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Why 90% of Crypto Traders Lose Money and Only Two Types of People Survive
Most crypto traders fail not because they miss big opportunities, but because they prioritize fast profits over capital preservation and exit the market before the next real cycle begins.
The only people who consistently survive are long term veterans who learn from repeated cycles, and highly resilient risk takers who survive multiple failures and eventually adopt discipline.
Sustainable success in crypto comes from risk management, patience, and steady compounding, not from chasing leverage, hype, or one time outsized wins.
INTRODUCTION
In the crypto world, there have been too many stories about one hundred times gains. Because of this, most people enter the market with only one goal. They want to make fast money.
But almost all data points to the same outcome. Most people eventually leave the market with losses.
This article will not teach you how to find the next big winner. Instead, it focuses on something more important. How to survive in a brutal market.
SURVIVAL COMES FIRST PROFITS COME SECOND
Only by protecting your capital can you stay in the game.
Most people enter crypto believing it is a shortcut to wealth. They want to earn a large amount of money in the shortest time possible. This misunderstanding is the main reason why so many people fail.
There is a common myth in crypto. Time automatically leads to wealth.
In reality, the most important thing in crypto is not getting rich fast. It is surviving long enough to reach real opportunity.
THE COCKROACHES WHO SURVIVE EVERY CYCLE
These are experienced veterans who have lived through multiple bull and bear cycles. They saw the collapse of the 2017 ICO bubble. They experienced the rise and fall of DeFi Summer. They participated in the NFT frenzy. They were hurt by FTX. They were liquidated more than once.
Yet they survived.
They survived because they learned to treat staying in the game as the highest priority. They were rugged. They were hacked. But every event taught them something. Each cycle refined their strategy. Over time, they became more selective, more patient, and more disciplined.
THE CHOSEN ONES
This is the second group. By all logic, they should have lost everything years ago.
They were wiped out more than once. They left funds on FTX and lost them. They were over leveraged and liquidated. But somehow, they survived.
Maybe only part of their capital was lost. Maybe they kept a base position in a cold wallet. Maybe they started over two or three times. Maybe they caught one lucky trade that changed everything.
You can call it luck, a miracle, or stubborn refusal to quit. These people learned survival in the most painful way possible. They gambled until one bet finally worked.
SURVIVORS VS LOSERS
Survivors focus on defense. Losers chase upside.
Survivors Protect capital Only take high probability trades Avoid revenge trading
Losers Chase every move Want fast account growth Think why is everyone else making money instead of asking what they did wrong
If crypto trading were a boxing match, having the strongest punch would not matter if you cannot defend yourself. Trading works the same way. Defense wins long term.
You may have great analysis and strong research skills. But if you cannot protect your capital, none of it matters.
Most people fail because they value making money more than avoiding losses.
THE CORE OF SURVIVAL YOU MUST LOSE ONCE
This is a topic often discussed in the community. Losing everything changes you.
The lesson is brutal but effective. It removes bad habits and kills overconfidence. It teaches you that the market does not care about your emotions or your analysis. The market will humble you quickly.
People who went to zero and came back learned lessons that those who only saw gains never fully understand. They know what the bottom feels like. That knowledge makes them cautious, calculated, and patient.
If you understood survival from the beginning, you would not need to lose everything to learn it.
If you learned position sizing early, you would not get liquidated. If you practiced risk management early, you would not need to lose it all. If you prioritized capital protection before profits, you would not need to start over. If you learned from others mistakes instead of your own, you would save that tuition cost.
THE SURVIVAL TRAP
Being careful is good. But once you focus too much on not losing, another problem appears.
You stop waiting for good opportunities and start waiting for perfect ones. Perfect opportunities are rare. Over time, you miss everything.
New narratives appear and you say no one is talking about it. I will skip it. Good entry points appear and you say it is too late. Probably a trap.
Each missed opportunity hurts your confidence. Fear of loss slowly replaces the desire to win.
Risk, when calculated and sized correctly, is the only way to make money.
Many people who were wiped out fall into this survival trap. They become permanent analysts. They watch assets go from one hundred to five hundred while saying they are waiting for a pullback. Survival without execution is just watching.
We must find balance. Protect downside while still acting when opportunity appears.
If you have been watching for months while opportunities pass, you are likely stuck in the survival trap. The market rewards patience but punishes hesitation.
COMPOUNDED SURVIVAL THE MOST IGNORED FACTOR
Most people ignore compounded survival.
Imagine making two big wins, then suffering two heavy losses of eighty percent and ninety percent. Your capital ends up far below where you started.
Now compare that with a disciplined trader who makes steady gains of forty to fifty percent and avoids deep drawdowns. Over time, their capital grows multiple times.
This shows a harsh truth. Smaller consistent wins with patience often beat extreme volatility. Real compounding is not about finding a one hundred times trade. It is about steady growth.
RISK MANAGEMENT
Everyone should understand these principles.
Position sizing Never put so much into one trade that losing it would end your journey. If you cannot accept a position going to zero, it is too large.
Counterparty risk Do not leave too much capital on centralized exchanges. If you do not control the keys, you do not control the assets. No exchange is too big to fail.
Leverage doubles losses Leverage amplifies gains and losses. The market has no mercy for over leveraged positions. Use leverage only if you fully accept the risk.
Liquidity management Always keep capital available. When others panic, having funds gives you opportunity. The best entries appear when fear is extreme.
Emotional control Set rules before emotions take over. Step away after large losses. Take profits when ahead. Avoid revenge trading and fear driven entries.
The goal of risk management is to survive until the next opportunity.
WAITING FOR THE RIGHT OPPORTUNITY
Waiting is one of the most important parts of trading.
Traders track new narratives, follow smart money, read research, and compare current events with past cycles.
You do not need to trade everything. Wanting to participate in every event is why people lose. Sometimes not trading is a trade.
THE COMPARISON TRAP
Social media creates an illusion that everyone else is making money.
You do not see the liquidated accounts. Survivorship bias is real. Only winners post results.
When people ask why you have not gotten rich yet, they ignore reality.
There were long bear markets where doing nothing was correct. FTX wiped out users funds. Flash crashes liquidated leverage. Scams and rugs appeared without warning. Time was spent learning instead of gambling.
Stop comparing. Everyone has different capital and risk tolerance. Progress in knowledge, capital, and positioning is real progress.
LEARN FIRST EARN LATER
Every successful trader goes through a learning phase. During this time, life changing profits are rare. You are paying for mistakes and understanding market psychology, cycles, and narratives.
Some people try to skip this phase. They enter during bull markets, win a few times, and think they understand everything. When conditions change, they lose it all.
Veterans spent years learning. Reading whitepapers. Studying layer one design. Understanding DeFi mechanics. Learning how value is created and how value is extracted.
The lucky ones eventually realize that learning is required. Repeated loss makes that clear.
SURVIVE LONG ENOUGH FOR THE NEXT CYCLE
Your job is to still be here when the next real opportunity arrives.
After FTX, many said crypto was finished. Those who survived stayed in the market. When the next cycle began, they were ready.
After flash crashes and liquidations, people called the top again. Each disaster removes participants and creates new survivors.
Bitcoin was not supposed to succeed. Ethereum was not supposed to succeed. NFTs were supposed to go to zero. Every bear market was called the end.
Yet something new always emerged.
The real key is not catching the next explosion. It is staying in the game long enough to see it. Speed is not what wins. Survival, discipline, and steady accumulation are what separate those who last from those who disappear.
Do you want to sprint, or do you want to be the one still standing at the end?
〈Why 90% of Crypto Traders Lose Money and Only Two Types of People Survive〉這篇文章最早發佈於《CoinRank》。
The only people who consistently survive are long term veterans who learn from repeated cycles, and highly resilient risk takers who survive multiple failures and eventually adopt discipline.
Sustainable success in crypto comes from risk management, patience, and steady compounding, not from chasing leverage, hype, or one time outsized wins.
INTRODUCTION
In the crypto world, there have been too many stories about one hundred times gains. Because of this, most people enter the market with only one goal. They want to make fast money.
But almost all data points to the same outcome. Most people eventually leave the market with losses.
This article will not teach you how to find the next big winner. Instead, it focuses on something more important. How to survive in a brutal market.
SURVIVAL COMES FIRST PROFITS COME SECOND
Only by protecting your capital can you stay in the game.
Most people enter crypto believing it is a shortcut to wealth. They want to earn a large amount of money in the shortest time possible. This misunderstanding is the main reason why so many people fail.
