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Crypto Guides

Decentralized File Sharing – An Efficient Approach To File Transfers?

Introduction

An efficient file storage method, decentralized file-sharing uses multiple nodes to store files instead of using a single centralized server. With the growing complexities on the internet due to the increasing rate of web data and files communicating through HTTP, it has become highly essential to use an efficient method to store data. When the online traffic is increased, the volume of information to be transferred mounts up automatically. As a result, if we want to transfer large files, we will need more bandwidth.

What Are The Issues And How Decentralized File Sharing Helps?

Addressing all these issues, decentralized file sharing emerged as a robust solution. Torrenting was the best solution for sharing available to the general public. It is used to transfer larger audio or video files over the internet without getting hampered by the challenges of HTTP. However, there were some drawbacks to the file-sharing protocols wherein the volunteers can restrict the services and disable the nodes that can limit the transfer.

With the help of blockchain technology, the decentralized file-sharing networks can be made robust. With this file-sharing network, users are provided with incentives for their contribution. This helps in ensuring that there are enough nodes to fuel the network.

The Potentials of MultiChain File Sharing

Multichain refers to an open-source structure, which enables users to deploy private blockchain for any enterprise. MultiChain supports Mac, Linux, and Window servers and offers a streamlined API as well as Command Line Interface.

This framework addresses the issues of privacy, openness, and mining through integrated user permission management. MultiChain is essentially a permission-based private blockchain that allows nodes to join and form a network. By enabling teams to create a well-integrated and secure network, MultiChain facilitates an efficient way of file-sharing.

Security Levels of Blockchain File Sharing

In the blockchain, we get enhanced security in file sharing. This technology offers multiple levels of security, including:

  • AES key encryption with RSA enables file access to merely by the receiver. Even if the files are accessible at all blocks, only specific receivers will have access to the file.
  • Files of equal size are divided and encoded through Hex encoding, which proves to be a potential way of sending files in the streams (blocks).
  • This is the most vital, powerful, and the highest level of security. Blockchain network offers the highest level of security by ensuring the fact that a file transfer occurs when all the nodes approve it within the network.
  • All nodes can certainly see when a transaction is happening between the senders and receivers without interfering with the process. The security level offers a guarantee that merely legitimate files can be transferred via the network.

The Bottom Line

By harnessing the full potentials of decentralized file sharing, we can enjoy stress-less and efficient file transferring that is not dependent on the nodes. Blockchain technology is an emerging technology that can make the file sharing process streamlined and more efficient. The above mentioned were some key highlights of decentralized file-sharing that we need to understand.

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Cryptocurrencies

Ethereum 101: Here Is Everything You Need to Know About Ethereum Blockchain

Any newcomer in the crypto sphere will soon notice the fuss around Ethereum – being one of the most talked and written about cryptocurrencies and the second most popular after Bitcoin. After breaking out in 2015, Ethereum has inspired not just crypto but the entire tech space for its novel offerings, which showed everyone that blockchain could be used for more than just digital money.

This article shines a light on the most nagging questions about Ethereum for crypto veterans and novices alike. From “what is Ethereum?” to “how do I mine Ethereum?” to why you should care about Ethereum, we cover it all.

What is Ethereum?

Ethereum is a public, distributed, and blockchain-based platform that allows individuals to create smart contracts and decentralized applications (DApps). Smart contracts are just like traditional contracts involving two or more people who come to an agreement on something. Except, smart contracts are self-verifying and self-executing and hence do not need intermediaries. Decentralized applications are a new kind of application not owned or controlled by third parties and, for this reason, are uncensorable.

How is Ethereum Different from Bitcoin?

Bitcoin was the first blockchain. It originated the idea of a public, open-source, decentralized, and immutable ledger system to verify, secure, and replicate transaction data across thousands of computers around the globe.

Ethereum takes the concept of Bitcoin and expands it. While Bitcoin was created solely as a peer-to-peer electronic cash system through which users can transfer value, Ethereum allows developers from anywhere to run code atop the network and create amazing applications. Applications can be of any nature really: be it voting, games, health records, finance, prediction markets, and more.

How Does Ethereum Work?

Ethereum is a decentralized platform, meaning no one owns it, and no one can delete records or censor it. It is decentralized courtesy of being distributed. The distributed status of Ethereum means anyone can access, see, and download the Ethereum ledger.

