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The crypto market teaches lessons every day and it’s up to investors to accept it or turn a blind eye. Terra LUNA thought investors several lessons that will be remembered for a long time ahead. TerraUST and LUNA fell dramatically as both went straight to $0 falling 100% in three days. While its UST got depegged 1:1 from the USD, LUNA fell from $100 to $0. Investors are still picking up the rubbles from the crash and are digesting the reality of what just happened.The TerraUST and LUNA crash taught crypto investors lessons of a lifetime. Below are 2 important lessons that investors learned from the disaster.1. Focus on Value, Not Hype and Blind LoyaltyThe crypto market is full of hype and blind loyalty by investors who swear by their favorite token come hell or high water. There is no dearth of tokens that are currently sustained just by hype and loyalty.The TerraUST and LUNA crash taught investors that being a LUNAtic might not help in terms of finances. Moreover, blind loyalty and hype can only take a token this far, and when it fizzles out, it’s a slippery slope.Don’t give in to hype as publicity lasts for a few months and the real test might make it crash. The wise thing to do is to research all underlying values of the token and invest with no ‘strings attached’. Profit-making should be the only goal and not blind loyalty. Sadly, blind loyalty can only make the Devs rich and not vice-versa for the investors.2. Terra LUNA Crash: Crypto ‘Decentralization’ MythThe Terra LUNA crash taught investors that not all that glitters is gold… ahem ahem ‘not all that is decentralized is decentralized’. The phrase that the crypto market is ‘decentralized’ turned out to be a myth after Terra LUNA crashed to $0. The market seems to be controlled by operators than meet the eye of an average investor.Do Kwon and the team deployed their $1.5 billion Bitcoin reserve to save their UST from crashing to $0. The decision to do so was taken after six members of the Luna Foundation Guard (LFG) agreed to his ideas. The team then stayed silent without answering questions from investors for six days straight. Also, the deployment of BTC was done on May 9, and on May 16, they explained that all their reserves including 80,000 BTC, is sold.Kwon, who repeatedly claimed that the crypto market is decentralized, retweeted a post that says LGF is a centralized system. In conclusion, Do Kwon was merely spreading a myth that the market is decentralized while he knew there’s a centralized system in place. However, the centralized system is not shown to the average investor.#LUNC #BinanceTournament

Key Takeaways

The blockchain trilemma highlights the difficulty that blockchain networks face when trying to balance security, decentralization, and scalability. 

There are multiple scaling solutions being explored to address such limitations. Some are focused on the main chain (Layer 1) while others focus on a separate chain (Layer 2).

Layer 1 scaling solutions refer to changes to the main blockchain architecture and rules to improve its performance (e.g., changing how consensus works or using sharding).

Layer 2 solutions are made of secondary frameworks built on top of a Layer 1 to help alleviate its workload (e.g., by handling transaction processing off the main chain).

The future of blockchain will likely rely on a mix of both systems, using Layer 1 for security and settlement while relying on Layer 2 for higher speeds and lower costs.

Introduction

The popularity of cryptocurrency continues to grow, bringing an influx of new users and transactions. While the revolutionary nature of blockchain is clear, scalability (a system’s capacity to handle increasing demand) remains a primary challenge. Public blockchains that prioritize decentralization and security often struggle to achieve high throughput.

This challenge is known as the blockchain trilemma, which states that it is difficult for a decentralized system to simultaneously achieve high levels of decentralization, security, and scalability. Typically, networks prioritize two at the expense of the third.

To solve this, developers have created different scaling approaches. Some solutions tweak the architecture of the main blockchain (Layer 1), while others operate on secondary protocols that run on top of the underlying network (Layer 2).

Layer 1 vs. Layer 2

The term Layer 1 refers to the foundational level of a blockchain architecture. It is the main network where transactions are finalized. Examples include Bitcoin, Ethereum, BNB Chain, and Solana.

Layer 2 refers to networks or protocols built on top of these Layer 1 blockchains. For example, the Lightning Network is a Layer 2 solution for Bitcoin, and Arbitrum is a Layer 2 for Ethereum.

Scaling improvements are categorized based on where they occur:

A Layer 1 solution changes the rules or mechanisms of the base blockchain directly (e.g., changing the consensus mechanism).

