recognizable by local and global economies.

Medici Land Governance, an Overstock.com subsidiary has been using blockchain technology for a few years to support land governance, titling, and administration with a secure public record of land ownership.

Businesses and Business Entities

When it comes to tokenizing a business, this often means tokenizing the legal entity owning the business. If you want to tokenize a restaurant and the restaurant is owned under the entity Restaurant LLC, then most likely way do so is to tokenize the entity named Restaurant LLC itself.

The bottom line is you can tokenize any business!

Crypto Mining Farms and Mining Power

Cryptocurrency mining in large scale requires significant expenditures, especially when mining Bitcoin. Not surprisingly, companies like RenewaBlox, the worlds first exclusively renewable, immersion cooled, Bitcoin mining farm is planning to tokenize their business using the Ravencoin blockchain.

Tokenize Farms, Nature, Forests, Carbon Credits, Mines, etc

Farms of all types, anywhere in the globe can be tokenized. This could include livestock farms, fish farms, market gardens, orchards, vineyards, etc.

Additionally, forest of all types can also be tokenized. In fact, I’ve personally been exploring the idea of tokenizing timberland for the purpose of delaying clearcutting. This is an alternative form to selling carbon credits. It is easy to see how carbon credits will eventually be tokenized.

See Single.Earth Raises $7.9M Led by EQT Ventures to Tokenize Nature. According to their website, Single Earth is a platform that tokenizes nature for its ecological value – carbon sequestration, storage, and biodiversity.

Then there’s also Sustainable Impact Token (SIT), which utilizes algae biomass to generate tokenized carbon credits.

Sport Teams, Race Horses, Race Cars, etc

Companies like My Race Horse and The International Racehorse Owners Network (IRON) want to allow the general public to have fractional ownership in horse races. This can be new and exciting for race horse fans, but also can open new financing opportunities for horse owners, trainers, etc.

Books, Intellectual Property, Patents, etc

Late last year, True Return Systems LLC and Accu 2.0 LLC were seeking to auction US Patent No. 8,538,860, as an NFT, with a starting bid at around $7.5 million. This is believed to be the first patent auctioned as an NFT.

Car Rentals and Mobility Services

Asset tokenization has the potential to disrupt the car rental industry and mobility service providers like Uber and Lift.

In late 2020, Fetch.ai announced the launch of Mobility Framework. Fetch aims to provide decentralized mobility service solutions to local economies, delivering a hyper-local service through a common user-focused experience.

Luxury Goods Like Cars, Wine, Cigars, etc

The luxury good market is prime for asset tokenization. It is easy to imagine a world where luxury goods can be represented by a unique token that can also serve to trade (either whole or fractionalized), provide authentication, and even track the history of each unique item. Below are a few examples.

Late last year crypto startup CurioInvest began selling tokens for a limited-edition 2015 Ferrari F12 TDF. The car was originally valued at around with a $1.1 million. See When Ferrari? Tokenized Supercar Gives European Investors Exposure to Asset Class.

The tokenized Ferrari F12 TDF up for sale see CurioInvest

Vinsent, an Israel-based company combines blockchain technology with the concept of “wine futures.” Each wine bottle has its’ “token,” residing on the Ravencoin blockchain.

Conclusion on The Best Assets to Tokenize On the Blockchain

Above are just a few examples of the best assets to tokenize on the blockchain. The fact is that you can tokenize almost anything, including gold, gold bars, gold coins, silver, and other precious metals. You can tokenize collectible items, historical documents, important documents, etc. In fact, anything that benefits from a barcode could probably benefit in some way from tokenization.

Watch Out! Turmoil in the OpenSea NFT Marketplace

Guest
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Watch Out! Turmoil in the OpenSea NFT Marketplace

The Death of OpenSea

It was a Sunday morning, and I was in my garage working on my car, while listening to a Twitter Space call about the OpenSea NFT marketplace.  There was something different about this call.  The audience was huge, well over 2,000 people were participating in the call.  And there were a lot of Twitter users with those blue checkmarks. By the time I joined in, the call had already been going on for several hours.

The title of the Twitter Space call was “The Death of Opensea.”  What a great title!  That’s what drew me in.  As I listened, it became evident people were fed up with the persistent problems with the Opensea NFT marketplace. 

