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Blockchain & Web3 Weekly Bytes Edition #15
Exploring Blockchain Types, MicroStrategy Innovates & ICP's Bold Internet Vision
May 4, 2024
Hello Fellow Enthusiast,
This week, I've gathered a wealth of exciting updates across the blockchain and Web3 sectors, highlighting their swift technological advancements. Each piece is designed to provide you with the latest insights and significant developments impacting our digital future.
In our Tech Spotlight, I explore the different types of blockchains—public, private, and consortium—and their specific impacts on the tech landscape, from enhancing security protocols to facilitating new partnerships.
This week's top news features MicroStrategy's innovative approach to decentralized identities via Bitcoin, alongside Australia's significant moves towards launching Bitcoin ETFs—a step that could greatly enhance cryptocurrency accessibility.
Our Digital Asset Spotlight shines on Internet Computer (ICP), discussing its ambitious plan to expand internet functionality. Meanwhile, our Chart of the Week forecasts an exciting milestone: Bitcoin is on track to reach half a billion global users by October, highlighting a major adoption wave.
Lastly, our Video Spotlight offers an informative comparison between Web2 and Web3, outlining the practical differences and impacts these technologies have on our online experiences.
Weekly Trivia
Which blockchain technology was the first to implement a proof-of-stake consensus mechanism, challenging the traditional proof-of-work model?
A) Peercoin
B) Cardano
C) Tezos
D) Ethereum
*Find the answer at the bottom of this newsletter.
Tech Spotlight – Types of Blockchain
Blockchain technology comes in various forms, each designed to suit specific needs and scenarios. Here's a straightforward look at the three primary types of blockchain:
1. Public Blockchains
Public blockchains are completely open, allowing anyone to join and participate without needing permission. This type is widely used for cryptocurrencies like Bitcoin and Ethereum, where transparency and security are maintained by allowing any user to contribute to network operations, typically through activities like mining or staking.
2. Private Blockchains
Private blockchains restrict access and are typically managed by single organizations. A notable example is Hyperledger Fabric, used by businesses requiring confidentiality and more controlled access. It's ideal for applications that demand privacy and fast transaction processing, such as supply chain management or enterprise resource planning.
3. Consortium Blockchains
Consortium blockchains are managed by a group of organizations rather than a single entity. An example is R3’s Corda, used primarily in the financial sector. This type balances transparency with control, providing the necessary privacy for transactions between trusted entities while maintaining some decentralization.
Real-World Example
Consider public blockchains like a large open park where anyone can join in activities. In contrast, a private blockchain is like a private club with restricted access, ensuring privacy and exclusivity for its members. Consortium blockchains can be likened to a business park where several companies share access but maintain their own private spaces within.
Practical Implications
Choosing the right type of blockchain depends on the project or business's needs. Public blockchains offer robust security and transparency, private blockchains prioritize privacy and efficiency, and consortium blockchains provide a balance, making them suitable for collaborations among multiple organizations.
This Week’s Blockchain and Web3 Highlights
MicroStrategy's Innovative Digital ID Initiative: MicroStrategy is advancing the use of Bitcoin's blockchain for decentralized identities with the launch of the Orange protocol. This new platform aims to anchor digital IDs on the blockchain, enhancing security and transparency.
Australia Poised for Bitcoin ETFs: Australia's ASX stock exchange is set to welcome its first approved batch of spot Bitcoin ETFs by the end of 2024. This move will broaden the range of investment options available to Australian investors, who have had access to spot bitcoin ETFs on the CBOE Australia since 2022.
Coinbase Integrates Lightning Network: Coinbase has introduced support for the Lightning Network, enhancing transaction efficiency and cost-effectiveness. This integration reflects a significant step forward in improving the user experience for sending, receiving, and paying with bitcoin.
MoonPay and PayPal Collaboration: MoonPay now allows users in the U.S. to buy cryptocurrencies using PayPal. This partnership streamlines the process, making it easier for users to purchase crypto via wallet transfers, bank transfers, and debit card transactions.
VanEck Reports Significant Bitcoin Holdings: Investment firm VanEck has noted that approximately $175 billion worth of bitcoin is currently held by ETFs, nations, and companies, highlighting the widespread institutional and governmental adoption of Bitcoin.
BlackRock's Digital Fund Grows: BlackRock's USD Institutional Digital Liquidity (BUIDL) Fund has reached $375 million in assets under management, demonstrating significant interest and investment in digital asset solutions.
Jack Dorsey's Block to Invest in Bitcoin: Block, formerly known as Square and led by Jack Dorsey, announced that it would invest 10% of its gross profit from bitcoin-related products into bitcoin each month, indicating strong belief in the long-term value of bitcoin.
Binance Ex-CEO Sentenced: Changpeng Zhao, the founder of Binance, has been sentenced to four months in prison, showcasing ongoing legal challenges within the cryptocurrency industry.