A Layer 2 solution uses an external, parallel network to facilitate transactions away from the main chain to reduce congestion.

Common Layer 1 Scaling Solutions

1. Consensus mechanism

Some blockchains are switching from slow, energy-heavy systems like Proof of Work (PoW) to more efficient ones like Proof of Stake (PoS). For instance, Ethereum moved to PoS to improve its ability to process data and be more eco-friendly. This method uses staking (locking up coins) instead of mining to verify transactions.

2. Sharding

Sharding is like breaking a large database into smaller, easier-to-manage pieces called "shards". So, instead of having every computer on the network doing all the work, the work is split up. This allows the blockchain to process multiple transactions at the same time, increasing overall efficiency.

3. Block size increases

Some blockchains simply increase the size of the blocks. This lets more transactions fit into a single block. However, this can make it harder for regular computers to run as validating nodes in the network, which might hurt decentralization.

Common Layer 2 Scaling Solutions

1. Rollups

Rollups are currently the most popular scaling solution for Ethereum. They "roll up" (bundle) hundreds of off-chain transactions into a single batch before submitting them to the main chain.

Optimistic rollups: Used by networks like Optimism and Arbitrum, these assume transactions are valid by default. They offer a "fraud-proof" period where invalid transactions can be challenged.

Zero-knowledge (ZK) rollups: Used by networks like zkSync and Scroll, ZK rollups use cryptographic proofs to verify the validity of transactions instantly. They offer high security and privacy without the need for a dispute period.

2. Sidechains

Sidechains are independent blockchains with their own sets of validators. A prime example is the Polygon PoS network. Unlike rollups, sidechains are responsible for their own security. While they are often faster and cheaper, they do not directly inherit the security of the main Layer 1 chain in the same way rollups do.

3. State channels

A state channel is a two-way communication environment between participants. Users transact off-chain as many times as they like, and only the opening and closing balances are recorded on the blockchain. The Bitcoin Lightning Network operates on this model, allowing for instant, low-fee Bitcoin payments.

4. Nested blockchains

In this setup, the main blockchain gives work to "child" chains. The child chains do the work and send the results back to the "parent" chain. The Plasma framework on Ethereum is an example of this.

Layer 1 vs. Layer 2: Key Differences

Both layers want to make the network faster, but they do it differently.

Feature

Layer 1

Layer 2

Purpose

Operates as the base source of truth and settlement layer.

Designed to increase throughput and reduce fees for the base layer.

Method

Changes the protocol rules (e.g., sharding, consensus).

Offloads processing to an auxiliary network or application.

Security

Relies on its own decentralized consensus mechanism.

Typically relies on the main chain for security and data availability.

Complexity

Upgrades can be difficult and require network-wide consensus (forks).

Can be implemented and upgraded more flexibly without disrupting the main chain.

Limitations of Scaling Solutions

Layer 1: Upgrading the main chain is difficult. Major changes, such as increasing block size or changing consensus, often require a hard fork, which can split the community.

Layer 2: While fast, L2s can add complexity. Users have to bridge funds between networks, and liquidity can become fragmented across different L2s. Additionally, some L2s rely on centralized sequencers, which introduces a potential point of failure compared to the decentralized main chain.

Closing Thoughts

The blockchain world is growing fast. To handle mass adoption, we need networks that are both secure and fast. Layer 1 upgrades like sharding are important for the long term. However, Layer 2 solutions offer the speed and low costs we need right now. Going forward, it will likely be more common to see a mix of both: a strong Layer 1 for security and flexible Layer 2 networks for everyday transactions.

Further Reading

What Is the Blockchain Trilemma? 

What Are Zk-Rollups? The Layer-2 Scalability Technique 

What Are Bitcoin Layer 2 Networks? 

What Is Sharding and How Does It Work? 

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The price of bitcoin has gone up by over $200 since the leak of the highly anticipated Grand Theft Auto VI (GTA VI) trailer unexpectedly served as an advertisement for the cryptocurrency, by featuring a prominent watermark that read “Buy $BTC.”
A low-quality version of the video was published on Monday afternoon. In response to the leak, GTA VI creators Rockstar Games decided to quickly publish the high-quality version of the trailer — a week ahead of schedule. “Our trailer has leaked so please watch the real thing on YouTube,” Rockstar shared on X.
Some crypto enthusiasts called the leaker “an absolute king” because he “shilled our bags.” Right after the leak, bitcoin’s price spiked by $700 (1.2%), from $41,700 to $42,400 before cooling back down to $41,940 at press time.