Think of a ledger that’s operated by several people with equal access and control. Each maintains a list of all transactions, and all records must be pre-approved by all parties. In this way, no one can modify, steal, or manipulate the data. The Ethereum blockchain operates much the same way, except that it’s thousands of people involved this time.

Transactions are verified by ‘miners’ who check the authenticity of transactions before adding them to the blockchain. Once a transaction goes on the blockchain, it’s immutable, meaning it can’t be deleted or reversed – by anyone.

The Ethereum blockchain and others like it, such as Bitcoin, have one security flaw known as  a ‘51% attack.’ This is a scenario in which an entity takes control of more than 50% of the computing power of the network.

This would essentially be holding the network hostage – and it would allow the perpetrator to double-spend coins, prevent transactions, and stop miners. While a 51% attack is plausible, it’s extremely rare. This is because for one to control over 50% of the computing power of a blockchain network, they would require an enormous amount of resources that are too expensive. Even the most funded person would find this an extremely tall order.

What Is Ether?

Ether (ETH) is the native cryptocurrency of the Ethereum blockchain. Developers use Ether to pay for the execution of commands on the Ethereum network. It’s also a tradable cryptocurrency and a digital store of value.

Where does Ethereum Derive Value? 

Ethereum derives its value from its ability to support smart contracts and a variety of decentralized applications. Although multiple other blockchain projects are taking after its model and are its direct competitors, Ethereum has the headstart advantage – courtesy of being the pioneer smart contracts and DApps blockchain.

Ethereum enables fast, secure, and inviolable processes – from contracts to voting, to record-keeping, and more. Usually, these processes would take days and significant amounts of money. Ethereum proposes to change this.

How Can I Mine Ethereum?

Ethereum mining utilizes a proof-of-work (PoW) consensus mechanism for verifying and confirming transactions.

PoW involves miners generating a random string of numbers (running the ‘hashing script’) until one of them finds the correct one. When that happens, they will broadcast the proof to the rest of the network, which will then allow them to confirm the next block of transactions. The idea is to ensure that anyone who gets to verify blocks has invested significant computational power (proof of work).

The PoW process involves miners competing with each other to find the solution first. The more guesses your machine can make per second, the better your chances of finding the solution fast and earning a reward – known as ‘miners reward.’ Currently, the successful mining of a block on the Ethereum network gets a miner rewarded 2 ETH. The reward was 3 ETH up until the Constantinople upgrade in 2019.

Ethereum mining is a straightforward process as long as you have the right equipment. First, you need to install two software packages. One of these is an Ethereum client that connects you to the Ethereum network and synchronizes the whole ledger, allowing you to see real-time the activities of all other network participants. It also avails all the data you need to start mining.

Ethereum clients are written in Geth and Parity, which are the blockchain’s most popular programming languages. The client’s come equipped with comprehensive instructions for installation.

The next thing is to install the mining software. The mining software is responsible for handling the guesses, while the client is responsible for updating the ledger – in real-time.

Beginner miners may find it more profitable to join a mining pool rather than go solo. A mining pool is a group of miners who combine their hashing power so as to improve the chances of finding the correct guess faster and earn rewards. The rewards are then split in proportion to the computational power each contributed.

Ethereum will not rely on mining forever, though. The network plans to ditch proof-of-work and transition into proof-of-stake (PoS). Unlike proof-of-work, which relies on computational power, proof-of-stake relies on stakeholders to secure the network and achieve consensus. PoS is not only faster but also consumes far fewer resources than PoW.

How to Buy Ethereum

Ethereum is the second most popular cryptocurrency, and so grabbing some Ether for yourself should be pretty straightforward.

One of the most popular ways to buy any cryptocurrency is to do so via a crypto exchange. Exchanges are platforms where people can buy and sell all manner of crypto. As of now, there are countless crypto exchanges available. Always ensure to purchase your crypto from a trusted and verified exchange. Some options include Coinbase, Binance, Huobi, Kraken, CoinEx, eToro, Coinswitch, BitMex, Changelly, Kucoin, BitStamp, Poloniex, and so on.

Alternatively, you could use peer-to-peer services, such as LocalCryptos, which allows you to transact directly with a local person selling crypto.

