OVERVIEW

Ten Crazy Crypto Facts You Didn’t Know 💯 

Welcome to day three of our week in DeFi.

We’ve tackled liquidity pools and automated market makers so far, now we’re on to decentralized exchanges (DEXs, what they’re used for, and what they do.

Also in today’s Litepaper: some very crazy facts about crypto you might not have heard of. 👂️ 

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Five Crazy Crypto Facts You Might Not Know 😲

Ok, some of these you might know – but not everyone has been in crypto for 10+ years. But there are definitely some you don’t know. 🧠 

It’s Gone Forever

Fact: An estimated 20% of all BTC is lost forever. People have lost private keys, passed away without sharing access, or thrown away hard drives with fortunes on them. That’s about 3.7 million BTC, or hundreds of billions of dollars, lost in the digital abyss. 💸

We Still Don’t Know Who He Is

Fact: Satoshi Nakamoto, the creator of Bitcoin, is still unknown. I mean, we do know it’s not Craig Effing Wright. Despite numerous theories and investigations, Satoshi’s identity (or identities) remains one of the biggest mysteries in tech history – hell, might be one of the biggest mysteries in all of history. His wallet holds about 1 million BTC, untouched. 🕵️‍♂️

Ethereum Is Not The Original Ethereum

Fact: Ethereum Classic is the original Ethereum blockchain.

In 2016, a major hack exploited a vulnerability in the DAO, a decentralized autonomous organization, resulting in the theft of $50 million worth of Ethereum.

Vitalik Buterin and much of the community proposed a hard fork to recover the stolen funds and restore the network’s integrity. However, blockchain purists like Charles Hoskinson believed that the blockchain’s immutability was paramount and opposed the fork.

The resulting split created two separate blockchains: Ethereum, which reversed the hack, and Ethereum Classic, which maintained the original transaction history. 🤯 

It Takes A Lot Of Power To Mine Bitcoin

Fact: You may have already heard that the energy needed to mine Bitcoin is on par with or greater than the same amount to power some countries, like Argentina, Norway, New Zealand, or The Netherlands.

What you might not know is that Bitcoin’s energy usage is greater than that of the entire airline industry and Google’s global operations. ⚡️ 

Dogecoin And Litecoin Are Mined Together

Fact: Bet you didn’t know this one -Dogecoin and Litecoin are both ‘merge-mined’. In fancy schmancy speak, the official name is Auxilliary Proof of Work (AuxPoW). AuxPoW allows miners to mine both Dogecoin and Litecoin simultaneously using the same computational power. And, get this, this has been the case since 2014. 👩‍❤️‍💋‍👨 

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DEFI
Decentralized Exchanges (DEXs) 🕹️ 

A crucial part DeFi is decentralized exchanges, or DEXs. DEXs are where liquidity pools and AMMs reside. DEXs enable traders to transact directly with each other without the need for intermediaries like banks or traditional exchanges. 🖥️ 

Instead of relying on a central authority to oversee and authorize transactions, DEXs utilize blockchain technology to facilitate and validate peer-to-peer trades.

Key characteristics of DEXs:

• Peer-to-peer trading 🤝: In a DEX, the trading process involves a direct exchange between two parties.

• Non-custodial 💼: DEXs do not hold your funds. Instead, you retain complete control of your assets.

• Operates using smart contracts 🤖: Trades are executed and facilitated through smart contracts, self-executing contracts with the terms of the agreement directly written into the code.

The Inner Workings of DEXs

DEXs operate on blockchain networks that support smart contracts, such as Ethereum and Cardano.

When a trade is initiated on a DEX, the platform’s smart contract kicks into gear, automatically executing the transaction following its predetermined set of rules.

This ensures that the terms agreed upon by both parties are adhered to without the need for trust or the oversight of a third party. 🥉 

💡Remember: In a DEX, the platform itself never comes into contact with your funds. Everything is managed within the blockchain through the smart contract!

Advantages of DEXs: Trading with Freedom and Privacy

Decentralized exchanges bring a host of unique advantages to the table:

• Censorship resistance: As DEXs are decentralized, it is challenging for governments and other institutions to shut them down or censor transactions.

