Coin Burning: A Guide

Coin burning is a concept exclusive to the cryptocurrency marketplaces, having been adopted by a wide range of coins and tokens. Though it may sound hard core, but coin burning is a central mechanism that could prove to be a popular feature for cryptocurrency projects down the road. In fact, many Initial Coin Offerings (ICOs) have integrated a coin burning mechanism for unsold tokens at the end of their token sale. Not only that, but major exchanges with their own native tokens – like Binance – also adopt a periodic token burning mechanism to add value for those who hold Binance Coin (BNB).

There are of course, many motivations for projects to consider a coin burn structure. This guide will delve lengthily into the mechanics of coin burning to provide a new outlook on what the future holds for the cryptocurrency marketplace.

Coin burning – as the name suggest – is a process of intentionally ‘burning’ or eliminating the coins by rendering it unusable. This is done by sending a portion of the coins to an ‘eater address’, which is often referred to as a ‘black hole’ since the private keys to that address are not obtainable by anyone. Therefore, any coins sent to an eater address are unrecoverable and cannot be used again, forever! These coins are effectively taken out of circulation and is publicly recorded and verifiable on the blockchain.

Reasons for Coin Burning

1) MORE EFFECTIVE CONSENSUS MECHANISM

This applies to coins that adopt Proof-of-Burn (POB) as their consensus mechanism. POB is a unique way of achieving consensus in a distributed network, requiring participants – miners and users – to burn a portion of coins. There are many variations of POB which will be discussed in the next section.

2) INCREASE VALUE OF COINS

In order to understand this, we need to understand the basic economic laws of demand and supply. Scarcity is a central economic concept that gives value to a particular asset and in this case, cryptocurrency. Unlike fiat currencies, cryptocurrencies are deflationary in nature. This means that the coin supply for most cryptocurrencies are fixed, with no additional coins created once it has reached its total supply count. The best example is Bitcoin, which has a fixed supply of only 21 million; if demand increases, prices would increase since there is a limited number of Bitcoin in circulation. Likewise, if the supply of Bitcoin further decreases – due to burning, lost private keys or forgotten Bitcoins – then prices would similarly increase since there is now a lesser number of Bitcoins to satisfy people’s demands.

Coin burning reduces the total supply in circulation since the coin is intentionally destroyed. It is an effective method of increasing and stabilizing the valuation of coins and tokens. Economic principles dictate that reducing the quantity of something makes it much more valuable!

3) PROTECTION AGAINST SPAM

Coin burning acts as natural mechanism to safeguard against Distributed Denial of Service Attack (DDOS) and prevent spam transactions from clogging the network. The same way how users pay a small fee for sending Bitcoin (BTC) or pay gas for smart contract computations in the Ethereum blockchain, coin burning creates a cost for executing a transaction. Instead of paying fees to miners to validate transactions, some projects have integrated a burning mechanism where a portion of the amount sent is automatically burnt. Ripple (XRP) is a project that utilizes this burning model.

4) SIGN OF LONG-TERM COMMITMENT

Coin burning is an effective tool to signal a firm commitment by a cryptocurrency project. The goal of any project is to add significant value to coin holders, who will probably be the core users and supporters of their service. Employing a coin burning mechanism to burn excess ICO tokens or provide periodic burning schedules (by buying back tokens from the open market using generated profits and thereafter burning them) would go a long way in reinforcing the project’s growth prospect.

Cryptocurrency Mining Explained

Cryptocurrency mining is one of the most regularly used approaches of validating transactions that have been executed over a blockchain network. Not only does blockchain work to protect transaction data through encryption, as well as store this data in a decentralized manner (i.e., on hard drives and servers all over the world) so as to keep a single entity from gaining control of a network, but also the primary goal is to ensure that the same crypto token isn’t spent twice. In effect, “mining” is one means of making sure that cryptocurrency transactions are accurate and true, such that they can never be compromised in the future.