There is a common myth in crypto. Time automatically leads to wealth.
In reality, the most important thing in crypto is not getting rich fast. It is surviving long enough to reach real opportunity.
THE COCKROACHES WHO SURVIVE EVERY CYCLE
These are experienced veterans who have lived through multiple bull and bear cycles. They saw the collapse of the 2017 ICO bubble. They experienced the rise and fall of DeFi Summer. They participated in the NFT frenzy. They were hurt by FTX. They were liquidated more than once.
Yet they survived.
They survived because they learned to treat staying in the game as the highest priority. They were rugged. They were hacked. But every event taught them something. Each cycle refined their strategy. Over time, they became more selective, more patient, and more disciplined.
THE CHOSEN ONES
This is the second group. By all logic, they should have lost everything years ago.
They were wiped out more than once. They left funds on FTX and lost them. They were over leveraged and liquidated. But somehow, they survived.
Maybe only part of their capital was lost. Maybe they kept a base position in a cold wallet. Maybe they started over two or three times. Maybe they caught one lucky trade that changed everything.
You can call it luck, a miracle, or stubborn refusal to quit. These people learned survival in the most painful way possible. They gambled until one bet finally worked.
SURVIVORS VS LOSERS
Survivors focus on defense. Losers chase upside.
Survivors Protect capital Only take high probability trades Avoid revenge trading
Losers Chase every move Want fast account growth Think why is everyone else making money instead of asking what they did wrong
If crypto trading were a boxing match, having the strongest punch would not matter if you cannot defend yourself. Trading works the same way. Defense wins long term.
You may have great analysis and strong research skills. But if you cannot protect your capital, none of it matters.
Most people fail because they value making money more than avoiding losses.
THE CORE OF SURVIVAL YOU MUST LOSE ONCE
This is a topic often discussed in the community. Losing everything changes you.
The lesson is brutal but effective. It removes bad habits and kills overconfidence. It teaches you that the market does not care about your emotions or your analysis. The market will humble you quickly.
People who went to zero and came back learned lessons that those who only saw gains never fully understand. They know what the bottom feels like. That knowledge makes them cautious, calculated, and patient.
If you understood survival from the beginning, you would not need to lose everything to learn it.
If you learned position sizing early, you would not get liquidated. If you practiced risk management early, you would not need to lose it all. If you prioritized capital protection before profits, you would not need to start over. If you learned from others mistakes instead of your own, you would save that tuition cost.
THE SURVIVAL TRAP
Being careful is good. But once you focus too much on not losing, another problem appears.
You stop waiting for good opportunities and start waiting for perfect ones. Perfect opportunities are rare. Over time, you miss everything.
New narratives appear and you say no one is talking about it. I will skip it. Good entry points appear and you say it is too late. Probably a trap.
Each missed opportunity hurts your confidence. Fear of loss slowly replaces the desire to win.
Risk, when calculated and sized correctly, is the only way to make money.
Many people who were wiped out fall into this survival trap. They become permanent analysts. They watch assets go from one hundred to five hundred while saying they are waiting for a pullback. Survival without execution is just watching.
We must find balance. Protect downside while still acting when opportunity appears.
If you have been watching for months while opportunities pass, you are likely stuck in the survival trap. The market rewards patience but punishes hesitation.
COMPOUNDED SURVIVAL THE MOST IGNORED FACTOR
Most people ignore compounded survival.
Imagine making two big wins, then suffering two heavy losses of eighty percent and ninety percent. Your capital ends up far below where you started.
Now compare that with a disciplined trader who makes steady gains of forty to fifty percent and avoids deep drawdowns. Over time, their capital grows multiple times.
This shows a harsh truth. Smaller consistent wins with patience often beat extreme volatility. Real compounding is not about finding a one hundred times trade. It is about steady growth.
RISK MANAGEMENT
Everyone should understand these principles.
Position sizing Never put so much into one trade that losing it would end your journey. If you cannot accept a position going to zero, it is too large.
Counterparty risk Do not leave too much capital on centralized exchanges. If you do not control the keys, you do not control the assets. No exchange is too big to fail.
Leverage doubles losses Leverage amplifies gains and losses. The market has no mercy for over leveraged positions. Use leverage only if you fully accept the risk.
Liquidity management Always keep capital available. When others panic, having funds gives you opportunity. The best entries appear when fear is extreme.
Emotional control Set rules before emotions take over. Step away after large losses. Take profits when ahead. Avoid revenge trading and fear driven entries.
The goal of risk management is to survive until the next opportunity.
WAITING FOR THE RIGHT OPPORTUNITY
Waiting is one of the most important parts of trading.
Traders track new narratives, follow smart money, read research, and compare current events with past cycles.
You do not need to trade everything. Wanting to participate in every event is why people lose. Sometimes not trading is a trade.
THE COMPARISON TRAP
Social media creates an illusion that everyone else is making money.
You do not see the liquidated accounts. Survivorship bias is real. Only winners post results.
When people ask why you have not gotten rich yet, they ignore reality.
There were long bear markets where doing nothing was correct. FTX wiped out users funds. Flash crashes liquidated leverage. Scams and rugs appeared without warning. Time was spent learning instead of gambling.
Stop comparing. Everyone has different capital and risk tolerance. Progress in knowledge, capital, and positioning is real progress.
LEARN FIRST EARN LATER
Every successful trader goes through a learning phase. During this time, life changing profits are rare. You are paying for mistakes and understanding market psychology, cycles, and narratives.
Some people try to skip this phase. They enter during bull markets, win a few times, and think they understand everything. When conditions change, they lose it all.
Veterans spent years learning. Reading whitepapers. Studying layer one design. Understanding DeFi mechanics. Learning how value is created and how value is extracted.
The lucky ones eventually realize that learning is required. Repeated loss makes that clear.
SURVIVE LONG ENOUGH FOR THE NEXT CYCLE
Your job is to still be here when the next real opportunity arrives.
After FTX, many said crypto was finished. Those who survived stayed in the market. When the next cycle began, they were ready.
After flash crashes and liquidations, people called the top again. Each disaster removes participants and creates new survivors.
Bitcoin was not supposed to succeed. Ethereum was not supposed to succeed. NFTs were supposed to go to zero. Every bear market was called the end.
Yet something new always emerged.
The real key is not catching the next explosion. It is staying in the game long enough to see it. Speed is not what wins. Survival, discipline, and steady accumulation are what separate those who last from those who disappear.
Do you want to sprint, or do you want to be the one still standing at the end?
〈Why 90% of Crypto Traders Lose Money and Only Two Types of People Survive〉這篇文章最早發佈於《CoinRank》。
SPACEX, OPENAI, AND ANTHROPIC MAY LAUNCH IPOS IN 2026, POTENTIALLY MARKING ONE OF THE LARGEST LISTING WAVES IN HISTORY
According to Financial Times, three major U.S. private tech giants—#SpaceX , #OpenAI , and #Anthropic —are preparing for potential IPOs in 2026, with expected fundraising totaling hundreds of billions of dollars.
OpenAI could be valued at up to $750 billion, SpaceX’s secondary market valuation has reached around $800 billion, and Anthropic is reportedly seeking financing at a valuation exceeding $300 billion.
If all three companies go public, their combined #IPO scale would surpass the total size of the U.S. IPO market in 2025, potentially delivering unprecedented returns for investment banks and venture capital firms.
According to Financial Times, three major U.S. private tech giants—#SpaceX , #OpenAI , and #Anthropic —are preparing for potential IPOs in 2026, with expected fundraising totaling hundreds of billions of dollars.
OpenAI could be valued at up to $750 billion, SpaceX’s secondary market valuation has reached around $800 billion, and Anthropic is reportedly seeking financing at a valuation exceeding $300 billion.
If all three companies go public, their combined #IPO scale would surpass the total size of the U.S. IPO market in 2025, potentially delivering unprecedented returns for investment banks and venture capital firms.
CoinRank Daily Data Report (1/4)｜Geopolitical shock triggers brief BTC volatility, meme coins sur...
Bitcoin showed strong short term resilience, quickly recovering after U.S. military action in Venezuela triggered a brief risk off reaction.
Meme coins led by Dogecoin and PEPE outperformed as traders rotated into high beta assets amid range bound bitcoin and uneven liquidity.
XRP outperformed major assets, supported by steady spot ETF inflows and rising expectations for a more crypto friendly U.S. regulatory backdrop.
