Understanding DeFi Lending
Lending stands out as one of the pinnacle applications of blockchain and crypto. But it's not just a claim... It's also the 2nd biggest DeFi narrative in terms of Total Value Locked (TVL)!Let’s break down this concept ELI5. (Explain Like I’m 5) We’ll cover:Lending in TradFi vs DeFiHow DeFi Lending Platforms WorkKey Elements to MonitorCase Study7 Risks to Consider4 Core BenefitsLet’s goo.1. Lending in TradFi vs DeFiPicture this:🌐 Traditional Finance (TradFi): Want a loan? Prepare fo...
Understanding Liquid Staking
Liquid staking is the biggest DeFi narrative in terms of TVL.Let’s break down this concept from its root ELI5. (Explain Like I’m 5) We’ll cover:Understanding Blockchain TransactionsThe Dinner Party AnalogyThe Liquid Staking EraStaking vs Liquid StakingRisks Associated w/ Liquid StakingLet’s goo.1. Understanding Blockchain transactionsBefore introducing the notion of staking, we need to come back to the basics first. How a transaction operates on the blockchain. It’s actually pretty simple:Con...
Understanding Liquid Restaking
This new narrative taps into a $45B market. In this article, we’ll cover how you can benefit from it before the masses.From Staking to Liquid StakingEntering The Restaking EraLiquid Restaking & OpportunitiesFrom Staking to Liquid Staking In our Liquid staking article, we covered the basics of blockchain transaction (tx). In a nutshell, to confirm tx on the blockchain, validators need to find an agreement method that will benefit all. This is called the Consensus.2 most popular ones are PoW (P...
Understanding DeFi Lending
Lending stands out as one of the pinnacle applications of blockchain and crypto. But it's not just a claim... It's also the 2nd biggest DeFi narrative in terms of Total Value Locked (TVL)!Let’s break down this concept ELI5. (Explain Like I’m 5) We’ll cover:Lending in TradFi vs DeFiHow DeFi Lending Platforms WorkKey Elements to MonitorCase Study7 Risks to Consider4 Core BenefitsLet’s goo.1. Lending in TradFi vs DeFiPicture this:🌐 Traditional Finance (TradFi): Want a loan? Prepare fo...
Understanding Liquid Staking
Liquid staking is the biggest DeFi narrative in terms of TVL.Let’s break down this concept from its root ELI5. (Explain Like I’m 5) We’ll cover:Understanding Blockchain TransactionsThe Dinner Party AnalogyThe Liquid Staking EraStaking vs Liquid StakingRisks Associated w/ Liquid StakingLet’s goo.1. Understanding Blockchain transactionsBefore introducing the notion of staking, we need to come back to the basics first. How a transaction operates on the blockchain. It’s actually pretty simple:Con...
Understanding Liquid Restaking
This new narrative taps into a $45B market. In this article, we’ll cover how you can benefit from it before the masses.From Staking to Liquid StakingEntering The Restaking EraLiquid Restaking & OpportunitiesFrom Staking to Liquid Staking In our Liquid staking article, we covered the basics of blockchain transaction (tx). In a nutshell, to confirm tx on the blockchain, validators need to find an agreement method that will benefit all. This is called the Consensus.2 most popular ones are PoW (P...
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🔍 How does modularity elevate blockchain potential?
#ELI5
🔗 Unpacking the Blockchain Layers
Blockchains are generally made up of four core layers:
Data Availability: Ensures that all network participants can access data.
Consensus: Mechanism to agree upon the validity of transactions.
Settlement: Finalizing transactions and adding them to the ledger.
Execution: The actual process of executing smart contracts and transactions.
Monolithic blockchains, commonly known as Layer 1 (L1) - such as Ethereum, Bitcoin, and Solana - manage these layers in-house.
🔗 The Blockchain Trilemma
A central challenge in blockchain development is optimizing three key elements:
Security: Safeguarding against threats and vulnerabilities.
Scalability: Handling a large number of transactions efficiently.
Decentralization: Ensuring a dispersed power structure.
However, as Vitalik Buterin emphasized in the "blockchain trilemma", achieving perfection in all three elements simultaneously is a Herculean task:
Ethereum prioritizes security and decentralization, somewhat sidelining scalability.
Solana, focuses on scalability and security, with some trade-offs in decentralization.
So, how do we navigate this trilemma?
🔗 The Rise of Layer 2 Solutions (L2s)
L2s are blockchains designed to operate atop an existing L1, enhancing its functionalities.
A prime example is Arbitrum, an L2 developed to amplify Ethereum's scalability.
This blockchain architecture brings forth the concept of modularity.
To augment its performance, one blockchain could seamlessly integrate with elements from other blockchains.
The advent of modularity is reshaping the blockchain landscape & paving the way for more robust and adaptive blockchain ecosystems.
Blockchain modularity can go even further but we’ll cover this in part2.
Author:
Diane from ALMAZE MEDIA
Web3 agency helping crypto projects with organic content strategy and production (educational & marketing) from short form social media posts, newsletters to explainer videos.
Want to discuss ?
🔍 How does modularity elevate blockchain potential?
#ELI5
🔗 Unpacking the Blockchain Layers
Blockchains are generally made up of four core layers:
Data Availability: Ensures that all network participants can access data.
Consensus: Mechanism to agree upon the validity of transactions.
Settlement: Finalizing transactions and adding them to the ledger.
Execution: The actual process of executing smart contracts and transactions.
Monolithic blockchains, commonly known as Layer 1 (L1) - such as Ethereum, Bitcoin, and Solana - manage these layers in-house.
🔗 The Blockchain Trilemma
A central challenge in blockchain development is optimizing three key elements:
Security: Safeguarding against threats and vulnerabilities.
Scalability: Handling a large number of transactions efficiently.
Decentralization: Ensuring a dispersed power structure.
However, as Vitalik Buterin emphasized in the "blockchain trilemma", achieving perfection in all three elements simultaneously is a Herculean task:
Ethereum prioritizes security and decentralization, somewhat sidelining scalability.
Solana, focuses on scalability and security, with some trade-offs in decentralization.
So, how do we navigate this trilemma?
🔗 The Rise of Layer 2 Solutions (L2s)
L2s are blockchains designed to operate atop an existing L1, enhancing its functionalities.
A prime example is Arbitrum, an L2 developed to amplify Ethereum's scalability.
This blockchain architecture brings forth the concept of modularity.
To augment its performance, one blockchain could seamlessly integrate with elements from other blockchains.
The advent of modularity is reshaping the blockchain landscape & paving the way for more robust and adaptive blockchain ecosystems.
Blockchain modularity can go even further but we’ll cover this in part2.
Author:
Diane from ALMAZE MEDIA
Web3 agency helping crypto projects with organic content strategy and production (educational & marketing) from short form social media posts, newsletters to explainer videos.
Want to discuss ?
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