Cryptocurrency mining itself refers to a type of validation model known as “proof-of-work” (PoW). There are two common validation types, and we’ll look at the other, known as proof-of-stake, in a moment.

In the PoW model — which bitcoin, Ethereum, Bitcoin Cash, and Litecoin use, to name a few — individuals, groups, or businesses compete with one another with high-powered computers to be the first to solve complex mathematical equations that are essentially part of the encryption mechanism. These equations correspond to a group of transactions, which is known as a block. The first individual, group, or business that solves these transactions, and in the process validates the accuracy of these transactions within a block, receives a “block reward.” A block reward is paid out as digital tokens of the currency that’s being validated.

As an example, the current block reward for bitcoin is 12.5 tokens. That means whoever is the first to correctly solve equations for a block is paid 12.5 tokens. With bitcoin near $9,500 per coin, that works out to a nearly $119,000 haul.

There are two major concerns attached to the PoW model. First, it’s an extremely electricity-intensive practice. To mine virtual currencies, massive mining centres with graphics processing units and/or ASIC (application-specific integrated circuit) chips are set up to handle this validation and processing. The electricity costs, depending on where an operation is located, can be enormous. It could also, in theory, be a drain on local or national electric grids, depending on how large digital networks and mining farms become.

The other issue is that the PoW model has a security vulnerability, at least for smaller digital currencies. Any individual or group that can gain control of 51% of a network computing power could essentially hold that network and digital currency hostage. Networks the size of bitcoin, Ethereum, and Litecoin have next to nothing to worry about. However, newly issued coins with fewer participants could be susceptible.

Though cryptocurrency mining might often be lumped in as one big free-for-all, there are differences in the equipment being used to validate transactions. For bitcoin, miners need to use highly specialized and expensive ASIC chips because of the difficulty in validating bitcoin transactions. Meanwhile, most other virtual currencies allow miners to use some variation of graphics processing units from the likes of NVIDIA or Advanced Micro Devices to proof transactions. However, the difficulty in this mining can still vary from one cryptocurrency to the next.

Lightning Network Explained

The Bitcoin Lightning Network is an autonomous solution that’s signaled as the key to all problems keeping Bitcoin from mainstream implementation. It claims to solve the bleak scaling problem, make instant transactions, keep transaction fees minuscule, and take your transactions off the blockchain.

In this article, we’ll discover what the Bitcoin Lightning Network really is, how it can make the guarantees it provides, and its current state. Bitcoin has a scaling problem. Bitcoin is designed to store all transactions in a data structure called a block. A block contains information about the previous block, miscellaneous data about mining rewards, and most of the block is just transaction data. Blocks are also fixed at a maximum of 1 MB in size. This last bit is where the trouble is.

Because blocks are 1 MB in size, and a block is created every 10 minutes, assuming the transactions are not SegWit (coming up later) the network can process a maximum of between 3.3 and 7 transactions per second. For a currency designed for mass use by billions of humans and their machines, 7 transactions a second just isn’t up to par. Visa, on the other hand, claims to be able to process 24,000 transactions per second.

As the number of transactions starts to increase, your individual transaction competes with every other for inclusion inside a limited block space, and so, the likelihood of having yours included in the block starts to decrease. Since miners can arbitrarily decide which transactions to include in a block, on these occasions, the only way to incentivize the miners to include your transaction is by increasing your transaction fee. However, this starts to make transactions prohibitively expensive—such as this 192 byte transaction for $92.98 where the transaction fee was $14.86.

The Bitcoin Lightning Network

The Lightning Network is a second-layer network that transmits signed, but un-broadcast, transactions among peers and relies on the Bitcoin blockchain only for final settlement of funds. This means that transactions aren’t limited to the block size at all, confirmation times are irrelevant, and the Bitcoin blockchain doesn’t need to store every transaction that ever happens.

Who developed the Bitcoin Lightning Network? It was first described in a white paper authored by Joseph Poon and Thaddeus Dryja but has since evolved into a community effort with third-party individuals and even companies contributing to specifications and implementations.