Welcome to CoinRank Daily Data Report. In this column series, CoinRank will provide important daily cryptocurrency data news, allowing readers to quickly understand the latest developments in the cryptocurrency market.
Bitcoin dips briefly before rebounding amid U.S. military action in Venezuela
The United States launched a military operation against Venezuela and captured President Nicolas Maduro and his wife. The news triggered a short lived risk reaction in crypto markets, with bitcoin dipping around 0.5% to near $89,300 before quickly recovering to just below $90,000. Price action suggested a temporary geopolitical shock rather than a structural shift in market sentiment.
Dogecoin and PEPE lead meme coin rally as speculative appetite returns
Dogecoin rose about 11% and PEPE surged roughly 17% in 24 hours, kicking off 2026 with strong momentum in the meme coin sector. CoinGecko’s GMCI Meme Index showed a total market value of $33.8 billion and 24 hour trading volume of $5.9 billion. With bitcoin range bound and macro catalysts limited, traders turned to meme assets as a high beta outlet for short term risk taking.
XRP jumps above $2 as ETF inflows and regulatory expectations improve
XRP climbed more than 8% to above $2 for the first time since mid December. U.S. spot XRP ETFs recorded $13.59 million in net inflows on Jan 2, bringing cumulative inflows since launch to $1.18 billion. The rally was further supported by expectations of a more crypto friendly U.S. regulatory environment following the departure of SEC Commissioner Caroline Crenshaw.
〈CoinRank Daily Data Report (1/4)｜Geopolitical shock triggers brief BTC volatility, meme coins surge to open 2026, XRP rallies on ETF inflows and regulatory optimism〉這篇文章最早發佈於《CoinRank》。
Meme coins led by Dogecoin and PEPE outperformed as traders rotated into high beta assets amid range bound bitcoin and uneven liquidity.
XRP outperformed major assets, supported by steady spot ETF inflows and rising expectations for a more crypto friendly U.S. regulatory backdrop.
Welcome to CoinRank Daily Data Report. In this column series, CoinRank will provide important daily cryptocurrency data news, allowing readers to quickly understand the latest developments in the cryptocurrency market.
Bitcoin dips briefly before rebounding amid U.S. military action in Venezuela
The United States launched a military operation against Venezuela and captured President Nicolas Maduro and his wife. The news triggered a short lived risk reaction in crypto markets, with bitcoin dipping around 0.5% to near $89,300 before quickly recovering to just below $90,000. Price action suggested a temporary geopolitical shock rather than a structural shift in market sentiment.
Dogecoin and PEPE lead meme coin rally as speculative appetite returns
Dogecoin rose about 11% and PEPE surged roughly 17% in 24 hours, kicking off 2026 with strong momentum in the meme coin sector. CoinGecko’s GMCI Meme Index showed a total market value of $33.8 billion and 24 hour trading volume of $5.9 billion. With bitcoin range bound and macro catalysts limited, traders turned to meme assets as a high beta outlet for short term risk taking.
XRP jumps above $2 as ETF inflows and regulatory expectations improve
XRP climbed more than 8% to above $2 for the first time since mid December. U.S. spot XRP ETFs recorded $13.59 million in net inflows on Jan 2, bringing cumulative inflows since launch to $1.18 billion. The rally was further supported by expectations of a more crypto friendly U.S. regulatory environment following the departure of SEC Commissioner Caroline Crenshaw.
〈CoinRank Daily Data Report (1/4)｜Geopolitical shock triggers brief BTC volatility, meme coins surge to open 2026, XRP rallies on ETF inflows and regulatory optimism〉這篇文章最早發佈於《CoinRank》。
COINRANK EVENING UPDATE
#FalconX co-founder: 2026 core focus is prediction markets and on-chain equity
#Jupiter co-founder inquires with the community whether JUP buybacks should be suspended to explore new reward mechanisms;
Analysis: Bitcoin's recent pullback is weaker than the previous cycle; optimists bet on a year-end surge to $150,000;
#CryptoQuant Research Director: Market misjudged whale behavior; Bitcoin's real demand is slowing and approaching negative territory;
#Folw tweets that it has resumed operation, with Cadence and EVM launching simultaneously.
#Coinrank
#Jupiter co-founder inquires with the community whether JUP buybacks should be suspended to explore new reward mechanisms;
Analysis: Bitcoin's recent pullback is weaker than the previous cycle; optimists bet on a year-end surge to $150,000;
#CryptoQuant Research Director: Market misjudged whale behavior; Bitcoin's real demand is slowing and approaching negative territory;
#Folw tweets that it has resumed operation, with Cadence and EVM launching simultaneously.
#Coinrank
HELIUM FOUNDER: HNT BUYBACKS TO BE HALTED DUE TO WEAK MARKET RESPONSE
#Helium founder Amir said that the market appears indifferent to project-led token buybacks, and under current conditions the team will stop spending funds on HNT buybacks.
He noted that Helium + Mobile generated $3.4 million in revenue in October alone, and said he would rather use that capital to grow the business.
He noted that Helium + Mobile generated $3.4 million in revenue in October alone, and said he would rather use that capital to grow the business.
DATA: METEORA, JUPITER, AND UNISWAP EACH GENERATED OVER $1 BILLION IN FEES IN 2025
According to #Cryptodiffer data, #Meteora , #Jupiter , and #Uniswap ranked first, second, and third respectively among #DeFi protocols by total fees generated in 2025, each surpassing $1 billion.
Their total fee revenues reached $1.25 billion, $1.11 billion, and $1.06 billion.
According to #Cryptodiffer data, #Meteora , #Jupiter , and #Uniswap ranked first, second, and third respectively among #DeFi protocols by total fees generated in 2025, each surpassing $1 billion.
Their total fee revenues reached $1.25 billion, $1.11 billion, and $1.06 billion.
COINRANK MIDDAY UPDATE
#Trump claims to have captured Maduro and taken him out of Venezuela; he previously championed the "Petro" cryptocurrency to counter US sanctions.
#Ethereum treasury company Quantum Solutions discloses ETH holdings have increased to approximately 5,418.
#Bitmine further increases staking, causing a surge in ETH holdings in the validation queue, extending the waiting period to 17 days.
#Helium founder: Due to lukewarm market response, HNT token buybacks will be halted.
Robinhood will release its full-year 2025 earnings report on February 10th.
#CoinRank
#Ethereum treasury company Quantum Solutions discloses ETH holdings have increased to approximately 5,418.
#Bitmine further increases staking, causing a surge in ETH holdings in the validation queue, extending the waiting period to 17 days.
#Helium founder: Due to lukewarm market response, HNT token buybacks will be halted.
Robinhood will release its full-year 2025 earnings report on February 10th.
#CoinRank
COINRANK WEEKLY REPORT
⏰2025/12/29 - 2026/1/4 | This Week's Top Events: What Did You Miss?
Market Weekend Recap
Here's a quick look at the key headlines from this weekend👇
#CoinRank #CryptoNews #CryptoMarket #CryptoTrading
Market Weekend Recap
Here's a quick look at the key headlines from this weekend👇
#CoinRank #CryptoNews #CryptoMarket #CryptoTrading
COINRANK MORNING UPDATE
#Bitfinex hack participant Ilya Lichtenstein to be released early
#Glassnode : Current market structure exhibits typical characteristics of a long-term bear market
#Infinex founder pays $50,000 to Multicoin co-founder after losing a bet on ETH price
10x Research: Crypto market is shifting from defense to opportunity; the next phase favors discipline and active position management
#Tether invests in cross-border QR code payment platform SQRIL;
#CoinRank
#Glassnode : Current market structure exhibits typical characteristics of a long-term bear market
#Infinex founder pays $50,000 to Multicoin co-founder after losing a bet on ETH price
10x Research: Crypto market is shifting from defense to opportunity; the next phase favors discipline and active position management
#Tether invests in cross-border QR code payment platform SQRIL;
#CoinRank
AAVE PLANS TO EXPLORE SHARING OFF-PROTOCOL REVENUE WITH TOKEN HOLDERS, SUPPORTING PERMISSIONLESS BUILDING ON THE PROTOCOL
Amid recent governance disagreements, Aave founder Stani Kulechov wrote on the governance forum that Aave plans to share revenue generated outside the core protocol with AAVE token holders, and will soon submit a formal proposal outlining the specific mechanisms.
He emphasized the need for a shared long-term vision, supporting teams to build products permissionlessly on top of the Aave protocol, while creating sustainable value for the DAO and token holders by expanding into RWA, new lending models, and institutional-grade use cases.
