Bahrain’s Rain Crypto Exchange Hit by $14.8M Exploit, Funds Diverted to BTC and ETH
In 2023, Rain obtained a license to operate as a virtual asset brokerage and custody service provider in the United Arab Emirates.
Crypto vs Traditional Savings Account: Which One Should You Use?
Crypto vs Traditional Savings Account, Which One Should You Use? The age-old question of where to park your savings persists in the digital age. Traditional savings accounts have long been a trusted companion, offering safety and predictability. But with the rise of cryptocurrencies, a new option has emerged, tempting some with the allure of potentially higher returns. However, cryptocurrency is very different from the usual area of banking. This comprehensive guide will equip you with the knowledge to learn which option aligns best with your financial objectives. Key Takeaway A Brief History of Traditional Savings Account The concept of saving money for future needs dates back millennia, but the formal structure of the traditional savings account as we know it today has a surprisingly recent origin. The seeds of this system were sown in the 18th century with the rise of montes pietatis, charitable lending institutions in Europe. These institutions accepted deposits from the poor and offered small loans at low-interest rates. A major turning point came in the 19th century with the establishment of savings banks. These institutions, initially focused on philanthropy, aimed to encourage saving habits among the working class. Early savings banks often had strict rules, limiting deposit amounts and requiring withdrawal notice. Pioneering institutions like the Savings Bank of Scotland, founded in 1810, offered a safe haven for people’s hard-earned money and instilled a culture of saving. The concept spread rapidly across Europe and North America. In the United States, the Postal Savings System was established in 1910, providing a government-backed option for Americans, particularly those in rural areas. These early savings accounts offered modest interest rates, but the primary benefit was security and accessibility compared to keeping cash at home. The 20th century saw significant advancements in savings accounts. Technological innovations like ATMs and online banking made depositing and withdrawing funds easier and faster. Deregulation in the financial sector in the latter part of the century led to increased competition among banks, with some offering higher interest rates to attract customers. This period also saw the introduction of features like money market deposit accounts (MMDAs) that offered slightly higher returns but with limited withdrawal flexibility. Despite facing competition from new investment vehicles, traditional savings accounts remain a vital part of finance. They provide a safe and liquid place to store emergency funds, save for short-term goals, and earn a modest return. While interest rates have declined in recent years, the convenience and security of savings accounts continue to make them a popular choice for people of all income levels. How Traditional Savings Account Work Traditional savings accounts offer a safe and accessible way to store your money. Banks and credit unions pool these deposits, using them to fund loans for other customers. In exchange for allowing your money to be used in this way, you earn interest on your balance. Depositing and Withdrawing Funds Adding and removing money from your savings account is typically a straightforward process. Deposits can be made via online transfers, ATM deposits, or in person at a branch. Withdrawals can be done similarly, with some limitations. Federal regulations in the United States, for example, restrict the number of withdrawals from a savings account to six per month, although the limit was removed in April 2020, to provide consumers with increased access to funds they might need to navigate the economic fallout from the coronavirus pandemic. Earning Interest Savings accounts accrue interest on your balance over time. This interest is typically calculated and compounded monthly, meaning you earn interest on your interest. The interest rate is expressed as an Annual Percentage Yield (APY). This figure reflects the total amount of interest you will earn in a year, assuming the interest rate remains constant. However, it’s important to note that APYs can fluctuate depending on market conditions and the bank’s policies. Advantages of Traditional Savings Account Traditional savings accounts offer a multitude of benefits that make them a cornerstone of any healthy financial plan. Here are some of the key advantages they provide: Safety and Security One of the most significant advantages of traditional savings accounts is the safety and security they offer your money. In the United States, deposits in traditional savings accounts are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per depositor, per insured bank. This means that even if the bank were to fail, your money would be safe. Similar government