A Lightning node runs much like and unlike a Bitcoin node in that it operates in a networked fashion, validates transactions, and communicates with other nodes, but it does things that Bitcoin nodes historically do not: it holds funds, act as an automated financial intermediary, actively monitors Lightning “channels” for malicious behaviour and reacts defensively (this is explained in detail later), etc.

Blockchain and Remittance

Remittance is the transference of money from a migratory worker to someone back in their home country. People have always moved in search of better work forecasts in high-income (or high currency value as compared to home) countries. Based on the World Migration Report 2018, there are presently a projected 244 million international migrants living in other countries. This number has either unswervingly or indirectly contributed to the global remittance’s $689 billion-dollar industry with India being top of the pile, contributing $80 Billion or 11.6% of its entirety. The global remittance industry is expected to grow by more than 3% in 2019.

Blockchain can be the future for remittance

The most prevalent Cryptocurrency is Bitcoin. It has been labelled as the future of the global financial industry. Bitcoin positively has great potential to be the digital currency of the world but before that, one of two things needs to happen:

Bitcoin becomes less volatile
Products and Services everywhere become priced in Bitcoin rather than fiat

We are still a long way from that and therefore, let us focus our attention on not Bitcoin but on its underlying technology: the Blockchain Technology.

The key proponents of blockchain technology suggest that it can reduce the costs for remittance services. Interesting things are happening behind the scenes where blockchain technology is attempting to replace the current financial services industry’s centralized business model. Financial institutions and banks are exploring ways to implement blockchain to reduce transaction costs, increase transaction speed, reduce fraud and eliminate third-parties.

By cutting out the traditional middlemen, blockchain technology can speed up and simplify cross-border payments, making remittances more affordable. Currency fluctuations can result in a loss when transactions are being made cross borders and blockchain can provide an almost guaranteed, real-time transaction.

Distributed Ledger Technology or DLT can serve as the backbone for a new cross-border payment infrastructure that can potentially solve inefficiencies and provide a faster, secure and more affordable service.

The average transaction cost of remitting money currently is more or less 4–5% per transfer. This cost includes exchange rate margins, charges from both the sender and recipient intermediaries, agents, overheads etc in remitting USD500, USD20–25 will go into transaction fees. Online Money Transfer Platforms like TransferWise was able to reduce the cost to 1%. Blockchain can reduce the cost from 5% to a fraction of a percentage. This will drastically reduce the USD30 billion dollars in the cost of sending remittances to an absurd amount in the thousands and thus, be an effective cost-saving method.

Advantages and Disadvantages of Fiat and Cryptocurrency

Since we’ve already understood what fiat currency and cryprocurrencies are in our previous blog. Let’s look at what advantages and disadvantages that each of them entails.

Advantages of Fiat Money

Fiat Money has remained legal tender in most countries in part because they are highly stable and controlled. Unlike other forms of money, such as cryptocurrencies and commodity-based currencies, fiat currencies are relatively stable. The stability allows regulators and governments to navigate the economy against recession and inflation. Stability also allows fiat money to act as a means of storing value and facilitating exchange. It can also be used to provide a numerical account. Greater control also allows central banks to manage various economic variables such as liquidity, interest rates and credit supply key to ensuring a robust, stable economy.

Disadvantages of Fiat Money

Though Fiat Money is considered a stable currency, yet that is not always the case. Economic recessions over the years have highlighted some of the deficiencies associated with Fiat money. The fact that a central bank’s greater control at times does little to stop inflation or recession has led most people to believe that gold could be a much stable currency given its unlimited supply. The notion of central banks control over the economy and the constant increase in global prices create the need for cryptocurrencies.

Cryptocurrencies Advantages

Cryptocurrencies are available on a click of a button, all over the world. Anyone that can make an online transfer can also acquire and own a digital coin of choice. Although the process is still complicated, in the futures, it will be easier to transact and own cryptocurrencies.