#AAVE #DAO #RWA
Amid recent governance disagreements, Aave founder Stani Kulechov wrote on the governance forum that Aave plans to share revenue generated outside the core protocol with AAVE token holders, and will soon submit a formal proposal outlining the specific mechanisms.
He emphasized the need for a shared long-term vision, supporting teams to build products permissionlessly on top of the Aave protocol, while creating sustainable value for the DAO and token holders by expanding into RWA, new lending models, and institutional-grade use cases.
#AAVE #DAO #RWA
GN🌙 CoinRank Evening Headlines!
Amir Zaidi will return to the CFTC as chief of staff, signaling tighter crypto oversight ahead of new digital asset legislation.
India’s central bank is urging countries to prioritize CBDCs over private stablecoins, though only a few nations have successfully launched one so far.
Bitcoin continues to lag traditional assets, down about 20% since November, while gold and the S&P 500 have posted gains.
U.S. Representative Warren Davidson warned that digital IDs and CBDCs could lead to a surveillance state and weaken financial privacy.
Bitcoin remains below key resistance, with rising miner outflows adding to short-term downside risk.
#CoinRank #GN #CryptoNews
Amir Zaidi will return to the CFTC as chief of staff, signaling tighter crypto oversight ahead of new digital asset legislation.
India’s central bank is urging countries to prioritize CBDCs over private stablecoins, though only a few nations have successfully launched one so far.
Bitcoin continues to lag traditional assets, down about 20% since November, while gold and the S&P 500 have posted gains.
U.S. Representative Warren Davidson warned that digital IDs and CBDCs could lead to a surveillance state and weaken financial privacy.
Bitcoin remains below key resistance, with rising miner outflows adding to short-term downside risk.
#CoinRank #GN #CryptoNews
Saylor Says Bitcoin Made MicroStrategy Interesting
Bitcoin exposure has driven MSTR’s derivatives open interest to extreme levels, signaling heavy leverage speculation around MicroStrategy stock.
Despite the hype, MSTR shares are down about 50% in 2025, far underperforming Bitcoin, with mNAV compressing toward parity.
Rising STRC dividends and potential MSCI index exclusion add financial and structural risks for MicroStrategy investors.
Michael Saylor says Bitcoin made MicroStrategy (MSTR) interesting as derivatives open interest soars, mNAV compresses, dividends rise, and MSCI index risks loom.
MicroStrategy founder Michael Saylor, a pioneer of the Bitcoin treasury strategy, recently pointed out that MSTR’s open interest notional value far exceeds that of other tech giants, arguing that Bitcoin is what made MSTR “interesting.”
However, MSTR shares have fallen about 50% so far in 2025—significantly underperforming Bitcoin’s roughly 6% decline—prompting some observers to question whether the stock’s weakness is largely the result of heavy short selling.
OPEN INTEREST SURGES: HAS BITCOIN-DRIVEN LEVERAGE SPECULATION MADE MSTR “INTERESTING”?
Michael Saylor compared MSTR’s open interest notional value with that of other major tech stocks, arguing that Bitcoin is what made MSTR interesting. According to the chart, MSTR’s ratio of derivatives open interest to market capitalization stands at 86%—far above Tesla’s 22% and Microsoft’s 3%. In Saylor’s view, Bitcoin integration has significantly increased the stock’s appeal to traders seeking leveraged exposure to Bitcoin.
In equity markets, a stock’s “open interest” (OI) typically refers to the total number of outstanding derivatives contracts—such as options or futures—linked to that stock. Comparing the notional value of these derivatives’ open interest with the company’s market capitalization serves as a proxy for the degree of leverage speculation and the influence of the derivatives market on the stock’s price. When this ratio becomes excessively high, it suggests that a large amount of speculative capital is actively betting on the stock.
WEAK SHARE PRICE PROMPTS ANOTHER DIVIDEND HIKE ON STRC TO 11%
MicroStrategy also announced that it has raised the dividend rate on its perpetual preferred stock STRC to 11%. Because the company originally targeted a trading range of 99–101 for STRC, increasing the dividend yield has become the primary tool to support the stock price. This marks the second dividend increase since STRC was issued in July last year.
>>> More to read: Who is Michael Saylor? Founder of MicroStrategy
MNAV PREMIUM COMPRESSION AND POTENTIAL MSCI INDEX ADJUSTMENT RISKS
MSTR has fallen about 50% so far in 2025, significantly underperforming Bitcoin’s roughly 6% decline. As a result, its mNAV—the ratio between the current share price and the value of the Bitcoin it holds—has compressed toward parity, approaching a level of 1.
The market is now awaiting a decision from global index provider MSCI on January 15 regarding whether Strategy and other DAT companies could be removed from its indices, a move that could introduce additional downside risk.
>>> More to read: What is MicroStrategy (MSTR)? From Data to Digital Gold
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〈Saylor Says Bitcoin Made MicroStrategy Interesting〉這篇文章最早發佈於《CoinRank》。
Despite the hype, MSTR shares are down about 50% in 2025, far underperforming Bitcoin, with mNAV compressing toward parity.
Rising STRC dividends and potential MSCI index exclusion add financial and structural risks for MicroStrategy investors.
Michael Saylor says Bitcoin made MicroStrategy (MSTR) interesting as derivatives open interest soars, mNAV compresses, dividends rise, and MSCI index risks loom.
MicroStrategy founder Michael Saylor, a pioneer of the Bitcoin treasury strategy, recently pointed out that MSTR’s open interest notional value far exceeds that of other tech giants, arguing that Bitcoin is what made MSTR “interesting.”
However, MSTR shares have fallen about 50% so far in 2025—significantly underperforming Bitcoin’s roughly 6% decline—prompting some observers to question whether the stock’s weakness is largely the result of heavy short selling.
OPEN INTEREST SURGES: HAS BITCOIN-DRIVEN LEVERAGE SPECULATION MADE MSTR “INTERESTING”?
Michael Saylor compared MSTR’s open interest notional value with that of other major tech stocks, arguing that Bitcoin is what made MSTR interesting. According to the chart, MSTR’s ratio of derivatives open interest to market capitalization stands at 86%—far above Tesla’s 22% and Microsoft’s 3%. In Saylor’s view, Bitcoin integration has significantly increased the stock’s appeal to traders seeking leveraged exposure to Bitcoin.
In equity markets, a stock’s “open interest” (OI) typically refers to the total number of outstanding derivatives contracts—such as options or futures—linked to that stock. Comparing the notional value of these derivatives’ open interest with the company’s market capitalization serves as a proxy for the degree of leverage speculation and the influence of the derivatives market on the stock’s price. When this ratio becomes excessively high, it suggests that a large amount of speculative capital is actively betting on the stock.
WEAK SHARE PRICE PROMPTS ANOTHER DIVIDEND HIKE ON STRC TO 11%
MicroStrategy also announced that it has raised the dividend rate on its perpetual preferred stock STRC to 11%. Because the company originally targeted a trading range of 99–101 for STRC, increasing the dividend yield has become the primary tool to support the stock price. This marks the second dividend increase since STRC was issued in July last year.
>>> More to read: Who is Michael Saylor? Founder of MicroStrategy
MNAV PREMIUM COMPRESSION AND POTENTIAL MSCI INDEX ADJUSTMENT RISKS
MSTR has fallen about 50% so far in 2025, significantly underperforming Bitcoin’s roughly 6% decline. As a result, its mNAV—the ratio between the current share price and the value of the Bitcoin it holds—has compressed toward parity, approaching a level of 1.
The market is now awaiting a decision from global index provider MSCI on January 15 regarding whether Strategy and other DAT companies could be removed from its indices, a move that could introduce additional downside risk.
>>> More to read: What is MicroStrategy (MSTR)? From Data to Digital Gold
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〈Saylor Says Bitcoin Made MicroStrategy Interesting〉這篇文章最早發佈於《CoinRank》。
A trader claims to have made $1 million by capitalizing on what they described as "abnormal" market maker activity involving the BROCCOLI714 memecoin. According to @lookonchain, the individual timed a long-short trade on a major exchange, which later confirmed there was no security breach.
What is Proof of Burn (PoB)?
Proof of Burn (POB) secures blockchain networks by requiring participants to destroy tokens as an irreversible economic commitment.
By replacing hardware and electricity with token burning, Proof of Burn (POB) aims to reduce energy consumption while preserving incentive alignment.