The leaked version of the GTA VI trailer has since been deleted.
Bitcoin’s free advertising didn’t last long, however. The account, @gta6trailerleak, was soon taken down. Some users have been keen to keep the video circulating on the leaker’s behalf.
Bitcoin has been on a steady pump this past week, up 12.7% from $37,400 to $41,900 at press time. It marks a 150-day all-time-high.

Bitcoin notably pumped on Monday evening (EU time) but has only stayed up $200.

Bitcoin has surged this week.
The GTA VI trailer notably didn’t include a release date, nor did it mention which consoles it would be released on. The video game, which has reportedly cost over $1 billion to make so far, will be released in 2025 on Xbox Series S/X and Playstation 5. Plans for a PC version have not been announced.
$BTC #BTC #GTA6trailer

💥2024 NOTCOIN (NOT) The Beginning Of Bullishness 🐂💥Please invest safely⚠️. Many people find it difficult when it comes to deciding where to start investing in cryptos. Before we know the right place to start crypto investments, it is important to understand what Cryptos mean.

Cryptos are a Peer-to-Peer (P2P) electronic cash system without an involved third party. What does this mean? It means that Crypto is a decentralised system that does not require an intermediary to authorise its financial transactions but instead uses a decentralised system known as blockchain technology secured by Cryptography.

What is Blockchain?
A simple example of blockchain is like a paved road and cryptos are like a car. For a car to pass, it requires the presence of a paved road so it can pass more easily. Therefore, blockchain is the place where most crypto transactions take place.
Blockchain like a paved roadCrypto like a Car
Why are Cryptos present nowadays?
This question can be answered as follows:
Cryptos exist due to the evolution of money, which is very difficult to avoid based on the advancements in science and technology that humans have been making every day with the aim of making the world a comfortable place to live in. This evolution of money aims at correcting the mistakes at every stage of the evolution of money.

Refering the image: From Barter Trade to cryptocurrencies, we call it cryptos, it is already considered the evolution of money. People using Barter Trade faced significant challenges in exchanging goods for goods, which led them to find another way to simplify life by introducing a form of Gold, metal coins, which later, based on their weight to carry, were converted into paper money. Later, due to their vulnerability to burning easily, plastic cards were introduced, and then electronic money. With electronic money, there is a problem of Government Controlled Programmable money, which posed difficulties when sending money quickly abroad as it took a long time to reach the recipient and sometimes incurred high costs when sending money abroad.

Through the evolution of money mentioned above, the evolution of money in cryptos is born, which does not require an intermediary to authorise transactions between two people when exchanging money but rather a decentralised system, namely Peer To Peer Electronic Cash System. This is a significant and unique step in the evolution of money that allows individuals to have control over their finances without being under any authority that currently controls everything related to people's money.

Benefits of the New Money Paymemt System:
Equality for All:
It is a system where the rich person in America and the farmer in Chitoholi Mtwara or in Konde Boy village or in Kigoma with Diamond, all have an equal opportunity to benefit from this new system. This is possible due to the wave of smartphones and the widespread availability of the internet in almost every corner of the world. Fortunately, in Tanzania, we are moving towards having high-speed internet called Starlink (a satellite-based system) under the world's richest man Elon Musk, who is also a big believer in Bitcoin and other cryptocurrencies.
Ease of sending money at low cost.
In the current paper/Electronic money system, it is expensive to send money between countries. When there is ease in sending money between countries, it makes business operations easier, thus bringing development and boosting the economy in line with globalization.
According to information from the Sustainable Development Goals (SDGs), there have been high costs associated with facilitating the transfer of money between countries using the current money system. Where the cost of sending money is seven percent (7%) compared to the target of three percent (3%). And the costs are even higher, reaching 8.97% when it comes to African countries.
This new technology of Cryptos and digital money system or cryptocurrencies simplifies sending money at a low cost below 3% or even zero fees, and most importantly, the money arrives on time.
More Privacy and Security:
Your money in the digital system remains confidential. No one can know how much you own, except for yourself. The system recognizes that a certain person has a certain amount of money (Cryptos) but their name is unknown. Also, money in this system is completely secure. The only task for the person who owns this money is to keep their password secret.
Easy to Use:
You don't need to carry your money in a bag or wallet, just having it on your phone is enough, and you can pay for services or goods anywhere in the world more easily. An example is Binance Pay, which allows you to order goods from China or Dubai while at home in Tanzania/India as long as your device supports internet. The only task is to keep your password secret. You won't need to exchange Tanzanian Shillings for Japanese Yen to pay for your car from Japan. Having cryptos is enough to be used anywhere in the world.
Investing in Projects Worldwide:
The advent of digital money has enabled people to do business and invest anywhere in the world. Previously, it was not easy to own shares of U.S. companies like Google or Facebook while in South Africa. With this new system, there has been an increase in good ways to use cryptos to buy shares of companies in major countries worldwide. Stock trading used to require people with high income and great understanding, but with the arrival of the internet and easy access to information, people can participate in markets that were difficult to reach and reap profits. For example, the Abra app opens the door for anyone worldwide through its platform to buy and own shares of major companies, digital money, and ETFs.
Protection Against Inflation:

We witnessed last years in 2022 and 2023 many people complaining about the rising prices of goods, and it is possible that inflation of goods will continue to rise even more until this year 2024 (but if you start using cryptocurrencies, you will already have overcome inflation and your life will be much easier). Inflation is when the value of a currency decreases, and prices of goods increase. This situation leads to a difficult life. With the arrival of this new technology, it is safer because digital money tends to increase in value. For example, currently, Bitcoin on Binance exchange is selling at a price of $69,000. Imagine if you acquired some Bitcoin at a low price because you don't need to buy a whole item, even in decimals, Bitcoin shows the value of the money you have, even $10 is fine, then if that Bitcoin reaches a price of $200,000 by the year 2025, and you could potentially make over $30. This is the hidden secret that many people do not know.

Remember that since Bitcoin started in 2009, it has been priced at $0.009 at one point through this small calculation but with a significant impact on investment in Bitcoin when using Binance. It has become a shield against devaluation and brings profit. That's why it's not surprising to realize that the year Bitcoin was born in 2008 was a year of significant economic turmoil. There was a significant inflation of prices and a devaluation of the dollar. This year 2024, many countries are preparing to use cryptos and Binance exchange properly. Examples include Nigeria, South Africa, Kenya, Uganda. Other countries are Germany through their car manufacturing company BMW; other countries are France, Italy, El Salvador, and the United States, which have now approved Bitcoin and Ethereum ETFs, which is a good and unique step in crypto investment especially when these major countries are trying to go public and agree with the evolution of money especially the use of cryptos.
The fundamental question arises: where should you start investing using Cryptos? The answer is Binance 😊😋🥳
Why Binance?

1. Binance is the right place or reliable crypto Exchange for you to buy Cryptocurrencies at low prices and wait for the market value to rise so you can sell your Cryptos and make a profit.

2. The right place to order your goods from abroad more easily using Binance Pay.

3. Binance is a secure place for selling your artworks such as paintings, music, and sports performances. A real-life example is Cristiano Ronaldo who is on Binance selling his football performances and earning money smoothly through Binance.
These artworks in the language of Blockchain technology are called Non Fungible Tokens (NFT).

4. Additionally, BINANCE is a safe place where you can purchase airtime for your phone through Binance, and even buy a bundle easily through Binance to your phone.
5. Binance also has a suitable platform for you to advertise your business globally using something called Binance Square.

It is a place where your advertisement can be viewed by over 1 million people per week, including individuals with significant intelligence and financial resources who may help you establish good connections for a better life!
6. Binance is a Crypto leader by volume, currently having more than 196M+ users as of today, June 3, 2024. This is a large number among the 600M+ crypto users, which is approximately 5%+!
Binance Crypto Lead by Volume Binance Users Worldwide

Start your crypto journey with Binance using the following Binance Account Registration Form
Also use the link to understand Binance's web 3 wallet to store your cryptos securely.
Last you are free to buy NOTCOIN (NOT) $NOT the project that you don’t need to miss out without forgetting $BNB and $ETH
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Always do your own research before investing in crypto space I wish you a nice day!😊🤗
#StartInvestingInCrypto