Fast settlement times are another attribute that continues to accelerate widespread adoption of virtual currencies. Unlike other electronic cash settlement systems that take days to process transactions, cryptocurrencies enable instant settlements. Lower transaction fees have seen cryptocurrencies emerge as a preferred means of sending money across borders. Transferring money using other bank gateways can be quite expensive given the number of fees charged along the way. Privacy is another aspect that has made cryptocurrency desirable as users don’t have to share their identity to be able to complete transactions. There are altcoins which the main functions are to maintain the privacy of people behind transactions.

Disadvantages of Cryptocurrencies

Cryptocurrencies can be quite difficult to understand – one of the reasons why some countries and regulators continue to shun them. A lack of knowledge on how to use them is another headwind that continues to clobber digital currencies prospects and sentiments. The fact that it is not possible to reverse a transaction once it is made is another headache that has forced most people to shun cryptocurrencies. If a wrong a transaction is made the only thing one can do is ask for a reversal from the recipient. There is nothing one can do on recipients of a wrong transaction turning down a request for a refund. Volatility is by far the biggest disadvantage that has clobbered cryptocurrencies sentiments. Volatility goes a long way in affecting the value of a coin, which can be difficult to comprehend or contend with.

Fiat Currency Vs Cryptocurrency

Before we get into the the differences lets understand what Fiat currency and Cryptocurrency. Fiat Money is a kind of currency, issued by the government and regulated by a central authority such as a central bank. Such currencies act like legal tender and are not necessarily backed by a physical commodity. Instead, it is based on the credit of the economy.

Fiat currencies such as the US Dollar, Pound or Euro derive their value from the forces of supply and demand in the market. Such currencies are always at risk of becoming worthless due to hyperinflation as they are not linked to any physical reserves such as commodities.

Fiat currency first came into being at around 1000 AD in China before spreading to other parts of the world. Initially, currencies were based on physical commodities such as gold. It is only in the 20th century that President Richard Nixon stopped the conversion of U.S dollar into gold.

A cryptocurrency is a form of digital or virtual currency that can work as a medium of exchange. Being virtual in nature, they use cryptography technology to process, secure and verify transactions.

Unlike Fiat currencies, cryptocurrencies are not controlled by any central authority such as a central bank. Instead, they are limited entries in a database such as a blockchain that no one can change or manipulate, unless certain conditions are met.

Cryptocurrencies came into being as a side product of Satoshi Nakamoto, the brainchild behind Bitcoin cryptocurrency. Nakamoto did not intend to develop a currency but a peer-to-peer electronic cash system for facilitating transactions without any central oversight.

The decentralization aspect of the network means there is no central server where transactions are hosted or controlling authority. In a decentralized network like Bitcoin, every transaction to have ever happened is displayed for everyone to see. Each transaction file also consists of senders and recipients’ public keys.

Differences Between Fiat Money and Cryptocurrencies

While both fiat money and cryptocurrencies can be used as a means of payment, there are some differences.

Legality

Governments issue fiat currencies, which are in return regulated by the central bank. Fiat money is deemed legal tender in that it is often the official means of finalizing transactions. Governments control fiat money supply and issue policies from time to time that affects their value.

Cryptocurrencies, on the other hand, are merely digital assets that act as a medium of exchange that governments have no control over. The decentralization aspect means no central body can control or influence their value.

Some countries have banned cryptocurrencies on concerns that some of them are being used to fuel illegal activities such as terrorism and money laundering.

Tangibility

It is not possible to have a physical feel of cryptocurrencies as they operate online as virtual coins. Fiat currencies, on the other hand, have a physical aspect as they can exist as coins and notes thus possible to have a physical feel. Fiat money physical aspect at times does present a lot of challenges as it can be a nuisance to move around with vast chunks of money.