• Privacy: Unlike centralized exchanges, DEXs require minimal personal information, enabling you to keep your personal details private while you trade.

• Control over funds: Since DEXs are non-custodial, you have complete control over your assets at all times – but that doesn’t mean you’re not at risk. Crypto’s history tells us that, and reminds us of it with a stupidly high frequency, too. 💢 

Disadvantages of DEXs: Challenges on the Road to Decentralization

While they have significant advantages, DEXs also have their challenges:

• Usability: For newcomers DEXs can be daunting – or just straight up confusing as hell. They generally require a higher level of technical knowledge compared to traditional exchanges, and the process of setting up wallets and managing keys can be complex.

• Speed and cost: Depending on the blockchain network they operate on, transactions on DEXs can be slower and more costly than on centralized exchanges due to network congestion and high gas fees.

• Smart contract risk: While smart contracts enable trustless transactions, they’re not immune to bugs. If a smart contract has a vulnerability, it could be exploited, leading to user losses. 😠 

Popular DEXs

The crypto landscape is awash with numerous DEXs, each with its own unique features and advantages:

1. Uniswap: As the largest DEX on the network, Uniswap has become synonymous with decentralized trading. It offers a simple interface and a hugenormous selection of Ethereum-based tokens for trading.

2. SushiSwap: A community-driven DEX, SushiSwap offers a range of additional features, including yield farming and staking. It’s known for its active community and innovative approach to decentralized finance (DeFi).

3. PancakeSwap: PancakeSwap has become more and more popular due to its lower transaction fees and unique features like lotteries and NFT trading. And like we pointed out earlier this week, CAKE’s May volume topped UNI’s. 🥞 

4. Balancer: A flexible DEX that allows customizable liquidity pools with multiple tokens and adjustable weights, unlike the standard 50/50 pools. It’s ideal for advanced users seeking tailored portfolio management and yield opportunities.

5. 1inch: An aggregator that sources liquidity from multiple DEXs to find the best trade prices. It’s user-friendly, supports cross-chain swaps, and optimizes gas fees, making it a favorite for cost-conscious traders. They also have a very, very active blog that keeps people informed about the DeFi and DEX environments – A+ on the education side of things from them. 👍️ 

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Five More Even Crazier Crypto Facts You Probably Didn’t Know 🤯 

A Cryptocurrency Was Created to Fund a Time Machine 

Fact: In 2017, a project called ChronoBank launched a token called TIME to fund research into time travel. The idea was to create a decentralized platform for time-based labor markets, but its whitepaper hinted at loftier goals, like exploring temporal physics. Spoiler: It’s not around anymore. At least not in this version of time. ⏲️ 

Bitcoin’s Smallest Unit Is Named After a Forum User

Fact: The smallest unit of Bitcoin, a satoshi (0.00000001 BTC), is well-known, but few know it was named after a pseudonymous user, “satoshi,” on the BitcoinTalk forum. This user, presumed to be Satoshi Nakamoto, proposed the term in 2010 during a discussion about Bitcoin’s divisibility. 🦜 

A Crypto Token Was Launched for a Fictional Country

Fact: In 2018, the Liberland Merit (LLM) token was created for Liberland, a micronation claiming a 7-square-kilometer patch of disputed land between Croatia and Serbia. It’s still there. 🌍️ 

A Blockchain Stores a Secret Message in Its Genesis Block

Fact: The Zcash (ZEC) privacy coin, launched in 2016, hid an Easter egg in its genesis block: a reference to the Bitcoin genesis block’s famous headline (“The Times 03/Jan/2009 Chancellor on brink of second bailout for banks”). Zcash’s developers embedded a cryptographic puzzle, solvable only with the private keys used to create the coin’s initial setup. 🤫 

A Crypto Project Tried to Tokenize a Mouse’s DNA

Fact: In 2023, BitMouseDAO, a bizarre experiment, attempted to encode a cryptocurrency wallet’s private key into the DNA of a white-footed deer mouse using a genetically engineered virus. The project wanted to create a “living wallet” where the mouse’s DNA would secure funds. Shocker: ethical concerns and technical failures halted it. 🐭 

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