Once you grab yourself some Ethereum, you’re going to want to guard it jealously. This means keeping it in a safe place where hackers cannot reach. The best option is a hardware or paper wallet – which is both offline and impossible to get hacked, fall prey to phishing scams, and so on. Storing your coins in an exchange is a complete no-no. Exchanges are notorious for getting hacked, and there is no guarantee that you will get your money back should this happen to your exchange.

How Much Does Ethereum Cost? 

Like any cryptocurrency, Ethereum is subject to volatile and unpredictable price changes, making it impossible to predict a definitive price for the currency at any given time.

As of May 19, 2020, Ethereum is trading at $210.16. This is a far cry from its all-time high of $1432.88 on Jan 13, 2018. But it’s a marked improvement from its all-time low of $0.420897 in 2015.

Buying Ethereum involves speculation, just like for any other crypto. If you have the money now, but it’s not enough to quite hit the mark, you can wait until the price fluctuates down and swoop in.

Fascinatingly, Ethereum is divisible up to 18 decimal places. This means you can buy as little as 0.000000000000000001 Ethereum. You can buy whichever amount you want, whether it’s 1%, 40%,50% and so on.

Why Should I Care about Ethereum?

You should care about Ethereum because it has the potential to revolutionize how we do things across industries. Ethereum is also one of the stalwart cryptocurrencies – not “making a splash today and gone tomorrow.” What’s more, organizations such as the Ethereum Enterprise Alliance are designed to drive the adoption of Ethereum blockchain technology across industries, pushing it closer to the mainstream.

For this reason, you can be assured the currency is a guaranteed, long-term store of value. Despite competitor projects emerging, Ethereum has the star and pioneer power to keep it ahead of the curve.

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Cryptocurrencies

Exciting Use Cases of Decentralized Finance

Today’s finance landscape is inherently unequal – with millions locked out of opportunities due to their location, being undocumented, or having low economic means. 

Few would have foreseen that the technology that brought us Bitcoin could potentially solve this enduring problem. 

Decentralized finance (DeFi) is all of these things: an idea, a belief system, a movement, and a blockchain-based technology that promises to eradicate the aforementioned barriers to financial access, or to put it another way, to democratize finance. Already, decentralized finance is making waves as DeFi platforms and products increase by the day. 

In this guide, we explore some uses cases of this new and exciting technology, as well as some of the real-life applications that are making brave inroads into the space. 

But before we do that, let’s kick off with a primer on what exactly DeFi is, plus why we need it. 

What is Decentralized Finance? 

Decentralized finance is an emerging, blockchain-based ecosystem of finance that seeks to expand finance.  

It aims to make financial services more accessible and inclusive for everyone by making financial markets and products open-source, transparent, and under no particular authority. 

In DeFi world, everyone would have absolute control over their assets and interact with other participants through peer-to-peer (P2P), decentralized applications (DApps). 

What Problems Does DeFi Solve? 

DeFi’s chief goal is to decentralize financial services and make them available to all – an aspect that today’s centralized financial system is sorely lacking. As such, DeFi solves two main problems which we’ll look at in greater detail below: 

Inequality in Finance. Today, millions of people are locked out of access to loans, mortgages, a bank account, savings, insurance, and so on. DeFi aims to eradicate or alleviate this problem by creating a finance system that has no systemic or institutional barriers. All one would need is a smartphone and internet connectivity to access services.  

Financial Censorship. Today’s centralized finance system means that governments, banks, or intermediaries can restrict or prevent an individual’s or a company’s access to their assets. For example, the government could freeze the assets of a company that openly defies it, or an individual that it perceives to be rogue. By contrast, with DeFi, financial products are under no one’s control. Hence no one can arbitrarily restrict an individual’s or company’s assets. 

What Are the Advantages of DeFi?

Why should you care about DeFi? What difference does it propose to the current financial system? These are some of the advantages of DeFi: 

Autonomy: DeFi applications do not need a go-between party in transactions or an arbitrator in case of disputes. All terms are set in the code, and users have complete autonomy over their funds at any time. This eliminates the costs that would go into providing such intermediary services.   

Security: Since DeFi services are set up on decentralized blockchains, single points of failure are eliminated. Data is recorded on the blockchain and distributed across computers all over the world, reducing the chances of services being compromised.