Despite its potential benefits, Proof of Burn (POB) remains debated, with open questions around scalability, transparency, and real-world adoption.
Proof of Burn (POB) is a blockchain consensus mechanism that secures networks by permanently burning tokens, replacing energy-intensive mining with economic commitment.
WHAT IS PROOF OF BURN (POB)?
Proof of Burn (POB) is a blockchain consensus concept that exists in several variations, but the version most widely recognized in the crypto industry was proposed by Iain Stewart. It was introduced as a more sustainable alternative to traditional consensus models, particularly as a way to rethink how long-term network commitment can be established without relying on heavy resource consumption.
At a conceptual level, Proof of Burn (POB) can be viewed as a lower-energy counterpart to Proof of Work. Instead of requiring miners to compete through raw computational power or specialized hardware such as ASICs, PoB replaces physical resource expenditure with intentional economic sacrifice. In this model, cryptocurrencies are deliberately destroyed—or “burned”—as a form of investment into the blockchain network.
Under a Proof of Burn (POB) system, miners do not invest in hardware or electricity. Instead, they allocate capital to what can be described as a virtual mining platform, where burned tokens represent virtual mining power. This design removes the need for continuous energy consumption while preserving a cost-based mechanism for participation.
In practical terms, burning tokens allows participants to demonstrate their long-term commitment to the network and earn the right to validate transactions and produce blocks. The act of burning coins functions as a proxy for mining power: the more tokens a participant destroys, the greater their virtual hash power within the system.
As a result, in a Proof of Burn (POB) consensus model, users who burn larger amounts of cryptocurrency gain a higher probability of being selected as the next block validator. This approach shifts competition away from physical resources and toward economic commitment, forming the core logic behind the PoB consensus mechanism.
>>> More to read: What is Proof of Stake (PoS)?
HOW DOES PROOF OF BURN WORK?
At a basic level, Proof of Burn (POB) works by permanently removing tokens from circulation. This is done by sending coins to a publicly verifiable address where they can no longer be accessed, owned, or spent. In most cases, these burn addresses are randomly generated addresses with no known private key, ensuring that the burned coins are effectively lost forever.
From a market perspective, burning tokens reduces circulating supply and introduces scarcity, which may contribute to potential value appreciation over time. However, in the context of Proof of Burn (POB), scarcity is not the primary objective. More importantly, token burning functions as an alternative form of investment used to help secure the blockchain network.
One of the reasons Proof of Work blockchains are considered secure is that miners must commit substantial real-world resources before they can earn rewards. This upfront cost—whether in electricity, hardware, or operational expenses—creates a strong incentive for miners to act honestly, since malicious behavior would risk wasting their initial investment.
Proof of Burn (POB) follows a similar incentive logic, but replaces physical resource consumption with economic sacrifice. Instead of investing electricity, labor, or computational power, participants secure the network by burning coins. The burned tokens themselves represent the cost of participation and the miner’s commitment to the system.
Like Proof of Work blockchains, Proof of Burn (POB) systems reward miners with block rewards. Over time, these rewards are expected to compensate for the initial cost of burned coins, aligning long-term incentives between network security and participant profitability.
As mentioned earlier, there are multiple ways to implement Proof of Burn (POB). Some projects require participants to burn Bitcoin in order to gain mining or validation rights, while others achieve consensus by burning their own native cryptocurrencies. Despite these variations, the underlying principle remains the same: long-term network security is enforced through irreversible economic commitment rather than ongoing physical resource expenditure.
>>> More to read: What is Proof of Work (PoW)?
PROS AND CONS OF PROOF OF BURN
The advantages and disadvantages outlined below are based on commonly cited arguments from supporters of Proof of Burn (POB). They should not be treated as established facts. Many of these claims remain debated within the crypto community and require further testing and real-world validation before they can be confirmed or dismissed.
✅ Advantages
One of the most frequently mentioned benefits of Proof of Burn (POB) is sustainability. Because the mechanism does not rely on continuous computational work, it is often described as more energy-efficient compared to traditional mining-based systems.
Another advantage is that Proof of Burn (POB) eliminates the need for specialized mining hardware. Instead of physical machines, token burning acts as a form of virtual mining power, lowering the barrier to participation.
Burning cryptocurrency also reduces circulating supply, introducing scarcity into the market. While this is not the primary goal of Proof of Burn (POB), it is often cited as a secondary economic effect.
Supporters further argue that Proof of Burn (POB) encourages long-term commitment from miners. Because burned tokens cannot be recovered, participants are incentivized to behave honestly and remain engaged with the network over time.
Finally, some proponents believe that Proof of Burn (POB) can lead to a more decentralized distribution of mining or validation power, as participation is not dominated by access to industrial-scale hardware or cheap electricity.
❗Disadvantages
Critics argue that Proof of Burn (POB) is not truly environmentally friendly. In cases where Bitcoin is burned, those coins were originally produced through Proof of Work mining, which already consumed significant energy and resources.
Another concern is scalability. There is currently no conclusive evidence that Proof of Burn (POB) can operate efficiently or securely at the scale of large blockchain networks. More testing and real-world deployment are needed to evaluate its long-term viability.
Verification delays are also cited as a drawback. Compared to Proof of Work systems, validation and confirmation of miner activity in Proof of Burn (POB) networks may take longer, reducing responsiveness.
Lastly, the token-burning process itself is not always fully transparent or easily verifiable by average users. In some implementations, it may be difficult for non-technical participants to independently confirm that coins have truly been burned.
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〈What is Proof of Burn (PoB)?〉這篇文章最早發佈於《CoinRank》。
By replacing hardware and electricity with token burning, Proof of Burn (POB) aims to reduce energy consumption while preserving incentive alignment.
Despite its potential benefits, Proof of Burn (POB) remains debated, with open questions around scalability, transparency, and real-world adoption.
Proof of Burn (POB) is a blockchain consensus mechanism that secures networks by permanently burning tokens, replacing energy-intensive mining with economic commitment.
WHAT IS PROOF OF BURN (POB)?
Proof of Burn (POB) is a blockchain consensus concept that exists in several variations, but the version most widely recognized in the crypto industry was proposed by Iain Stewart. It was introduced as a more sustainable alternative to traditional consensus models, particularly as a way to rethink how long-term network commitment can be established without relying on heavy resource consumption.
At a conceptual level, Proof of Burn (POB) can be viewed as a lower-energy counterpart to Proof of Work. Instead of requiring miners to compete through raw computational power or specialized hardware such as ASICs, PoB replaces physical resource expenditure with intentional economic sacrifice. In this model, cryptocurrencies are deliberately destroyed—or “burned”—as a form of investment into the blockchain network.
Under a Proof of Burn (POB) system, miners do not invest in hardware or electricity. Instead, they allocate capital to what can be described as a virtual mining platform, where burned tokens represent virtual mining power. This design removes the need for continuous energy consumption while preserving a cost-based mechanism for participation.
In practical terms, burning tokens allows participants to demonstrate their long-term commitment to the network and earn the right to validate transactions and produce blocks. The act of burning coins functions as a proxy for mining power: the more tokens a participant destroys, the greater their virtual hash power within the system.
As a result, in a Proof of Burn (POB) consensus model, users who burn larger amounts of cryptocurrency gain a higher probability of being selected as the next block validator. This approach shifts competition away from physical resources and toward economic commitment, forming the core logic behind the PoB consensus mechanism.
>>> More to read: What is Proof of Stake (PoS)?
HOW DOES PROOF OF BURN WORK?
At a basic level, Proof of Burn (POB) works by permanently removing tokens from circulation. This is done by sending coins to a publicly verifiable address where they can no longer be accessed, owned, or spent. In most cases, these burn addresses are randomly generated addresses with no known private key, ensuring that the burned coins are effectively lost forever.
From a market perspective, burning tokens reduces circulating supply and introduces scarcity, which may contribute to potential value appreciation over time. However, in the context of Proof of Burn (POB), scarcity is not the primary objective. More importantly, token burning functions as an alternative form of investment used to help secure the blockchain network.
One of the reasons Proof of Work blockchains are considered secure is that miners must commit substantial real-world resources before they can earn rewards. This upfront cost—whether in electricity, hardware, or operational expenses—creates a strong incentive for miners to act honestly, since malicious behavior would risk wasting their initial investment.
Proof of Burn (POB) follows a similar incentive logic, but replaces physical resource consumption with economic sacrifice. Instead of investing electricity, labor, or computational power, participants secure the network by burning coins. The burned tokens themselves represent the cost of participation and the miner’s commitment to the system.