Hosts and listeners exchanged thoughts and ideas on how to make things better and how to replace Opensea with something else.  Much of the conversation revolved around the problem of having such a centralized NFT marketplace. 

After 30 minutes or so of listening I couldn’t hold back any longer.  I felt compelled to speak. People needed to know that there already is an answer to almost every problem being discussed on that call.  I had to share this answer with the 2,000 people or so listening. 

So, I pressed the button requesting to be allowed to speak.  And I waited, and waited, and waited.

The Opensea NFT Rapid Growth Created Huge Challenges

It isn’t difficult to understand why there’s so much turmoil in the Opensea NFT marketplace.  The reality is Opensea is a victim of its own success.  Opensea grew so fast that keeping up with growth alone was probably a monumental task. 

However, Opensea was perhaps destined to fail from the start for a different reason.  The host on that call could sense it, and many others on that call could sense it also.  But they couldn’t put their finger on the issue.

I don’t pretend to be an expert.  But, I have stumbled into some knowledge that opened my eyes to the problems with most NFTs and the problems with Opensea.  Better than just seeing the problem, what I actually stumbled into was the solution. This is what I wanted to share with those 2,000 listeners.  So, I kept waiting for my turn to speak. 

Numerous Problems with Opensea NFT Marketplace

When doing research for this article, I did online searches for problems with Opensea.  It takes but a few minutes to grasp how bad things are. 

There’ve been so many problems with OpenSea that a person could write an entire book on all the different issues. Again, some problems can be attributed to how fast OpenSea grew. However, other problems are fundamental.

The Problem People Don’t Want To Hear About

I had waited for over an hour and it was finally my turn to speak on the Twitter Space call.  Finally, this was my opportunity to let the audience know that the biggest problem with Opensea was its use of smart contracts.  I was also eager to let everyone know that I knew of a simple solution to this problem.  

Up to this point, speakers on this Twitter Space call had not been interrupted by other hosts or speakers.  But the moment I said that the problem with Opensea had to do with smart contracts, others were quick to interrupt.  I had to fend off several attempts to derail my exposition. 

Could people not see what was so obvious to me?  I did my best to present a cohesive argument, but I wasn’t allowed to engage in a real discussion.  The host and co-hosts moved on as fast as they could to the next person. Other speakers had been allowed 30 plus minutes to speak. I was given little time, despite presenting a very different perspective to the group. 

The call continued for what seemed to be over 12 hours long!  I had only listened for maybe 3 hours.  A few Twitter friends were listening when I spoke.  They agreed with me that for some reason the host and co-hosts didn’t want to hear my argument.  But why?

Well, it should have been obvious to me.  The influencers leading the call profit from the use of smart contracts.  They don’t want to hear me or anyone else speak of why smart contracts are the problem. They would love to have a decentralized alternative to Opensea, but it would need to be an alternative that doesn’t disrupt what they are doing.

The problem with Smart Contracts

Where do I begin? 

Smart contracts are too complex to be understood by the average NFT collector.  Smart contracts can be hacked, can have errors, require upkeeping, etc.  Most importantly, smart contracts don’t allow the NFT owner to have full control of their NFT.  The latter reason, in my opinion, is the biggest problem with smart contracts.  

Here’s the thing to remember: Smart contracts are the wrong tool for handling NFTs. 

I’ve written a couple of articles on some of the problems with smart contracts, which I am linking below, in case you want to learn more about this.

With all these problems, why DO we use smart contracts for something so simple as transferring digital images?  Answer: Because that’s what Ethereum did and that became the default answer.  And let’s not forget that thousands of people are earning millions of dollars in the NFT ecosystem involving Ethereum, smart contracts, NFTs, and marketplaces like Opensea.  Obviously, these savvy entrepreneurs have little incentive to truly solve the Opensea NFT marketplace problems.

The problem with Centralization

The other problem with the Opensea NFT marketplace is its centralized nature.  During that Twitter Space call numerous speakers made the case for decentralization.  Yes, a decentralized NFT marketplace sounds great!  But how do you create decentralization when dealing with smart contracts?  I argue that you can’t. The video below by an Ex-Google, Ex-FaceBook TechLead supports my point, at least in part.

