BC CRYPTO
Saved by @Shubham51ngh

If you've been following DeFi or Ethereum over the past few months, you've likely heard the term "flash loan" mentioned again and again.

This new DeFi primitive has been at the core of a number of economic exploits and arbitrages.

A thread on the basics of flash loans - 👇

 Most DeFi loans take place across days, weeks, or even months.

You can deposit Ethereum into Aave, then withdraw stablecoins for yield farming in Yearn, for instance.

On-chain loans have garnered much traction, with total debt outstanding moving toward $2.5 billion.
While popular, DeFi loans are not capital efficient: to account for custodial risk and volatility risk, you need to put up 130-150% of the value of your loan in collateral.

If your collateral slips below the threshold, you're liquidated, resulting in a fee anywhere from 5-13%.
Flash loans are much different than longer-term DeFi loans.

Flash loans are non-custodial, take place over the course of one block, and require no collateralization.

That's to say, the coins you borrow never appear in your wallet.
When taking a flash loan, you can direct the coins to any protocol and function, as long as you pay back the loan + interest fee within the same transaction.

So what the hell? What are flash loans used for?

More often than not, arbitrage.
This means that if you spot mispriced markets between AMMs or dexs, you can take a flash loan to arbitrage the pools.

Here's a simple example I spotted in the mempool a few months back:

https://t.co/hiBHuTerQH

More on what's happening in the next tweet.
- This user flash borrowed 2,048,000 USDC from dYdX

- Traded that USDC for 2,028,367 DAI in Curve's Y pool

- Traded that DAI for 2,064,182 USDC in Curve's sUSD pool

- Paid dYdX back + 2 wei

All in one block...

Profit: 16,182 USDC
Cost: $60 in gas

Crazy, right?
The transaction I mentioned is just one of many simple arbitrages between different AMMs and diff pools. (More on AMMs in the linked thread.)

There are also advanced arb strategies that enabled the "attacks" on Eminence, Harvest, etc.

Let's take a look.

https://t.co/wftj1YuPtG
Many of these arbs are not AMM based. Instead, these arbs are accomplished by leveraging some faulty or buggy logic in the economic design of a protocol.
Eminence:

- Borrow 15 million DAI from Uniswap
- Mint EMN
- Burn some EMN for eToken, driving up EMN up the curve
- Sell remaining EMN for DAI
- Make millions

The bug was the bonding curve was steep and could be manipulated.

https://t.co/fP3ae4oDXQ
Harvest:

The bug was that Harvest didn't use the get_virtual_price() function from Curve, allowing for manipulation.
Flash loans can also be used for other purposes.

Governance attacks are a good example. They're scary but still kind of sick, to be honest.

On October 26th, a user used flash loans to influence a MakerDAO proposal.

https://t.co/naqLqOi1bS
This user completed multiple complex functions with a single tx, within a single block.

They

- borrowed $20m worth of WETH from dYdX
- deposited it on Aave to borrow $7m worth of MKR
- Locked MKR in governance
- Voted on a proposal
- Unlocked MKR
- Sent MKR, then ETH back
Related to flash loans, developers are working on flash mints for Wrapped Ethereum and DAI. Will do another thread on these later.

Flash loans will be similar in concept to flash mints but will involve the minting, then burning of tokens rapidly to accomplish some feat.
To conclude: Flash loans are an extremely powerful DeFi primitive.

I forgot who said it but they're going to accelerate the wheat from the chaff when it comes to protocols with good economic design.

I'm excited (and scared) to see what flash loans are used for next.

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Some thoughts on this super inaccurate piece.

tl;dr: this is not a defence of Tether/ iFinex, who I would like nothing more than to see disappear into irrelevance. However, most of the conclusions here show zero understanding of crypto market

1. First up: it’s completely inexcusable that Tether refuse to have a 3rd party audit. I can’t find a single good faith reason for this.

Bitfinex GC recently did a superb job of sidestepping that question on WBD:

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"The End of Poverty, The End of Debt, The Beginning of a New Golden Age!"

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N = National (US)
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Daan Crypto Trades #NFT
Daan Crypto Trades #NF...
@DaanCrypto
NFT Crypto Guide 101 📚

🔹What are Non-Fungible-Tokens?
🔹What are NFTs used for?
🔹What do I expect for the NFT space in 2021?
🔹What NFTs do i hold?
🔹Where do I buy NFTs?

I will go through all of these questions.

Thread below 👇

🔹What are Non-Fungible-Tokens (NFTs)?

NFTs are crypto tokens that represent something unique. They are not mutually interchangeable.

This means that one NFT is not the same as the other.

Unlike for example Bitcoin, where each satoshi is exactly the same as the other.

These NFTs exist on the Ethereum Blockchain. Instead of ERC-20 tokens, we call these NFTs: ERC-721 or ERC-1155 tokens.


Each of these NFTs have an unique ID that seperates them.

For example, The Hashmask with ID #6718 is completely different than the Hashmask with ID #9939.

Different visually as well as the ID on the blockchain.


🔹What are NFTs used for?

NFTs are used to create verifiable digital scarcity and digital ownership.

The main applications we see today are:

🔹Digital Art
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@cryptunez
TRIANGLE MASTERCLASS - a thread.

what's the simplest, most effective method of trading a market that trends as hard as cryptocurrencies?

trendlines.

one trendline on its own is strong, but when you put two together you quickly realize just how powerful this simple tool can be.


i've been using triangles for as long as i can remember.

it seems dumb, and almost counter-intuitive to approach such a complex game like trading with such a simple approach like shapes...but maybe when markets start acting stupid its okay to dumb down our approach.

look, not all triangles are the same.

anybody can draw some lines on a chart any way they'd like. sometimes, we let our bias affect our charts rather than the other way around.

i personally have done this more times than i can count.

you see...triangles (and analysis as a whole) is not necessarily intended to make trading easier as much as it is to make trading simple.

you want a fluid bias that can change easily, rather than one relying on 10 steps of conflicting confirmation before entering a new trade

trendlines enable us to maintain a fluid bias.

i mean, how much simpler can it be than "above this line bullish, below this line bearish" ? 😂

one trendline on its own can be enough to make a good trade, but when you put two together it can turn a good trade into a great one.
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Altcoin Sherpa
Altcoin Sherpa
@AltcoinSherpa
Quick Thread on #Altcoins/ #Altseason

Step 1: $BTC has a huge correction. Every range starts with either a pump (or dump) and then follows with a dump (or pump). In this case, #Bitcoin pumped and is now pulling back. This is


Step 2: $BTC ranges big once it finds a bottom. This will allow it to reaccumulate for a big summer run in 2021. This is HEALTHY IMO.


Step 3: Once $BTC finds a bottom and starts to grind up again, I expect $ALTS to do very very well in both alt/usd and alt/btc pairs. ALTSZN is almost always characterized by strong alt/btc pairs moving- I've already accumulated most and have done my final buying today and more.

$BTC.D typically has a very nice time during this time of the year. I was off on December prediction bc I thought $BTC was going to pull back by then but oh well! #Altcoins will start their pumping time VERY soon now.


More information on what #Altseason is and $ALTS market
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