Tradability: Thanks to DeFi, the tokenization of assets is now possible. Tokenization means one can quickly sell an asset that was previously illiquid (not fast-moving), as well as divide an asset into parts that enable many market participants to buy just the portion they can afford, instead of losing out on a whole investment.

Accessibility. The world’s unbanked can access financial services that they previously couldn’t, thanks to DeFi. 

What Are The Use Cases For DeFi? 

The following are some of the potential use cases for DeFi: 

i. Payments

DeFi platforms or applications can be used to create blockchain-based protocols that allow individuals to have wallets via which they can make instant and cheaper payments. 

ii. Borrowing and Lending

DeFi enables open lending structures that have numerous advantages over the traditional borrowing and lending system, including: 

  • Ultrafast transaction settlements 
  • Ability to back up digital assets with real-life assets 
  • Credit checks are not necessary; hence more people can get access to loans
  • Potential standardization and interoperability of financial services, making them frictionless across various providers 
  • Democratizes the borrowing and lending process by providing borrowers with a wider pool of potential lenders.    

iii. Stablecoins

A stablecoin is an asset that attempts to circumvent the price swings in cryptocurrencies, making them suitable as mediums of exchange and stores of value. Stable coins thus provide the stability associated with fiat currencies while maintaining the benefits of cryptocurrency such as security, fast processing speeds, and overall efficiency. 

iv. Tokenization

This is the process of digitizing a real-world asset to increase its liquidity in the marketplace. Tokenization creates asset-backed tokens – which are digital tokens backed by real-world assets. Through tokenization, assets that traditionally have low liquidity, e.g., jewelry, real estate, and art, can quickly move their position in the marketplace. Also, thanks to the ability to divide assets into portions through tokenization, non-high income earners can get a piece of a product or investment that they previously couldn’t afford.  

v. Decentralized Exchanges (DExes)

Decentralized exchanges are platforms where users can exchange digital assets without relying on a third party, as in a centralized exchange. Instead, trades occur between parties in a P2P, automated process. Examples of DExes include Binance DEX, Radar Relay, and EtherDelta. 

vi. Issuance Platforms

An issuance platform is a service that allows people to tokenize their assets by providing them with the tools to create digital tokens. An issuance platform provides the necessary technical and legal infrastructure to ensure a seamless tokenizing process for users.   

Thanks to these platforms, individuals and companies can raise funds without the costs associated with intermediaries such as banks, credit unions, lawyers, etc. They also open up investment opportunities for investors of all net worth levels, origin, or geographical location. 

vii. Open Marketplaces

With open marketplaces, DeFi reimagines the age-old idea of a marketplace by turning it into a decentralized platform where people can exchange things of value. 

People can buy and sell non-fungible tokens (ones that are unique and thus not interchangeable, as opposed to fungible tokens such as Bitcoins that are interchangeable) such as trading cards, collectibles, domain names, game items, and so on. All transactions take place via blockchain-based smart contracts, removing the need for a central authority who would normally dictate the rules of the marketplace.  

viii. Prediction Markets

A prediction market is a group of participants who speculate on the outcome of future events – from elections to games to weather to natural disasters to commodity prices to major political events. 

DeFi provides a decentralized take on traditional betting markets such as casinos. Decentralized prediction markets are censorship-resistant, thus democratizing the betting space. For instance, individuals can participate in betting on their favorite sports events even if they live in jurisdictions where betting is restricted. It also means that anyone can create a bet without the approval of a central authority like, for instance, the administrator of a betting platform.

ix. Decentralized Autonomous Organizations (DAOs)

These are organizations that allow individuals to create organizations whose rules and bylaws are encoded on the blockchain. DAOs represent the highest degree of organizational transparency, with every process automated and with minimal to no human input needed. They solve the problems of centralized, hierarchical setups such as corruption, arbitrary decision making, delayed decision making, and so on. 

Real-Life Applications of DeFi

The DeFi world is up and running with applications that are already making their impact felt. The following are some of the most popular DeFi use cases out there today:

☑️MakerDAO. This is a decentralized autonomous organization running atop Ethereum’s blockchain. It has a dual coin system that aims to mitigate the volatility of cryptocurrency. The MakerDao platform has two tokens: Maker – which is volatile and fluctuates like any other crypto and is used to govern the Maker platform, and DAI, a decentralized stablecoin whose value is fixed in a 1DAI = 1USD formula. Makercoin utilizes external market economics to allow DAI to be a stablecoin.  