Affiliate Spotlight: Ledger Nano X
For those looking to enhance the security of their digital assets, the Ledger Nano X provides a reliable solution. This hardware wallet is designed to keep your cryptocurrency safe and accessible, no matter where you are.
Features of the Ledger Nano X
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Bluetooth Connectivity: Manage your assets on the go, connecting safely to your smartphone.
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Extensive Capacity: Store up to 100 different cryptocurrency assets simultaneously, making it ideal for diverse portfolios.
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Enhanced Security: With state-of-the-art security protocols, your private keys never leave the device, and your assets are protected against physical and digital threats.
Why Choose Ledger Nano X?
Choosing the Ledger Nano X means opting for peace of mind. Its robust security features and ease of use make it a top choice for beginners and experienced users looking to secure their cryptocurrencies effectively.
Get Your Ledger Nano X Here
For enhanced security of your digital currencies, consider the Ledger Nano X. Secure your piece of mind by purchasing through this affiliate link. Remember, not your keys, not your coins—take control of your crypto by keeping your private keys in your hands.
A Little Blockchain Humor Break
Blockchain noobs when they first hear about how transactions can't be altered.
Source: CoinMarketCap
Chart of the Week: Bitcoin's User Growth Trajectory
This week's chart provides a comprehensive look at the growth of Bitcoin users over time, projecting an impressive milestone of 500 million global users by October 2024. The chart combines data from various sources, including on-chain analytics from Glassnode, user data from exchanges through studies by Cambridge and Crypto.com, and adjusted projections based on Bitcoin-only users.
Key Observations
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Steady Increase: The adoption curve shows a consistent increase in the number of Bitcoin users, closely correlating with periods of heightened price activity.
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Integration of Data Sources: By incorporating both on-chain data and KYC'd exchange user data, we get a fuller picture of the Bitcoin ecosystem’s expansion.
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Future Projections: The forward projection indicates a continuing growth trend, with potential implications for market dynamics and cryptocurrency adoption globally.
Implications
This trend suggests a growing acceptance of Bitcoin as a mainstream financial asset and could herald broader adoption of cryptocurrencies. It also underscores the importance of infrastructure and regulatory frameworks that can accommodate an increasing number of users.
Source: Willy Woo
Weekly Video Spotlight: Web2 vs. Web3 — A Detailed Comparison
This week's video spotlight clearly compares Web2 and Web3 technologies. It outlines the shift from centralized platforms to decentralized networks that characterize the new internet generation.
Why Watch This Video?
This video is essential for anyone looking to grasp the significant differences between Web2 and Web3. It's particularly useful for developers, investors, and tech enthusiasts keen on understanding the implications of decentralized technologies.
Enhance your understanding of the internet's evolution by watching the video here. It's an excellent resource for anyone interested in the impact and potential of Web3.
Thank you for joining me in this week's exploration of pivotal blockchain developments. We've covered substantial ground, from dissecting various blockchain architectures to spotlighting MicroStrategy's decentralized ID innovations and Internet Computer's vision for a more capable internet.
Trivia Answer: A) Peercoin. Peercoin pioneered the use of the proof-of-stake consensus mechanism as early as 2012, becoming the first blockchain project to offer a fully operational alternative to the proof-of-work model.
Stay tuned for next week's edition, where I'll continue to bring you the latest and most significant updates from the blockchain and Web3 worlds.
Best Regards,
Ajay Tomar
Disclaimer:
Content in this newsletter is for educational and informational purposes only and is not intended as financial, tax, or legal advice. Always do your research and consult with a professional before making financial decisions. As a solopreneur, I may earn commissions from affiliate links in this newsletter at no extra cost to you. This support helps me bring you valuable content. I only endorse products I trust and believe could benefit you.
Weekly Digital Assets Spotlight
Spotlight on Internet Computer (ICP)
I'm highlighting the Internet Computer (ICP) in this issue, a groundbreaking digital asset and technology designed by the DFINITY Foundation. ICP aims to transform the internet into a robust computing platform capable of running smart contracts at web speed.
What is Internet Computer?
Internet Computer is a blockchain initiative that extends the internet's functionality to include computation beyond simple data sharing. It supports a network of independent data centers, creating an innovative infrastructure that aims to reshape traditional cloud services.
Features of Internet Computer
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Speed and Scalability: ICP operates with the efficiency and speed required for commercial and personal use, scaling dynamically to meet demand.
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Cost Efficiency: By decentralizing the functions typically reserved for cloud services, Internet Computer reduces costs linked to data storage and processing, offering an economical alternative for developers and businesses.
Why This Matters to Us
ICP represents a significant step in blockchain technology, merging with traditional internet capabilities to enhance digital interactions and services. It's not merely a blockchain project; it's an upgrade to how we interact with and utilize the internet.
For Our Developer Community
If you are a developer or a tech enthusiast, Internet Computer provides a fertile ground for creating decentralized applications that can perform on par with conventional web apps. It offers the scalability and efficiency necessary to make a real-world impact.