protection programs exist in many other countries. Liquidity and Easy Access Unlike some investment options with restrictions on withdrawals, you can typically withdraw money from your savings account whenever you need it, subject to federal regulations. In the US, for example, regulations limit withdrawals to six per month. Multiple Access Points Deposits and withdrawals can be made conveniently through various methods like online transfers, ATM deposits, or in person at a branch. This flexibility ensures you can access your money when and where you need it. Predictable and Stable Returns While not offering the high potential returns of some investments, traditional savings accounts provide predictable and stable growth for your money. Guaranteed Interest Savings accounts earn interest on your deposited funds. This interest rate, though typically lower than investment options, is guaranteed by the bank. Compounding Interest The interest earned on your savings account is often compounded, meaning you earn interest on both your initial deposit and the accumulated interest over time. This can help your savings grow steadily over the long term. Disadvantages of Traditional Savings Account While traditional savings accounts offer a safe and accessible way to store your money, they also come with certain limitations. Here are some of the potential drawbacks: A Brief History of Crypto Savings Account (Crypto Staking) Traditional savings accounts have a long and established history, but crypto savings accounts, also known as crypto staking, are a relatively new phenomenon within the rapidly evolving world of cryptocurrency. Their origins can be traced back to the emergence of Proof-of-Stake (PoS) blockchains, a significant innovation in blockchain technology. Bitcoin,
Top 10 DeFi Protocols You Need to Know About in 2024
in this detailed guy, we will be looking at top 10 defi protocols you need to be conversant with in 2024, Let’s get started DeFi, or Decentralized Finance, consists of financial applications and services that use blockchain technology. Picture a global financial network that’s always open, where you can borrow, lend, trade, and manage your assets without the need for banks. DeFi uses smart contracts, which are automated agreements that execute transactions when certain conditions are met. This removes the need for central authorities, creating a more secure and transparent financial system. While DeFi is still new, its potential to change the current financial system is clear. This blog post will guide you through this exciting new area. We will look at the top 10 DeFi protocols of 2024, giving you the information you need to explore this innovative financial space and discover many new opportunities. Key Takeaways What are Decentralized Exchanges (DEXs) Decentralized exchanges (DEXs) are key to DeFi trading, letting users exchange cryptocurrencies directly without central institutions. Unlike traditional exchanges, DEXs use smart contracts to automatically match and execute orders, providing a secure and transparent trading experience. We will now look at some of the top DEXs in 2024: Top 10 DeFi Protocols You Need to Know About in 2024 1. Uniswap (UNI) Image Source: Uniswap Uniswap is a leader in DeFi trading with its Automated Market Maker (AMM) model, which has transformed how trading is done. Instead of using traditional order books, AMM uses liquidity pools where users contribute crypto assets. Prices are set automatically by the smart contract, based on the pool’s supply and demand. Uniswap is known for its substantial liquidity, attracting a large user base and ensuring smooth trading. Additionally, Uniswap places a strong emphasis on its community, actively seeking feedback to guide its development. 2. Curve Finance (CRV) Image Source: Curve Curve Finance is designed for those who want to swap stablecoins efficiently with minimal slippage, making it ideal for traders and arbitrageurs. Unlike Uniswap, Curve uses a specialized algorithm tailored for stablecoin trading that reduces price fluctuations. This ensures that users get the best exchange rates when trading pegged assets like USDC and DAI. With its focus on stablecoin liquidity, Curve is a crucial tool for managing crypto portfolios and protecting against market volatility. 3. SushiSwap (SUSHI) Image Source: SushiSwap SushiSwap is a well-known decentralized exchange that offers a mix of basic trading functions and extra features. It builds on the Automated Market Maker model, allowing users to trade a wide variety of cryptocurrencies. Beyond just trading, SushiSwap includes options like yield farming, where users can stake their cryptocurrencies to earn rewards. It also provides on-chain analytics to give users valuable information about the depth of liquidity pools and trading activities. DEX Aggregators While each decentralized exchange (DEX) has its benefits, searching multiple platforms for the best prices can be challenging. DEX aggregators like 1inch simplify this process. 