The bottom line is that if you could create NFTs without having to rely on smart contracts, then decentralization of the NFT marketplace would have a chance.  I realize true and pure decentralization is probably unlikely, but I believe we can definitely get away from the extreme level of centralization occurring at Opensea today. 

Other NFT Marketplaces Dealing With Smart Contracts Will Experience Similar Challenges

Other NFT marketplaces such as Looks Rare, Rarible, etc will likely experience similar challenges to the challenges OpenSea is facing. Namely, these marketplaces are also dealing with smart contract based NFTs. And this alone forces these marketplaces to be more centralized than is desirable.

Also keep in mind that these marketplaces are trying to become an alternative to Opensea. To a large degree, they must be compatible with OpenSea. As a result, they have little incentive to be fundamentally different or to explore significantly different technologies.

An NFT Marketplace Void of Smart Contracts

Ultimately, the only real solution or alternative to OpenSea’s troubles is an NFT marketplace void of smart contracts. But is this even possible? YES!!!!

The answer lies within the Ravencoin (RVN) protocol.  Unfortunately, Opensea doesn’t want to hear this.  Why is that?  Well, it’s for the same reason the host and co-hosts of that call didn’t want me speaking.  They believe in the system that feeds them and they will die to protect it. 

As for me, I believe in the efficiency of the free market.  I believe a simple protocol, without smart contracts, is more efficient.  And I believe a higher level of decentralization is the best option. 

And it just so happens that that’s the ethos behind Ravencoin.  Ravencoin is a fork of Bitcoin and it is open source.  Ravencoin developers took the best crypto code and modified it exclusively for the purpose of creating assets and transferring assets.

The result is asset creation and transactions are handled at the base layer, without coding, without smart contracts. It is a simple and elegant solution.

With Ravencoin you can transfer an NFT as easily as you can transfer Bitcoin.  And when the NFT hits your wallet, all you have to do is to ensure you keep your keys.  If you have the keys to your wallet, then the crypto in the wallet and the NFTs in that wallet are yours. 

How Exactly Is Ravencoin the Solution to the Opensea Troubles?

First, when minting something on Ravencoin you can do it directly to the blockchain without having to deal with a third party.  You don’t need an NFT marketplace to do that for you. All you really need is the Ravencoin wallet with the minting feature.  I know of at least three wallets with these features, the Ravencoin Core wallet, the Mango Farm wallet, and the Stibits wallet. 

Second, once you mint something you can send it to anyone, directly.  All you do is transfer the asset, similar to how you would transfer Bitcoin. Below is a screenshot showing how easy it is to send an asset using the Mango Farm wallet.

But wait, where would that leave OpenSea?  You got it!  A Ravencoin NFT ecosystem could potentially be fully decentralized, therefore it could completely eliminate the need for OpenSea. But the reality is, users will still want an easy-to-use marketplace.  So I believe there will still be space for NFT marketplaces, but not fully centralized marketplaces like OpenSea. 

In fact, there’s one marketplace that is as decentralized as they come, Mellori.Market.  Think of Mellori as an NFT vending machine.  As a collector, you pick the NFT you like, you enter your receiving address and you send payment to the address provided.  At that point Mellori simultaneously sends you your NFT and sends the artist their payment for the NFT, minus Mellori’s fee. 

How cool is that?  No smart contracts, no code, no complex transactions.  This is extremely convenient and very decentralized. 

Below is a great video by my Twitter friend HypeManRVN showing you how easy it is to buy an NFT from Mellori.Market.

Conclusion

In conclusion, Opensea is in part a victim of its own success and in part a victim of smart contracts. Smart contracts are too complex and too vulnerable to hacks, attacks, etc. Ultimately, smart contracts make it very difficult for NFT marketplaces to be decentralized.

The real solution to Opensea’s troubles is for users to create NFTs without smart contracts. The only crypto protocol I know of that can do that is Ravencoin.

Unfortunately, Opensea NFT marketplace and other smart contract based NFT marketplaces don’t want to hear this. These marketplaces and the entrepreneurs becoming wealthy through the smart contract ecosystem aren’t incentivized to make significant changes.

