Tag: blockchains

AI Cryptocurrencies: All You Need to Know About This Emerging Crypto Category

The intricate world of cryptocurrencies, much like the real-world order, classifies its offerings under distinctive categories like utility coins, payment coins, and stablecoins to keep things simple for the investors. In recent times however, a new class of cryptocurrencies, called AI crypto coins, has triggered quite the intrigue on social media. Powered by Artificial Intelligence (AI), these AI crypto coins are usually related to projects that aim to bring AI and blockchain together, along with elements of Machine Learning (ML).

Like all usual cryptocurrencies, AI crypto tokens are also built on blockchain networks. Unlike other cryptocurrencies, however, these tokens are loaded with AI capabilities that promise better security, functionality, as well as the general performance.

AI crypto coins are capable of recording and maintaining market trends, in addition to predicting the upcoming fluctuations in prices.

Using the natural language processing (NLP) technology, AI cryptocurrencies could also comb social networking platforms to scan for crypto-related keywords and help investors make informed decisions.

As per a recent report by Go Banking Rates, there are currently a big bunch of existing AI coins, with an estimated collective valuation of $3.2 billion (roughly Rs. 26,436 crore).

The Graph (GRT), Render Token (RNDR), Injective (INJ), SingularityNET (AGIX), and Oasis Network (ROSE) are named as the top five AI cryptocurrencies on CoinMarketCap, with valuations ranging between 301.73 million (roughly Rs. 2,492 crore) to $1 billion (roughly Rs. 8,260 crore).

Like usual cryptocurrencies, investors can use traditional exchanges like Crypto.com or Coinbase to purchase these AI tokens.

Why do investors choose AI coins

Traditional cryptocurrencies like Bitcoin and Ether are subject to market volatility and could, hence, be perceived as financial risks. In order to stay ahead of the curve, AI crypto coins attract investors who prefer taking an algorithmically calculated approach in terms of suggesting investments.

As per LCX, the Liechtenstein-based crypto exchange, AI cryptocurrencies also offer better security measures like, facial recognition technology, deployed to prevent fraud.

These are among top reasons why experimental investors give AI-backed cryptocurrencies a shot.

Drawbacks and opinions

Despite the otherwise glowing growth trajectory of AI coins, some from the industry are not fully convinced that these cryptocurrencies are any better than the other classes of these digital assets.

Speaking to Gadgets 360, Indian blockchain architect and Web3 author Rohas Nagpal said investors must do their due diligence before investing funds into “all hype” altcoins.

“AI is a great disruptive force that will change a lot of things. But the so-called AI cryptocurrencies are all hype, no substance,” Nagpal said.

In addition, there is the glaring issue of data collection. Since AI tokens need to access holders’ market habits to suggest investment advice, it would collect the data around the investors’ investment patterns.

Samsung Galaxy A34 5G was recently launched by the company in India alongside the more expensive Galaxy A54 5G smartphone. How does this phone fare against the Nothing Phone 1 and the iQoo Neo 7? We discuss this and more on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.
Affiliate links may be automatically generated – see our ethics statement for details.

Check out our Latest News and Follow us at Facebook

Original Source

Cross-Chain Bridges: What Are These and How Do They Work?

The existence of cryptocurrencies relies completely on blockchain technology. Between Bitcoin’s inception in 2009 and present day, more than 1,500 cryptocurrencies are thriving in the ecosystem. While the idea of blockchain is a singular data transfer type, research firm Alchemy claims that there are over 125 Layer 1 and Layer 2 blockchains. Cross-chain bridges were introduced to bridge the gap between these different blockchains and the wide array of cryptocurrencies that are used for facilitating unique trade-offs, security gurantees, and scalability. Essentially, cross-chain bridges raise the interoperability quotient in the crypto sector and allow users to send cryptocurrency from one chain to another.

Before cross-chain bridges came into being, people were unable to use Bitcoin on the Ethereum blockchain or vice versa. This restricted cryptocurrency users from working on different blockchains like how credit cards work for various providers.

A cross-chain bridge reportedly connects independent blockchains and enables the transfer of assets and information between them. This, in turn, allows users to access other protocols easily.

Previously, if an ETH holder wanted to convert these assets into Polygon, the person would have had to use a centralised exchange like Coinbase or Binance to do so.

Cross-chain bridges, on the other hand, work by “wrapping” tokens in a smart contract and issuing native assets that can be used on another blockchain.

“For instance, wrapped BTC (wBTC) is an ERC-20 token that uses BTC as collateral. Users must deposit BTC on the Bitcoin blockchain before receiving wBTC tokens on the Ethereum network,” the Alchemy study explained.

Binance Bridge, Celer cBridge, Multichain, and Wormhole are among popular cross-chain bridges.

In recent times, however, these cross-chain bridges have caught the attention of hackers and money launders swarming towards the crypto sector.

In the last two years, over $540 million (roughly Rs. 4,290 crore) have reportedly been laundered by RenBridge. The platform is a decentralised application (dApp) that allows the minting of real BTC, ZEC, and BCH on Ethereum as an ERC20 token (renBTC, renZEC, renBCH), a report by Elliptic stated in a recent study.

Back in June, Layer-1 blockchain Harmony’s Horizon Bridge was hacked for the sum of roughly $100 million (roughly Rs. 780 crore). Harmony’s blockchain bridge enables users to transfer digital assets between different blockchains, the most notable of which are the Binance Smart Chain, Ethereum, Bitcoin, and Harmony networks.

Qubit Finance’s bridge was hacked for $80 million (roughly Rs. 630 crore) back in January, thieves stole $320 million (roughly Rs. 2,510 crore) from the Wormhole bridge a month later, and hackers drained $625 million (roughly Rs. 4,730 crore) in Ether and USDC from Axie Infinity’s Ronin bridge in March.

As per the Elliptic report, decentralised cross-chain bridges such as RenBridge provide an unregulated alternative to exchanges for transferring value between blockchains and hence pose a challenge. Transactions on these cross-chain bridges are processed by a network of thousands of pseudonymous validators known as “Darknodes”.

Malicious actors exploit these bridges by depositing their tokens from one chain to the bridge and then receiving the equivalent of a parallel token in another chain.

Earlier in July, the Financial Action Task Force (FATF) had published a special report saying that illicit activities involving cross-chain bridges will become an area of increasing regulatory focus as 2022 steps into its second-half.

The FATF is the global standard setter for anti-money laundering and countering the financing of terrorism (AML/CFT) measures.

Check out our Latest News and Follow us at Facebook

Original Source

Exit mobile version