1inch works like a search engine for DEXs, scanning different platforms to find the best exchange rates for trades. It then directs the trade through the most efficient DEX, ensuring users receive the best possible deal. Tools like 1inch are valuable for DeFi traders who want to optimize their transactions and maximize returns. Understanding these leading DEXs and the function of DEX aggregators equips you to be a savvy DeFi trader. Remember, DEXs allow you to manage your crypto assets independently and trade on your own terms, leading to a more open and accessible financial future. Lending/Borrowing Protocols Lending and borrowing protocols are crucial to DeFi, allowing users to use their crypto holdings in new ways. These protocols set up a peer-to-peer lending marketplace where users can deposit their crypto assets to earn interest or borrow money for different needs. Let’s look at some of the top lending and borrowing protocols in 2024: 4. Aave (AAVE) Image Source: Aave Aave has become a leading player in DeFi lending, providing a wide array of borrowing and lending options. Users can deposit various crypto assets into liquidity pools to earn attractive interest rates. Aave also offers competitive rates for borrowers needing crypto loans. One distinctive feature of Aave is its support for flash loans—quick, unsecured loans that must be repaid in the same transaction block. Flash loans open up many creative possibilities for developers and advanced users in the DeFi space. 5. Compound Finance (COMP) Image Source: Compound Finance Compound Finance is known for its easy-to-use interface and simple approach to crypto lending. Users can quickly deposit their crypto assets on Compound and start earning interest immediately. The platform also allows users to borrow against their deposited crypto for various purposes. With its emphasis on simplicity, Compound is an excellent option for beginners in DeFi looking for an easy way to earn interest on their crypto assets. 6. MakerDAO (MKR) Image Source: MakerDAO MakerDAO is notable for issuing DAI, a well-known decentralized stablecoin. Unlike typical stablecoins tied to traditional currencies, DAI maintains its stability through a system where users lock up crypto assets as collateral to create DAI, acting like a decentralized loan. MakerDAO also has a strong governance system, using its MKR token to let holders vote on important decisions about the protocol. Asset-Specific Lending Protocols The DeFi lending sector is continuously developing, with new protocols emerging that focus on specific types of assets. An exciting trend is the growth of lending protocols that handle real-world assets (RWAs), like real estate or invoices. These protocols connect traditional finance with DeFi, allowing users to use real-world assets in DeFi applications. Although these RWA lending protocols are still developing, they have great potential to expand DeFi’s reach. Liquid Staking Protocols Ethereum’s switch to Proof-of-Stake (PoS) has led to the development of liquid staking protocols in DeFi. Unlike traditional staking, where assets are locked up for long periods, liquid staking lets users earn rewards from staking their crypto while keeping their assets liquid. This section will discuss the significance of liquid staking and examine two leading protocols:
10 Largest Crypto Exchange Hacks You Should Know
In this detailed guide, we have provided you with 10 largest crypto exchange hacks you should knowin 2024. Imagine waking up one morning to discover your entire digital bank account has vanished. No, it’s not a nightmare. In cryptocurrency, this is a very real threat. Crypto exchanges, where people buy and sell digital currencies, have become a prime target for hackers, with billions of dollars stolen over the years. In fact, a recent study found that about $3.8 billion worth of cryptocurrency was stolen from exchanges in 2022 alone! This article dives deep into the top 10 biggest crypto exchange hacks, explaining how they happened, the impact they had, and most importantly, how you can protect yourself from becoming a victim. Key Takeaways What Is Crypto Exchange Hack? Freepik A crypto exchange hack involves unauthorized access to a platform where digital assets are bought, sold, or traded. Hackers aim to steal cryptocurrencies stored within these platforms, capitalizing on security weaknesses. To understand why these breaches occur, it’s essential to know how crypto exchanges operate and why they become targets. How Crypto Exchanges Work Crypto exchanges function as intermediaries for trading cryptocurrencies, similar to how stock exchanges facilitate trading of stocks. Users can deposit funds, place trades, and withdraw earnings. However, unlike traditional banking systems, many exchanges store significant amounts of cryptocurrency in digital wallets, which can be hot (connected to the internet) or cold (offline storage). Why Are Crypto Exchanges Targeted by Hackers? Common Vulnerabilities Hackers exploit a variety of