In the end, I believe the efficiency of the free market will prevail and this will ultimately be the death of the Opensea NFT Marketplace.

Look! Not Your Keys, Not Your NFTs – Don’t Be Fooled!

JC Keen
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Look! Not Your Keys, Not Your NFTs – Don’t Be Fooled!

If you are into cryptocurrencies, then you’ve heard the saying “Not your keys, not your crypto,” or “Not your keys, not your coins.” Have you ever considered that the same principle should apply to NFTs? Yes, the saying “Not your keys, not your NFTs” should be an obvious principle. In fact, NFT marketplaces like Opensea could save a lot of trouble if they could just apply this very simple principle to NFTs.

What Does Not your Keys, Not Your Crypto Mean?

I am going to assume that if you are reading this article you already know the basics of what this means. In short, if you don’t have the private keys to your own crypto wallet, then most likely you are relying on someone else to keep custody of these keys. The most common situation is that you are relying on a third party (i.e. most cryptocurrency exchanges like Binance, Coinbase, Gemini, etc.) to handle the keys to your crypto.

The problem with this is, the said third party also has full custody of “your” crypto. Obviously, that party could take all of your assets, without your consent.

To learn more about what not your Keys, Not your Crypto means, watch the video below.

Crypto is Supposed to Remove Trust and Centralization

Satoshi Nakamoto said “I’ve been working on a new electronic cash system that’s fully peer-to-peer, with no trusted third party.”

Perhaps the two most important key elements of the Bitcoin experiment is that BTC aims to remove trust and centralization. Yes, Satoshi’s goal was to create a system where you and I could exchange crypto without having to trust in a third party.

So, why do millions and millions of users continue to trust in centralized third parties? I don’t claim to have the answer, but a few reasons come to mind:

  • Lack of education – Many users don’t understand the risk they are taking when they rely on custodial third parties.
  • Convenience – Many users understand the risk, yet they don’t want to be bothered with the hassle of keeping track of their keys.
  • Crypto is too complex – It may be that managing crypto is still too complex for the average user.

Regardless of the reason, the fact is too many people let others handle custody of their keys.

Not Your Keys, Not Your NFTs

When it comes to NFTs, the problem is much larger and complicated for two main reasons. Firstly, most NFTs are unnecessarily more complex than crypto. As such, users have a higher difficulty recognizing the risk of not owning their keys. In fact, most NFT users don’t even think about keys. Secondly, most NFTs are created using smart contracts and in said cases the party controlling the smart contract has full control of the NFT.

Collectors buying an NFT on Opensea don’t hold the keys to anything. Rather, they rely on a smart contract that tracks ownership of the NFT. Ultimately someone else has control of the NFT.

The Solana Banana Fiasco

Allow me to illustrate this problem with a real life example. Recently, a Twitter user reported a situation where collectors bought HotSpringMonkey NFTs and woke up one day to find out that their NFTs had been converted into images of bananas.

How could this happen? Fairly easily actually, if someone else controls the contract for those NFTs. My understanding of the situation is that HotSpringMonkey had a DAO (Decentralized Autonomous Organizaion) managing the contract. And the DAO voted to convert any HotSpringMonkey NFT that was listed for sale for less than 1 Sol to a banana.

The idea was to force the market to raise the floor price of these NFTs. But that’s beside the point. The point here is that someone else had full control of the NFT. And this was possible because the smart contract permitted all of this.

Smart Contracts Are The Wrong Tool for Handling NFTs

The biggest problem with trying to apply the Not Your Keys principle to the NFT market is that most NFTs are created using smart contracts. And as we’ll discuss below, smart contracts are the wrong tool for handling NFTs.

Think of how simple a bitcoin transaction is. You give me your receiving address, I enter it in the sending section of my wallet, I enter the amount, and then click send. And that’s all. Within minutes, the transaction is completed and recorded on the blockchain, without the need of a smart contract.

Sending a digital image shouldn’t be more complicated than that and it shouldn’t require smart contracts. Smart contracts may be a good solution for other problems, like decentralized finance (DeFi), but not for NFT sales. The fact is smart contracts are just too complex to be used for simple transactions. These complexities introduce unnecessary risks into the NFT space.