Like Proof of Work blockchains, Proof of Burn (POB) systems reward miners with block rewards. Over time, these rewards are expected to compensate for the initial cost of burned coins, aligning long-term incentives between network security and participant profitability.
As mentioned earlier, there are multiple ways to implement Proof of Burn (POB). Some projects require participants to burn Bitcoin in order to gain mining or validation rights, while others achieve consensus by burning their own native cryptocurrencies. Despite these variations, the underlying principle remains the same: long-term network security is enforced through irreversible economic commitment rather than ongoing physical resource expenditure.
>>> More to read: What is Proof of Work (PoW)?
PROS AND CONS OF PROOF OF BURN
The advantages and disadvantages outlined below are based on commonly cited arguments from supporters of Proof of Burn (POB). They should not be treated as established facts. Many of these claims remain debated within the crypto community and require further testing and real-world validation before they can be confirmed or dismissed.
✅ Advantages
One of the most frequently mentioned benefits of Proof of Burn (POB) is sustainability. Because the mechanism does not rely on continuous computational work, it is often described as more energy-efficient compared to traditional mining-based systems.
Another advantage is that Proof of Burn (POB) eliminates the need for specialized mining hardware. Instead of physical machines, token burning acts as a form of virtual mining power, lowering the barrier to participation.
Burning cryptocurrency also reduces circulating supply, introducing scarcity into the market. While this is not the primary goal of Proof of Burn (POB), it is often cited as a secondary economic effect.
Supporters further argue that Proof of Burn (POB) encourages long-term commitment from miners. Because burned tokens cannot be recovered, participants are incentivized to behave honestly and remain engaged with the network over time.
Finally, some proponents believe that Proof of Burn (POB) can lead to a more decentralized distribution of mining or validation power, as participation is not dominated by access to industrial-scale hardware or cheap electricity.
❗Disadvantages
Critics argue that Proof of Burn (POB) is not truly environmentally friendly. In cases where Bitcoin is burned, those coins were originally produced through Proof of Work mining, which already consumed significant energy and resources.
Another concern is scalability. There is currently no conclusive evidence that Proof of Burn (POB) can operate efficiently or securely at the scale of large blockchain networks. More testing and real-world deployment are needed to evaluate its long-term viability.
Verification delays are also cited as a drawback. Compared to Proof of Work systems, validation and confirmation of miner activity in Proof of Burn (POB) networks may take longer, reducing responsiveness.
Lastly, the token-burning process itself is not always fully transparent or easily verifiable by average users. In some implementations, it may be difficult for non-technical participants to independently confirm that coins have truly been burned.
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Looking for the latest scoop and cool insights from CoinRank? Hit up our Twitter and stay in the loop with all our fresh stories!
〈What is Proof of Burn (PoB)?〉這篇文章最早發佈於《CoinRank》。
What is a Blockchain Bridge?
Blockchain bridges connect isolated networks, enabling cross-chain asset transfers and true interoperability.
By leveraging wrapped assets and sidechains, blockchain bridges improve scalability and reduce transaction costs.
Security remains the key challenge, making robust and well-designed blockchain bridges essential for the multi-chain future.
Blockchain bridges enable interoperability between isolated blockchains, allowing assets and data to move across networks while improving scalability, efficiency, and access to cross-chain applications.
WHY DO WE NEED A BLOCKCHAIN BRIDGE?
As the blockchain ecosystem continues to expand, one fundamental limitation has become increasingly clear: most blockchains cannot natively work with one another. Each blockchain operates under its own rules, tokens, protocols, and smart contract frameworks, creating isolated environments across the crypto landscape.
A Blockchain Bridge exists to break down these barriers. By connecting otherwise separate blockchains, a Blockchain Bridge allows assets and data to move between independent networks, transforming fragmented ecosystems into a more unified and interconnected blockchain network. When blockchains can interact seamlessly, token transfers become more efficient and the overall flow of value improves across the ecosystem.
Beyond enabling cross-chain transfers, a Blockchain Bridge delivers additional benefits. It allows users to access new protocols and applications on other blockchains without being confined to a single network. At the same time, it enables developers from different blockchain communities to collaborate more easily, fostering innovation across ecosystems.
In this sense, a Blockchain Bridge is not just a technical tool—it is a foundational component for the future of blockchain interoperability. As the industry moves toward a more connected and cooperative multi-chain environment, Blockchain Bridges will play a critical role in shaping how decentralized networks evolve and scale.
>>> More to read: What is Blockchain and How Does It Work?
HOW DOES A BLOCKCHAIN BRIDGE WORK?
The most common use case of a Blockchain Bridge is token transfer across different blockchains. For example, imagine you want to move your Bitcoin (BTC) onto the Ethereum network. One straightforward option would be to sell your BTC and purchase Ether (ETH). However, this approach involves transaction fees and exposes you to price volatility during the conversion process.
A Blockchain Bridge offers an alternative way to achieve the same goal—without selling your cryptocurrency. When you bridge 1 BTC to an Ethereum wallet, the Blockchain Bridge smart contract locks your BTC on its original network. At the same time, an equivalent amount of Wrapped Bitcoin (WBTC) is created on Ethereum. WBTC is an ERC-20 token designed to be fully compatible with the Ethereum ecosystem.
In this process, the original BTC remains locked inside a smart contract, while a corresponding token is issued or minted on the destination blockchain. This wrapped token represents the value of the original asset and can be used within the target network just like any other native token.
Wrapped tokens are essentially tokenized versions of another cryptocurrency. Their value is pegged to the underlying asset they represent, and in most cases, they can be redeemed—or “unwrapped”—at any time by reversing the bridging process. Through this mechanism, a Blockchain Bridge enables assets to move across blockchains while preserving ownership and value.
>>> More to read: What is Wrapped Bitcoin (WBTC)?
WHAT TYPES OF BLOCKCHAIN BRIDGES EXIST?
There are several ways to classify a Blockchain Bridge, depending on its trust model, functionality, and operational mechanism. Each category reflects different design trade-offs in security, decentralization, and usability.
✅ Custodial vs. Non-Custodial Blockchain Bridges
One of the most common classifications divides a Blockchain Bridge into two categories: custodial (centralized) and non-custodial (decentralized).
A custodial Blockchain Bridge requires users to trust a central entity to operate the bridge securely and manage locked assets properly. In this model, the bridge operator controls the system, which means users must place confidence in the organization’s operational integrity and security practices. As a result, thorough due diligence is essential before using a custodial bridge.
In contrast, a non-custodial Blockchain Bridge operates in a decentralized manner. It relies on smart contracts to manage the locking and minting of assets, removing the need to trust a centralized bridge operator. Instead of human oversight, security depends entirely on the correctness and robustness of the underlying code. In this setup, trust is shifted from institutions to software.
✅ Blockchain Bridges by Function
Another way to categorize a Blockchain Bridge is based on its primary function, such as wrapped-asset bridges and sidechain bridges.
Wrapped-asset bridges enable interoperability by tokenizing cryptocurrencies from one blockchain for use on another. A common example is converting Bitcoin into Wrapped Bitcoin (WBTC), an ERC-20 token compatible with the Ethereum network. Through this process, Bitcoin can be effectively transferred and utilized within Ethereum-based applications.
Sidechain bridges, on the other hand, connect a main blockchain to its sidechain, allowing assets and data to move between the two. This interoperability is necessary because a main chain and its sidechain often operate under different consensus mechanisms. One example is the xDai bridge, which connects the Ethereum mainnet to the Gnosis Chain (formerly the xDai blockchain). Gnosis Chain functions as an Ethereum-based stable payment sidechain secured by its own validator set, distinct from Ethereum’s validators. The xDai Blockchain Bridge enables users to transfer value smoothly between these two networks.
✅ Blockchain Bridges by Transfer Mechanism
Blockchain Bridges can also be classified by how assets move across chains: one-way or two-way bridges.
A one-way Blockchain Bridge allows users to transfer assets to a destination blockchain without the ability to move them back to the original chain. Once bridged, the assets remain permanently on the target network.
A two-way Blockchain Bridge, by contrast, supports bidirectional transfers. Assets can be bridged to another blockchain and later returned to their native chain by reversing the process. This flexibility makes two-way bridges more versatile for users who actively operate across multiple blockchains.
>>> More to read: What’s the Difference Between Blockchain and Bitcoin?