vulnerabilities to breach crypto exchanges, including: By understanding these foundational elements, we can better appreciate the scale and variety of the hacks discussed in the following section. Top 10 Largest Crypto Exchange Hacks istockphoto 1. Ronin Network Date of the Hack: March 29, 2022 Amount Stolen: Approximately $625 million worth of cryptocurrency Cryptocurrencies Stolen: Mainly Ethereum (ETH) and USD Coin (USDC) How the Hack Occurred: The Ronin Network, which supports the popular blockchain game Axie Infinity, fell victim to one of the largest cryptocurrency thefts in history. Hackers were able to compromise the network by exploiting weaknesses in its validation processes. Specifically, they gained control over the majority of the network’s validator nodes. Ronin Network utilizes a system where only nine validator nodes confirm transactions. The attackers managed to breach five of these nodes—four controlled directly by Sky Mavis (the company behind Axie Infinity) and one by a third-party provider. This control allowed them to forge fake withdrawals. Impact on the Exchange and Its Users: The hack damaged trust in decentralized platforms. Ronin Network and Sky Mavis increased validator nodes to improve security. They collaborated with authorities to trace stolen funds and explore recovery options. Reimbursement plans were announced to compensate users, funded by new capital and a reimbursement fund. Related: Top 5 Secure Crypto Wallets to Safeguard Your Digital Assets 2. Poly Network Date of the Hack: August 10, 2021 Amount Stolen: Approximately $610 million worth of cryptocurrency Cryptocurrencies Stolen: Various, including Ethereum, Binance Smart Chain, and Polygon. How the Hack Occurred: The Poly Network hack exploited vulnerabilities in Poly’s smart contracts, the self-executing code that governs transactions on the platform. Hackers manipulated a function within these contracts, essentially creating a loophole that allowed them to transfer a massive amount of cryptocurrency out of the network. Impact on the Exchange and Its Users: This audacious hack sent shockwaves through the crypto industry. However, in a surprising turn of events, the hacker returned all the stolen funds over a two-week period. Poly Network credited the hacker’s cooperation with minimizing user losses and fostering a dialogue about security improvements. This incident highlighted the potential vulnerabilities of smart contracts and the importance of robust security audits. 3. Binance BNB Bridge Date of the Hack: October 6, 2022 Amount Stolen: Approximately $570 million worth of cryptocurrency Cryptocurrencies Stolen: Binance Coin (BNB) How the Hack Occurred: The Binance BNB Bridge, which facilitates the transfer of assets between different blockchains, was hacked due to a vulnerability exploited by an attacker. The hacker managed to create additional BNB tokens by exploiting a flaw in the bridge’s smart contract, which allowed them to bypass standard security checks and inflate the supply without proper authorization. Impact on the Exchange and Its Users: The hack severely damaged trust in Binance, leading to a significant drop in BNB’s price. Binance managed to freeze $7 million in funds after pushing an update that froze the hackers’ accounts. The Binance team introduced a new on-chain governance mechanism to combat future attacks. 4. FTX Date of the Hack: November 11, 2022 Amount Stolen: Approximately $415 million worth of cryptocurrency Cryptocurrencies Stolen: Various types, including Ethereum (ETH) and USD Coin (USDC) How the Hack Occurred: FTX, a major crypto exchange, fell victim to a significant security breach. The hackers managed to compromise the system and transferred out hundreds of millions of dollars worth of crypto. The theft was uncovered shortly after the company filed for bankruptcy. Impact on the Exchange and Its Users: The hack severely damaged trust in FTX, leading to a wave of withdrawals that crippled the exchange. In response, FTX collaborated with global regulators and law enforcement to trace the stolen funds. Despite the significant loss, FTX managed to recover about $5.5 billion in assets. 5. Coincheck Date of the Hack: January 26, 2018 Amount Stolen: Approximately $534 million worth of cryptocurrency Cryptocurrencies Stolen: Predominantly NEM (XEM) How the Hack Occurred: Coincheck, a leading Japanese digital currency exchange, was targeted by unidentified hackers. They exploited vulnerabilities in the exchange’s security system, gaining unauthorized access to a majority of the network’s validator nodes. This breach allowed them to fabricate fraudulent withdrawals and transfer an estimated $534 million worth of NEM coins to their wallets. Impact on the Exchange and Its Users: The hack had a profound impact on Coincheck, triggering a massive wave of withdrawals that destabilized the exchange. In response to the crisis, Coincheck collaborated with law enforcement agencies to trace the stolen funds. Despite the substantial loss, Coincheck was