See article best crypto for asset tokenization – 9 Most Common Smart Contract Vulnerabilities, which include:

  1. Indirect execution of unknown code
  2. Reentrancy
  3. Incorrect calculation of the output token amount
  4. Interface / naming issues
  5. Dependency on the order of execution
  6. Time component
  7. Using the blockhash function
  8. Incorrectly handled exceptions
  9. Incorrect work with ERC20 token

Most people use smart contracts to mint NFTs, because that’s what Ethereum did and Ethereum led the way. But this precedence doesn’t mean that smart contracts and NFTs are the best fit for each other. The bottom line is smart contracts are the wrong tool for handling NFTs.

What If You Could Mint and Trade NFTs Using Bitcoin, Without Using Smart Contracts?

You can! Please allow me to elaborate. Bitcoin has been forked to create multiple other currencies. For the most part, these cryptocurrencies utilize major portions of the Bitcoin code, and modify other parts of it. In doing so, developers can create cryptocurrencies aimed at more efficiently solving specific problems. These cryptos could be faster, have bigger blocks, higher supply, etc. One such example of said cryptos is Ravencoin (RVN).

Ravencoin was forked from Bitcoin and modified specifically for the purpose of minting and transferring assets. Ravencoin’s developers modified Bitcoin’s code in order to handle asset creation and transfers at the base layer. RVN doesn’t rely on smart contracts. However, it can be integrated with smart contracts, but that’s not necessary, especially when dealing with simple things like NFTs. The bottom line is that transferring Ravencoin NFTs is as easy as transferring Bitcoin. All you really need is an asset aware wallet.

When you buy an NFT minted on Ravencoin the NFT can be sent to your wallet, just like Bitcoin can be sent to your wallet. The important part is that once the NFT is in your wallet and you have the keys to your wallet, then no one can touch your NFT.

The solution to the Not Your Keys, Not Your NFTs challenge is simple. When you wrap your brain around it you’ll wonder what in the world we were thinking using smart contracts for minting NFTs.

If you are interested in learning how to mint Ravencoin NFTs, this video shows you how using the Mango Farm Wallet.

If you are interested in creating a generative NFT collection, then this video showing a website called Ravenmint is a good place to start.

NFT Proof of Ownership And Proof of Authorship

Having said that, the NFT marketplace struggles with two other related challenges, proof of ownership and proof of authorship. When you buy an NFT, how do you know that what you are buying is the original NFT and not some copycat NFT? Or how do you know that the NFT you are buying was created by the artist you believe created it?

If the NFT you are buying was minted using smart contracts, then you won’t be certain of anything unless you can read code and understand what the smart contract says.

However if you are buying an NFT minted using Ravencoin, you can easily confirm the NFT you are buying is an original NFT from the artist you intended to purchase from. This is because when an NFT is minted on Ravencoin, the creator utilizes unique human readable asset names to create collections and NFTs.

For example, I created a collection called CryptoMona. This is an NFT collection based on Davinci’s Mona Lisa. You can go to Ravencoin Asset Explorer and see the name of the NFT, the name of the collection, and the image associated with that asset. And remember, there can only be one CryptoMona collection on the Ravencoin blockchain. And I am the only person that owns the CryptoMona name on the Ravencoin blockchain.

CryptoMona 97

Can you see how Ravencoin solves the proof of ownership and proof of authorship problem?

Don’t Be Fooled! Not Your Keys, Not Your NFTs

In conclusion, if you are buying NFTs from marketplaces like Opensea, Looks Rare, Rarible, etc then you are buying NFTs minted using smart contracts. If you are buying NFTs using smart contracts, then you don’t really own the keys to your NFT. And as I showed you above, Not Your Keys, Not Your NFTs. The Solana Banana example mentioned above tells the story.

The answer to the Not Your Keys, Not Your NFT challenge is to continue to educate people about the inherent risk of not owning the keys. But most importantly, this challenge would be so much easier to overcome if people stopped using smart contracts to handle simple things like NFTs. There are better protocols out there, like Ravencoin, for simple things like minting and transferring assets.

10 Great Reasons to Buy Ravencoin | Investing, Best investments, Cryptocurrency
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