☑️Dharma Protocol. This is a finance application based on the Ethereum blockchain that democratizes borrowing and lending. As a lending platform, Dharma has all the works of a traditional lending platform – except that it expands finance in that anyone, anywhere, can access the Dharma platform as long as they have an internet connection. 

☑️Uniswap. Uniswap is an Ethereum blockchain-based decentralized exchange that allows individuals to trade ether and ERC-20 tokens. Thanks to its decentralized protocol, there is no need for middlemen – which saves costs, and users have complete autonomy over their crypto holdings.

☑️Bloom. Also, Ethereum-based, Bloom is a credit scoring and identity verification platform that aims to reduce credit fees, increase credit access, make credit histories shareable across countries, and make credit risk assessment fairer. Through Bloom, individuals with little to no credit stand a better chance to get access to loans. 

☑️dYdX This is a DEx that allows traders to exchange cryptocurrency derivatives. Derivatives are financial instruments that derive value from an underlying asset, e.g., Bitcoin futures. Via dYdX, traders can exchange their crypto derivatives of choice in a censorship-free, peer-to-peer, and fairly priced environment. 

Final Thoughts

By creating a financial system that’s open to all, accessible, affordable, and transparent, DeFi promises to wrestle economic power from those at the top and give it back to the people. And it proposes a powerful use of blockchain technology – decentralized financial services ranging from lending to asset issuance, to open marketplaces, to prediction markets, to censorship-free crypto exchanges, and more.

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Crypto Daily Topic

Golem: The Disruptive Blockchain You Haven’t Heard About

The first-ever cryptocurrency – Bitcoin, brought along with it a host of possibilities that couldn’t be imagined before. The technology behind it – blockchain, is now being incorporated into various facets of our lives – from letting people share monetary value to hard drive storage and now, thanks to Golem, a way to let people share computing power.

Golem is a global, open-source, and a decentralized supercomputer that combines the computing power of machines in its network – from PCs to data centers. The idea is to capitalize off of idle computing power by letting users rent processing power to other users and being paid for it. The Golem concept was in development for three years before being launched in the Ethereum blockchain.

How Golem Works

Golem’s end goal is to build a distributed and decentralized supercomputer by connecting computers around the world via its blockchain.  Golem users will be able to rent their spare computing power to other users who will, then, pay with the Golem Network Token (GNT). The network will allow you to perform such tasks as artificial intelligence (AI), Computer Generated Imagery (CGI) rendering, simulating neural networks, machine learning, DNA sequencing, scientific computing, simulation building, and more.

The interesting coincidence is that Golem has built its decentralized computer on the decentralized Ethereum network – making it a decentralized supercomputer on a decentralized computer. So how will users transact on the Golem network?

Now, the user buying computing power is the requestor, and the one renting it out is the provider. Let’s assume the requestor’s task is the same class as one of the task templates that Golem provides. If it isn’t, they would have to write their own code for the task using the task definition framework provided by the network.

The provider receives all the broadcasted task offers and chooses the best one based on each one’s reputation. They then send the price and the computing power info to the requestor. The requestor then assesses the provider’s reputation to determine if to go ahead and work with them. If everything checks out, the provider receives the appropriate resources through the InterPlanetary File System (IPFS) and initiates the computation on the task computer. (IPFS is a peer-to-peer file and data sharing system in a distributed file network.)

The task manager then passes this info to the appropriate node for verification of the results. (The requestor may also decide to run the info via numerous nodes). Lastly, the payment system is notified through an Ethereum smart contract, allowing the funds to be transferred from the requestor to the provider. The reputation of both parties relies on each one’s execution in the transaction: the provider sending accurate results and the requestor paying promptly.

The Golem Network Token

The Golem Network Token is the native currency of the Golem network and is the medium through which requestors pay for renting computing power. The token can only be used to transact in Golem’s products and services. 

GNT has a total supply of 1 billion. Its Initial Coin Offering took place in November 2016, during which 820m coins were distributed. It has an impressive record of raising 820,000ETH (around $340m) in 20 minutes. Another 120m was held by the Golem project, and the rest of 60m was distributed among Golem’s team members.