Exchange Aspect

Cryptocurrencies exist in digital form as they are created by computers and operate as private pieces of code. The means of exchange is thus purely digital. In contrast, fiat money can exist in both digital and physical form. Electronic payment services allow people to transfer fiat money digitally. In addition, people can transact with one another and exchange money physically.

Supply

A major difference between fiat money and cryptocurrency has to do with supply. Fiat money has an unlimited supply which means central authorities have no cap to the extent in which they can produce money.

Most cryptocurrencies have a cap when it comes to supply, which means there is a set amount of coins that will ever be in supply. For example, the total number of Bitcoin coins that will ever be in supply is capped at 21 million.

With fiat money, it is impossible to tell the amount of money in circulation at any given time, but with cryptocurrencies, it is possible.

Storage

Cryptocurrencies virtual aspect means they can only exist online thereby stored in digital wallets commonly referred to as cryptocurrency wallets. While most digital wallets claim to offer secure storage, some of them have been hacked resulting in people losing a substantial amount of holdings.

The versatility of fiat money, on the other hand, means it can be stored in various forms. For instance, there are payment providers such as PayPal that allow people to store fiat money in digital form. Banks also do act as custodian of hard currencies. Cryptocurrencies and fiat money come with attributes that make them stand out as a means of legal tender regardless of jurisdiction. However, they also come with cons that have seen them continue to divide opinion around the world.

While there are many advantages of cryptocurrencies over fiat money, it seems that cryptocurrencies are not yet mature to replace the current standard payment method. It is a matter of time and not necessarily will be in the form of Bitcoin, Ethereum or any other cryptocurrency. The crypto market will most likely evolve to create a positive product that might change the current money system.

Sybil Attack

Sybil Attack is a type of breach seen in peer-to-peer systems in which a node in the grid operates multiple identities vigorously at the same time and weakens the authority in reputation systems. The focal purpose of this attack is to gain the middle-of-the-road influence in the network to carry out illicit this is with respect to guidelines and regulations set with in the network actions in the system. A single entity- a computer system has the ability to produce and activate multiple identities. To outside viewers, these numerous fake identities seem to be real inimitable identities.

This attack receives its name form a case study about a woman named Sybil Dorsett, who was treated for Dissociative Identity Disorder. If you are interested in understanding more about this particular case, we suggest that you watch the movie based on the same- “Sybil” (2007). A paper called The Sybil Attack was written by John R. Douceur at the Microsoft Research.

How the Bitcoin network prevents sybil attack?

Bitcoin grid uses the Proof of Work (PoW) consensus algorithm to prove the legitimacy of any block that is added to the blockchain. A substantial amount of computing power is essential to do the work which delivers imbursement motivation to the miners to do authentic work which means a bitcoin reward of 12.5 bitcoins for every block mined is given to the miners and no incentive for the defective work. The dealings are authenticated by every node and vetoed as inacceptable if defective transactions are included in the block. A type of sybil attack, called the 51% attack is also virtually impossible in the bitcoin system because of so many miners, it is very tough for a single group to control 51% of the miners.

Ways to prevent sybil attack

Giving different power to different members – This is on the basis of repute systems. Members with dissimilar power levels are given diverse reputation levels.

Cost to create an identity – To avert multiple false identities in the network, we can put a cost for every identity that aims to join the network. A point to note is that it makes more sense to make it infeasible to operate multiple fake identities at the same time rather than creating new identities. Multiple identities can enforce security, anonymity, censorship prevention.

Validation of identities before joining the network –

Direct validation: An already recognized member authenticates the new joiner of the network.

Indirect validation:An established member authenticates some other members who can, in turn, verify other new network joiners. As the members authenticating the new joiners are verified and validated by an established entity, the new joiners are trusted to be honest.

Social Engineering in Cryptoeconomics

This blog is a continuation of the previous blog that introduces the act of social engineering. It would be wise to read that blog before we can go ahead and explain how social engineering works in cryptoeconomics.

Phishing for Bitcoins

Social engineering attackers are also targeting cryptocurrency.