BENEFITS OF A BLOCKCHAIN BRIDGE
The most important benefit of a Blockchain Bridge is improved interoperability. By enabling assets, tokens, and data to move across different blockchains, a Blockchain Bridge connects otherwise isolated networks into a more cohesive ecosystem. This interoperability applies across Layer 1 and Layer 2 networks, as well as between various sidechains.
For example, Wrapped Bitcoin (WBTC) allows Bitcoin holders to access decentralized applications (DApps) and DeFi services within the Ethereum ecosystem. Without a Blockchain Bridge, such cross-ecosystem participation would not be possible. A highly interoperable blockchain environment is widely considered essential for the long-term success and growth of the industry.
Another key advantage of a Blockchain Bridge lies in scalability. Some bridges are designed to handle a large volume of transactions more efficiently, helping reduce congestion on major networks.
🔍 Key scalability-related benefits include:
Supporting asset transfers between high-security but congested networks and faster, lower-cost chains
Improving transaction speed and lowering fees for users
A well-known example is the Ethereum–Polygon Blockchain Bridge, a decentralized two-way bridge that serves as a scalability solution for Ethereum. By moving transactions to Polygon, users can enjoy faster confirmation times and significantly lower transaction costs while still remaining connected to the Ethereum ecosystem.
RISKS OF A BLOCKCHAIN BRIDGE
Despite their advantages, Blockchain Bridges also come with notable risks and limitations. Over time, attackers have exploited vulnerabilities in certain Blockchain Bridge smart contracts, leading to large-scale losses of cryptocurrency. In fact, cross-chain bridges have historically been among the most frequent targets for high-profile exploits.
One major risk is custodial risk. Custodial Blockchain Bridges require users to trust a centralized entity to safeguard locked assets. In theory, this central operator could misuse or steal user funds. For this reason, users should only consider custodial bridges operated by well-established platforms with a strong and transparent track record.
🔍 Additional risks and limitations include:
Smart contract vulnerabilities that can be exploited by attackers
Transaction throughput bottlenecks that limit large-scale interoperability
Dependence on the security assumptions of multiple blockchains
While a Blockchain Bridge can help relieve network congestion by moving assets to another chain, it does not fully solve scalability challenges. Users do not always migrate together with the same applications and services. For instance, some Ethereum-based DApps may not be supported on Polygon via a Blockchain Bridge, reducing the practical effectiveness of cross-chain scaling.
Finally, Blockchain Bridges can introduce trust fragmentation at the protocol level. Because a Blockchain Bridge connects two distinct blockchains, the overall security of the interconnected system is only as strong as its weakest component. If one network or bridge mechanism is compromised, the risks can propagate across the connected ecosystem.
>>> More to read: What is a Cross-chain Bridge & Why We Need It
CONCLUSION
The development of the blockchain industry has been driven by continuous innovation. Early pioneer networks such as Bitcoin and Ethereum laid the foundation, followed by the emergence of numerous alternative Layer 1 and Layer 2 blockchains. At the same time, cryptocurrencies—whether used as currencies or tokens—have grown at an exponential pace.
Because these blockchains operate under independent rules and technical architectures, Blockchain Bridges are required to connect them. By linking separate networks, a Blockchain Bridge enables a more cohesive and interoperable blockchain ecosystem, opening the door to improved scalability and greater operational efficiency.
As cross-chain attacks targeting Blockchain Bridges have occurred repeatedly, the industry continues to pursue safer and more robust Blockchain Bridge designs. Improving security while maintaining interoperability will remain a critical focus as the multi-chain ecosystem continues to evolve.
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Looking for the latest scoop and cool insights from CoinRank? Hit up our Twitter and stay in the loop with all our fresh stories!
〈What is a Blockchain Bridge?〉這篇文章最早發佈於《CoinRank》。
By leveraging wrapped assets and sidechains, blockchain bridges improve scalability and reduce transaction costs.
Security remains the key challenge, making robust and well-designed blockchain bridges essential for the multi-chain future.
Blockchain bridges enable interoperability between isolated blockchains, allowing assets and data to move across networks while improving scalability, efficiency, and access to cross-chain applications.
WHY DO WE NEED A BLOCKCHAIN BRIDGE?
As the blockchain ecosystem continues to expand, one fundamental limitation has become increasingly clear: most blockchains cannot natively work with one another. Each blockchain operates under its own rules, tokens, protocols, and smart contract frameworks, creating isolated environments across the crypto landscape.
A Blockchain Bridge exists to break down these barriers. By connecting otherwise separate blockchains, a Blockchain Bridge allows assets and data to move between independent networks, transforming fragmented ecosystems into a more unified and interconnected blockchain network. When blockchains can interact seamlessly, token transfers become more efficient and the overall flow of value improves across the ecosystem.
Beyond enabling cross-chain transfers, a Blockchain Bridge delivers additional benefits. It allows users to access new protocols and applications on other blockchains without being confined to a single network. At the same time, it enables developers from different blockchain communities to collaborate more easily, fostering innovation across ecosystems.
In this sense, a Blockchain Bridge is not just a technical tool—it is a foundational component for the future of blockchain interoperability. As the industry moves toward a more connected and cooperative multi-chain environment, Blockchain Bridges will play a critical role in shaping how decentralized networks evolve and scale.
>>> More to read: What is Blockchain and How Does It Work?
HOW DOES A BLOCKCHAIN BRIDGE WORK?
The most common use case of a Blockchain Bridge is token transfer across different blockchains. For example, imagine you want to move your Bitcoin (BTC) onto the Ethereum network. One straightforward option would be to sell your BTC and purchase Ether (ETH). However, this approach involves transaction fees and exposes you to price volatility during the conversion process.
A Blockchain Bridge offers an alternative way to achieve the same goal—without selling your cryptocurrency. When you bridge 1 BTC to an Ethereum wallet, the Blockchain Bridge smart contract locks your BTC on its original network. At the same time, an equivalent amount of Wrapped Bitcoin (WBTC) is created on Ethereum. WBTC is an ERC-20 token designed to be fully compatible with the Ethereum ecosystem.
In this process, the original BTC remains locked inside a smart contract, while a corresponding token is issued or minted on the destination blockchain. This wrapped token represents the value of the original asset and can be used within the target network just like any other native token.
Wrapped tokens are essentially tokenized versions of another cryptocurrency. Their value is pegged to the underlying asset they represent, and in most cases, they can be redeemed—or “unwrapped”—at any time by reversing the bridging process. Through this mechanism, a Blockchain Bridge enables assets to move across blockchains while preserving ownership and value.
>>> More to read: What is Wrapped Bitcoin (WBTC)?
WHAT TYPES OF BLOCKCHAIN BRIDGES EXIST?
There are several ways to classify a Blockchain Bridge, depending on its trust model, functionality, and operational mechanism. Each category reflects different design trade-offs in security, decentralization, and usability.
✅ Custodial vs. Non-Custodial Blockchain Bridges
One of the most common classifications divides a Blockchain Bridge into two categories: custodial (centralized) and non-custodial (decentralized).
A custodial Blockchain Bridge requires users to trust a central entity to operate the bridge securely and manage locked assets properly. In this model, the bridge operator controls the system, which means users must place confidence in the organization’s operational integrity and security practices. As a result, thorough due diligence is essential before using a custodial bridge.
In contrast, a non-custodial Blockchain Bridge operates in a decentralized manner. It relies on smart contracts to manage the locking and minting of assets, removing the need to trust a centralized bridge operator. Instead of human oversight, security depends entirely on the correctness and robustness of the underlying code. In this setup, trust is shifted from institutions to software.
✅ Blockchain Bridges by Function
Another way to categorize a Blockchain Bridge is based on its primary function, such as wrapped-asset bridges and sidechain bridges.
Wrapped-asset bridges enable interoperability by tokenizing cryptocurrencies from one blockchain for use on another. A common example is converting Bitcoin into Wrapped Bitcoin (WBTC), an ERC-20 token compatible with the Ethereum network. Through this process, Bitcoin can be effectively transferred and utilized within Ethereum-based applications.
Sidechain bridges, on the other hand, connect a main blockchain to its sidechain, allowing assets and data to move between the two. This interoperability is necessary because a main chain and its sidechain often operate under different consensus mechanisms. One example is the xDai bridge, which connects the Ethereum mainnet to the Gnosis Chain (formerly the xDai blockchain). Gnosis Chain functions as an Ethereum-based stable payment sidechain secured by its own validator set, distinct from Ethereum’s validators. The xDai Blockchain Bridge enables users to transfer value smoothly between these two networks.