The token cannot be mined. You can earn it by sharing your free processing power. The more power you share, the more you GNT you earn.

Supercomputing and Golem’s Plan

Supercomputing is one of the modern age’s most crucial innovations. New technologies such as machine learning, CGI, artificial intelligence, and scientific computing require a lot of processing power.

The Golem whitepaper has planned four key network supercomputing milestones for the network in the following progressive order: Brass, Clay, Stone, and Iron. The network first released Brass – which includes Blender and LuxRender, two software programs for CGI rendering.  Later releases are scheduled as follows:

☑️ Clay – which includes the Application Registry and Tak API

☑️ Stone– which includes the Certification Mechanism and Transaction Framework. Users will be able to use this release in a Software as a Service model (SaaS)

☑️ Iron – this release will feature more security and stability and will allow developers to design applications that can run outside the sandbox

As of now, the network is still in the Brass stage. As a result, disappointed fans have accused it of “over-promising and under-delivering.” Others contend that a slow and secure approach is crucial for a project of such an ambitious scale.

Could Golem Profit Off Of Artificial Intelligence and Supercomputing?

Golem could definitely make money as a hosting solution – if it works as planned. The company could make money by hosting digital supercomputers and AIs. Let’s say, for example, a government institution with spare computing power. It could rent its extra power through Golem.

Meanwhile, a new tech company that needs a supercomputer could use one through Golem – by renting the institutions’ extra computing power. This would be a convenient and cost-efficient alternative to buying or renting.

Unfortunately, there is no indication that the network is offering these services as of yet. It’s worth mentioning though that the Golem website suggests the possibility of hosting decentralized apps (DApps) – which could provide a suitable environment for the above services.

These decentralized apps would find a ready market. For instance, a filmmaker in Australia who wants to add CGI to their movie could use the Golem CGI DApp. A DApp maker in Japan could make money by renting or selling their DApp to the filmmaker using the Golem platform.

Could Golem Profit Off Of AI and Supercomputer DApps?

AI and supercomputer DApps are technologies in a lot of demand across multiple industries these days. A network that can host and avail them to organizations is in for profit.

Industries ranging from game development, data harvesting, intelligence, scientific research, and AI building are all in need of supercomputer DApps.

Meanwhile, AI DApps could find use in autonomous vehicles, hedge fund management, store management, financial investment, online gaming, financial services, robotics, industrial equipment, and scientific research.

Do Supercomputer DApps Have Money Making Potential?

Although at this point, these two are theoretical, they have market potential, especially considering regular apps are already very popular.

Statistics estimates the Apple Store apps generated $120 billion in aggregate revenue by January 2019. It’s worth noting App Store developers made that money with simple entertainment apps. Golem could offer apps with way more utility. Institutions ranging from governments to universities to labs to research organizations could pay a lot of money to use such apps. 

Is Golem A Cryptocurrency worth your time?

Golem stands out for its disruptive technology and potentially lucrative application of blockchain technology than for its cryptocurrency. Also, its cryptocurrency’s value remains hypothetical until the network enables a blockchain supercomputer. 

As of November 20, 2019, Golem is the 93rd most valuable cryptocurrency according to the crypto tracking website CoinMarketCap. It has a coin price of $0.042789 and a 24-hour volume of $2,599, 810. Its circulating supply is 980, 050, 000 while its market capitalization stands at $41, 934, 880. Its all-time high was $1.25 on January 08, 2018, with its all-time low coming to $0.008797 on December 12, 2016.

Essentially, Golem presents this deal to investors: you could make a lot of money in the long run if you’re willing to lose some now. While its cryptocurrency is cheap now, its blockchain holds massive potential. However, individual investors would better hold off for now as there is no indication of the network presently making any money.

Conclusion

Golem is an ambitious idea – and for a good reason. It’s decentralized, open-source, and worldwide supercomputing promise is good news across multiple industries. Whether as a recruiter or provider, many organizations will find the platform extremely valuable. The team’s slowness has been a bit disappointing, though. Will it turn out to be another hyped but hollow proposal, or is the slow and steady pace a winning strategy? The crypto community is watching to see how this turns out.