Researchers at Cisco’s Talos security group have identified a malicious advertising campaign they dub Coinhoarder, which appears to be based out of Ukraine and to have netted about $50 million in the past three years, including $10 million alone in the last three months of 2017.

For this campaign, which began last February, the researchers say attackers purchased Google Adwords to “poison user search results” and direct them to attacker-controlled phishing sites designed to separate them from their cryptocurrency.

“Cisco identified an attack pattern in which the threat actors behind the operation would establish a ‘gateway’ phishing link that would appear in search results among Google Ads,” the Cisco Talos researchers say. “When searching for crypto-related keywords such as ‘blockchain’ or ‘bitcoin wallet,’ the spoofed links would appear at the top of search results. When clicked, the link would redirect to a ‘lander’ page and serve phishing content in the native language of the geographic region of the victim’s IP address.”

At one-point last February, Cisco reports that DNS queries for the gang’s fake cryptocurrency sites exceeded 200,000 queries per hour. A significant number of them came from Nigeria, Ghana and Estonia, leading researchers to suggest that attackers were attempt “to target potential victims’ African countries and other developing nations where banking can be more difficult, and local currencies much more unstable compared to the digital asset.”

Cisco says it’s been sharing intelligence on the operation with Cyberpolice Ukraine.

DNS queries for “block-clain.info” domain. (Source: Cisco Talos)

Many of the phishing sites use real-looking but fake domain names – referred to as “typosquatting” or brand spoofing – for example featuring a word such as “blockclain” – instead of “blockchain” – in the URL, Cisco says. Such typos could be especially effective on users whose first language is not English or for anyone who’s using a mobile device, researchers say.

More recently, Cisco Talos reports that attackers have been refining their campaign by making their phishing sites look more legitimate. “A few months after we began tracking this particular group, we observed them starting to use SSL certs issued by Cloudflare and Let’s Encrypt,” the researchers say. “SSL certificate abuse has been a rising trend among phishing campaigns in general.” (DarknetVendors Sell Counterfeit TLS Certificates).

This is simply an example of how social engineering can be used to in the realm of cryptoeconomics to embezzle people of their digital assets. It is advised that you do not participate in activities that seem malicious.

The Future is Now with XcelToken Plus

Recently, the CEO of XcelLab Gyanendra Khadka has announced the release of the upgraded version of the popular XcelToken, with the aim of changing the ecosystem of utility tokens around the world.

“XcelToken Plus” is the upgraded version of XcelToken, which is an ERC20 token on the Ethereum Blockchain Platform, that is painstakingly crafted with the purpose of driving mass adoption of crypto in the mainstream industries at touch our lives, building and fostering a large crypto-community within the hospitality, retail and gaming sectors. For example, travel industry alone is worth over $7 trillion and is growing at over 11% per annum.

XcelLab is proud to announce that XcelToken Plus is now available for trading on 14 well reputed exchange platforms under the ticker name XLAB.

Here’s a list of platforms that one can now use to trade the utility token- XcelToken Plus (XLAB) on:

ABCC – A world-class Digital Assets Exchange, aiming to provide a frictionless, user-centric trading experience.

LIVECOIN – A modern, safe trading platform for accessing cryptocurrency exchange markets with simple interface and low trading fees.

P2PB2B – An advanced cryptocurrency exchange that works for the benefit of its users.

MERCATOX – A modern convenient service for accessing e-currency and cryptocurrency exchange markets.

HOTBIT – A professional digital asset exchange platforms that provide trading services among major digital currencies like Bitcoin, Litecoin and Ethereum for users from all over the world.

LATOKEN – A rapidly growing crypto exchange focusing on liquidity for new tokens.

BITKER – Provides hundreds of trading pairs for global users, safe and easy to use, convenient and reliable digital asset exchange.

COINGEO – Fast, Secure and reliable, make the platform a complete station for traders. XcelToken Plus is a preferred token on this Exchange platform.

PACTBIT: Is a system that allows you to trade at home or office and on Windows-based program provides a secure and Convenient interface.

