Matrixport View_Technology #6

Matrixport Research

Summary

Medalla, the last step towards ETH 2.0 mainnet, was finally launched. Despite the successful launch, there were some hiccups along the way as Medalla suffered from a lower than expected validator participation rate and a bug that crashed the testnet. However, the bug issue has been resolved and the testnet launch has been smooth and ongoing since.
BCH is facing a potential fork as the two main node operators, BCHN and Bitcoin ABC, have been disputing about the Difficulty Adjustment Algorithm (DAA). Both operators wish to implement their own version of DAA while discussion has yet to yield any positive results.
In other news, Monero introduced its new CLSAG to replace its old MLSAG to improve overall efficiency of the blockchain. Filecoin has released its 32-page report on the Filecoin Economy, highlighting its value propositions and token economics.
Within a month, ETC suffered multiple 51% attacks on the network, accumulating over $7.3m losses. The ETC team has been working to fix the problem and actively preventing future attacks. In addition, there have been ongoing security breaches across DeFi platforms.

Public Blockchain: Mainstream Tokens

Launch of “Medalla”, an ETH 2.0 Multiclient Testnet

Testnet Launch☆☆☆

As announced previously, Medalla testnet was launched on 4th August without any delays
Medalla, the last testnet before ETH 2.0 mainnet, is a multiclient and community based testnet where the stability and health of the blockchain is dependable on the participation of Ethereum validators
While the level of participation from validators were lower than expected, the overall testnet has performed according to expectation, with plans to initiate phase 1 of the testnet to build on the current phase 0’s success (Medalla is a multi-phase testnet)

Developers Released Fix and New Upgrade for “Medalla” Testnet

Testnet Fix☆☆☆

Shortly after Medalla testnet was launched, on August 14, a bug crashed the network causing validators fell out of sync
Google Cloudflare’s Network Time Protocol (NTP), a third-party web infrastructure provider used by Prysm to adjust users’ clocks, was off by about four hours, causing the networks internal time clocks to fall out of sync
Validators began to incorrectly propose future blocks and were unable to process blocks properly or receive rewards and transaction fees
Prysmatic Labs team quickly initiated a few quick fixes and later publish an update to resolve the ongoing sync issues on the testnet

BCH Runs into Dispute with Potential new BCH Fork

Forking☆☆☆

With less than 3 months left till the next Bitcoin Cash upgrade, the community has been embroiled in dispute regarding the newly proposed Difficulty Adjustment Algorithm (DAA)
The two major BCH nodes, BCHN and Bitcoin ABC, have been in dispute as both sides wish to implement their suggested version of DAA, leading to a potential split
In addition, Haipo Yang (ViaBTC CEO) announced a new fork of Bitcoin Cash called Bitcoin Cat, adding to the confusion surrounding the future of BCH

Public Blockchain: Others

Monero Introduces CLSAG to Improve its Efficiency

Code Update☆☆

Monero introduces the new Concise Linkable Spontaneous Anonymous Group (CLSAG), a replacement for the linkable ring signature scheme, MLSAG
CLSAG combines the verification of the output’s ownership and transaction balances into one ring signature and computes them simultaneously resulting in higher efficiency as compared to two separate computations needed in MLSAG previously
With the implementation of CLSAG, users will see an 20% improvement in signature verification, and at least 10% overall improvement for typical transaction

Filecoin Released its Report on Filecoin Economy

Report/Whitepaper☆☆

Filecoin released a 32-page report on its Filecoin Economy, depicting its value proposition and token economics
There will be a total of 2b FIL (Filecoin’s native token), 5% will be allocated for Filecoin Foundation, 10% for fundraising, 15% for the participating protocol labs and team, 55% for storage mining for miners as rewards and the remaining 15% will be kept as mining reserve to support the future growth of the Filecoin economy
Based on its roadmap, Filecoin will likely launch its mainnet and FIL token around mid-September 2020, however the dates are tentative and may be pushed back

Blockchain Adoption in Traditional Industries

Financial Industry

North America’s Coca-Cola bottling supply chain is dipping its toes in the DeFi ecosystem with its new project launch. Partnering with The Baseline Protocol (a middleware solution for large companies), the project enables the bottlers to communicate and transact privately on the Ethereum public blockchain, access DeFi applications, and tokenize assets. (Ethereum blockchain; Partnership achieved ☆)
Standard Chartered Bank has successfully executed Bangladesh’s first blockchain transaction by issuing a Letter of Credit (LC) for Viyellatex Ltd over the Contour blockchain network. (Contour blockchain; Partnership achieved ☆☆)
Multiple South Korean banks are making plans to launch crypto custody services by end of 2020 or by March 2021 latest. With the change in internal policy, Nonghyup aims to be the first bank to offer crypto custody services to institutional investors. (Custody Services; Proposed launch ☆)
China Construction Bank (CCB) launched its wallet services for digital currency electronic payment (DCEP) to public users, where users can register for a DCEP wallet within its mobile app. The news represents a significant step in China’s commitment to launch DCEP and is viewed as a positive development. However, due to overwhelming interest and scrutiny, CCB has disabled the function temporarily and will look to reintroduce the function at a later date. (DCEP; Proposed launch ☆☆)

Security Incidents

Public Blockchain

On 1st Aug, the ETC blockchain network lost $5.6m to one miner following the first 51% attack on the system. The offending miner managed to double-spend 807,260 ETC. ETC network underwent deep chain reorganization as a result of the attack. ☆☆
A second 51% attack occurred on 6th Aug where an additional $1.7m was stolen. Since then, ETC has implemented several solutions to address these attacks and prevent future ones. Solutions include more robust monitoring and rapid response systems, technical implementations, and partnerships with miners and mining pools to bring higher hash rate. ☆☆
ETC suffered another large 51% attack on 30th August, resulting in a reorganization of over 7,000 blocks (approximately 2 days’ worth of mining). ETC will remove all lost blocks from the immature balance and check all payouts for dropped transactions. The total amount lost via the attack was undisclosed. ☆☆

DeFi

An exploit on the Opyn ETH put contracts allowed an attacker to “double exercise” oTokens and steal the collateral posted by certain sellers of these put contracts. Approximately 371,260 USDC was stolen from these contracts, with further investigation ongoing to determine the exact losses. ☆
A week after launch, YF Value protocol (a new DeFi protocol focus on Yield Farming Finance) suffered a congential bug that might cause the crypto staked ($130m) being locked out by a single contract owner. YFValue decided to burn the minter key at the checkNextEpoch, and relaunched the protocol. Users who do not remove their funds from the pool before the deadline will lose their assets forever. ☆

Importance level：low-☆; medium-☆☆; high-☆☆☆

Sources: Blockchain News, Bitcoin.com, Coinmarketcap, Monero, Decrypt, Cointelegraph, Medium, Filecoin, Twitter analyzed by Matrixport

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