✅ Blockchain Bridges by Transfer Mechanism
Blockchain Bridges can also be classified by how assets move across chains: one-way or two-way bridges.
A one-way Blockchain Bridge allows users to transfer assets to a destination blockchain without the ability to move them back to the original chain. Once bridged, the assets remain permanently on the target network.
A two-way Blockchain Bridge, by contrast, supports bidirectional transfers. Assets can be bridged to another blockchain and later returned to their native chain by reversing the process. This flexibility makes two-way bridges more versatile for users who actively operate across multiple blockchains.
>>> More to read: What’s the Difference Between Blockchain and Bitcoin?
BENEFITS OF A BLOCKCHAIN BRIDGE
The most important benefit of a Blockchain Bridge is improved interoperability. By enabling assets, tokens, and data to move across different blockchains, a Blockchain Bridge connects otherwise isolated networks into a more cohesive ecosystem. This interoperability applies across Layer 1 and Layer 2 networks, as well as between various sidechains.
For example, Wrapped Bitcoin (WBTC) allows Bitcoin holders to access decentralized applications (DApps) and DeFi services within the Ethereum ecosystem. Without a Blockchain Bridge, such cross-ecosystem participation would not be possible. A highly interoperable blockchain environment is widely considered essential for the long-term success and growth of the industry.
Another key advantage of a Blockchain Bridge lies in scalability. Some bridges are designed to handle a large volume of transactions more efficiently, helping reduce congestion on major networks.
🔍 Key scalability-related benefits include:
Supporting asset transfers between high-security but congested networks and faster, lower-cost chains
Improving transaction speed and lowering fees for users
A well-known example is the Ethereum–Polygon Blockchain Bridge, a decentralized two-way bridge that serves as a scalability solution for Ethereum. By moving transactions to Polygon, users can enjoy faster confirmation times and significantly lower transaction costs while still remaining connected to the Ethereum ecosystem.
RISKS OF A BLOCKCHAIN BRIDGE
Despite their advantages, Blockchain Bridges also come with notable risks and limitations. Over time, attackers have exploited vulnerabilities in certain Blockchain Bridge smart contracts, leading to large-scale losses of cryptocurrency. In fact, cross-chain bridges have historically been among the most frequent targets for high-profile exploits.
One major risk is custodial risk. Custodial Blockchain Bridges require users to trust a centralized entity to safeguard locked assets. In theory, this central operator could misuse or steal user funds. For this reason, users should only consider custodial bridges operated by well-established platforms with a strong and transparent track record.
🔍 Additional risks and limitations include:
Smart contract vulnerabilities that can be exploited by attackers
Transaction throughput bottlenecks that limit large-scale interoperability
Dependence on the security assumptions of multiple blockchains
While a Blockchain Bridge can help relieve network congestion by moving assets to another chain, it does not fully solve scalability challenges. Users do not always migrate together with the same applications and services. For instance, some Ethereum-based DApps may not be supported on Polygon via a Blockchain Bridge, reducing the practical effectiveness of cross-chain scaling.
Finally, Blockchain Bridges can introduce trust fragmentation at the protocol level. Because a Blockchain Bridge connects two distinct blockchains, the overall security of the interconnected system is only as strong as its weakest component. If one network or bridge mechanism is compromised, the risks can propagate across the connected ecosystem.
>>> More to read: What is a Cross-chain Bridge & Why We Need It
CONCLUSION
The development of the blockchain industry has been driven by continuous innovation. Early pioneer networks such as Bitcoin and Ethereum laid the foundation, followed by the emergence of numerous alternative Layer 1 and Layer 2 blockchains. At the same time, cryptocurrencies—whether used as currencies or tokens—have grown at an exponential pace.
Because these blockchains operate under independent rules and technical architectures, Blockchain Bridges are required to connect them. By linking separate networks, a Blockchain Bridge enables a more cohesive and interoperable blockchain ecosystem, opening the door to improved scalability and greater operational efficiency.
As cross-chain attacks targeting Blockchain Bridges have occurred repeatedly, the industry continues to pursue safer and more robust Blockchain Bridge designs. Improving security while maintaining interoperability will remain a critical focus as the multi-chain ecosystem continues to evolve.
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〈What is a Blockchain Bridge?〉這篇文章最早發佈於《CoinRank》。
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Whale accumulation of Solana (SOL) has emerged as a key early-year narrative, with on-chain data showing large holders actively increasing positions and driving renewed market attention.
Bithumb disclosed that roughly $200 million in digital assets remains held across 2.6 million inactive user accounts, underscoring how much early retail capital has stayed dormant.
XRP balances on exchanges have dropped to an eight-year low, fueling supply-squeeze speculation, though historical data from CryptoQuant suggests the bullish narrative may be overstretched.
MicroStrategy recorded its first six-month losing streak since adopting its Bitcoin-focused strategy in 2020, breaking prior drawdown patterns despite continued BTC accumulation.
US crypto ETFs saw nearly $32 billion in net inflows in 2025, led by spot Bitcoin ETFs, with BlackRock’s IBIT dominating inflows and significantly outperforming peers.
Whale accumulation of Solana (SOL) has emerged as a key early-year narrative, with on-chain data showing large holders actively increasing positions and driving renewed market attention.
Bithumb disclosed that roughly $200 million in digital assets remains held across 2.6 million inactive user accounts, underscoring how much early retail capital has stayed dormant.
XRP balances on exchanges have dropped to an eight-year low, fueling supply-squeeze speculation, though historical data from CryptoQuant suggests the bullish narrative may be overstretched.
MicroStrategy recorded its first six-month losing streak since adopting its Bitcoin-focused strategy in 2020, breaking prior drawdown patterns despite continued BTC accumulation.
US crypto ETFs saw nearly $32 billion in net inflows in 2025, led by spot Bitcoin ETFs, with BlackRock’s IBIT dominating inflows and significantly outperforming peers.
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Financial giant FTI updated the holdings of its XRP spot ETF, showing a sharp increase. As of the end of December 2025, the fund holds over 118 million XRP, with a total value exceeding $215 million.
Crypto analyst Ali Martinez pointed out that Bitcoin’s 10-week and 50-week moving averages have crossed, a technical signal that has historically preceded major price corrections.
On-chain data shows that Justin Sun deposited roughly $200 million into LLP and later withdrew about $38 million. Around $33 million of the withdrawn funds was used to acquire 13.25 million LIT, representing approximately 1.33% of the token’s total supply.
An oracle contamination issue led to distorted pricing on the MetaMask market. The team stated that all affected users will receive full compensation.
According to Coinbase, multiple structural forces are expected to converge in 2026, significantly accelerating global cryptocurrency adoption.
#CoinRank #GM
Financial giant FTI updated the holdings of its XRP spot ETF, showing a sharp increase. As of the end of December 2025, the fund holds over 118 million XRP, with a total value exceeding $215 million.
Crypto analyst Ali Martinez pointed out that Bitcoin’s 10-week and 50-week moving averages have crossed, a technical signal that has historically preceded major price corrections.
On-chain data shows that Justin Sun deposited roughly $200 million into LLP and later withdrew about $38 million. Around $33 million of the withdrawn funds was used to acquire 13.25 million LIT, representing approximately 1.33% of the token’s total supply.
An oracle contamination issue led to distorted pricing on the MetaMask market. The team stated that all affected users will receive full compensation.
According to Coinbase, multiple structural forces are expected to converge in 2026, significantly accelerating global cryptocurrency adoption.
#CoinRank #GM
Tether, led by CEO @paoloardoino, purchased an additional 8,888 BTC at the end of 2025, bringing its total holdings to over 96,000 BTC. The company also boosted its gold reserves to 116 tons, making it one of the top 30 largest gold holders globally.
#Tether #Bitcoin #Gold #CoinRank
#Tether #Bitcoin #Gold #CoinRank
ETHEREUM'S $100M SACRIFICE FOR ECOSYSTEM GROWTH
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#Ethereum #ETH #L2 #CoinRank
In 2025, the Ethereum mainnet deliberately reduced transaction fees to foster the growth of its Layer 2 ecosystem. While network activity and DeFi dominance remained strong, this strategic move resulted in the mainnet forgoing over $100 million in potential revenue. This "sacrifice" allowed L2s to retain substantial profits, fueling broader ecosystem expansion, a vision often shared by VitalikButerin.
#Ethereum #ETH #L2 #CoinRank
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