HIBIT: Financial Security, Asset Separation, 2-Factor Authentication

ECOINEX: A system for protecting your assets with security and transparency.

WEBITRX: Strives to keep your assets grow in security and transparency.

WEBITRXHK: is a system that allows you to trade at your convenience, while providing security and transparency.

BORABIT: Low fees, Strong Trading Aids and Coin Price Comparison by Exchange.

Mr Khadka (CEO) stated that “The utility token; XcelToken Plus, will enable the crypto community to use the token in their day to day transactions, such as mobile recharge, travel and retail – few of the most important spheres that touches our lives on an everyday basis. So, having a token that allows you to transact in these spheres will enable cryptocurrencies to enter the realm of mainstream adoptions in a faster pace.”

Further to his previous statement Mr Khadka, added “… we have a team of dedicated senior developers across USA, Mexico, Nepal, India and Singapore, who are working to ensure, the token and the platforms are built keeping in mind world class standards, to make sure that the crypto-travellers and traders receive best services and offers” And this he says “will help increase the possibility of growing the cryptocurrency community and stabilizing the significance of utility tokens.”

XcelToken Plus, a one of a kind utility token, aside from its tradability, is now adopted into usage on platforms such as:

XcelTrip– An online travel booking platform based on the blockchain technology, aims to disrupt the ever-growing trillion-dollar travel industry, through challenging the monopoly of the ecosystem by giving the power back to the users. XcelTrip, allows travellers to check-in at over 800,000 hotels and book tickets with over 400 airlines. XcelTrip makes sure to give the power of bookings and anonymity to the consumer, the consumer is exempt from paying extra credit card charges and other miscellaneous expenditures.

On this decentralised travel platform, aside from XcelToken Plus, crypto-travellers can also use Ethereum, Bitcoin, Binance coin to book airline tickets and hotels.

Crypto-travellers around the world can either log on to XcelTrip.com or download the XcelTrip app, available on both android and IOS, to book their travels, with amazing cashback offers that run all throughout the year and for those travellers who contribute content and inventory there is a proposition that allows them to earn XcelToken Plus on the XcelTrip platform.

Mr. Raghav, XcelTrip CMO adds “ Crypto community can now book over 800,000 hotels and 400 airlines on XcelTrip.com and earn up to 50% cash back on their booking, this is an offer that is sure to disrupt the travel industry, we are passing on massive benefits to users and community, to kick-start the crypto mass adoption in travel industry. Further, users can use our XcelPay platform for mobile top-up and purchase gift cards from top brands such as amazon, Walmart, target, uber and more.”

XcelPay– A merchant POS, digital payment wallet and crypto payment gateway. XcelPay is integrated into an easy to use, crypto wallet that is enabled for both mobile and tablet use, makes sure that sending and receiving payments in crypto is a secure process.

XcelPay aims to cut out unwanted middle men, bank/card transaction fees, currency conversion fees that produce a damaging effect on the retailer’s and consumer’s margins, making this a shopaholic’s ultimate companion.

Through XcelPay, the users can now top up their mobile phone plans with 900 different carrier services and in 160 countries, with Ethereum and XcelToken Plus.

XcelToken Plus is also a preferred token on Bitnare, a social media platform that allows for the people of the crypto-community to network with each other within the community with a lot of comfort. XcelGames, where the player can collect coins on the game and convert them into XcelToken Plus. The app is available for both IOS and Android devices.

Understanding Liquidity

The concept of liquidity has many facades to it. One way to define liquidity is “the ability of an asset to be converted into cash readily on demand”. An additional way of viewing at it is when any asset can be bought or sold at its fair price. Liquidity thus means that there aren’t discounts or bonuses devoted to it during buy or sell and it’s easy to enter and exit the asset. It is believed as more of an item is accepted and sold, the chances of charging premiums or giving discounts lower and such an asset usually trades around ‘what it is worth’.

The forex market is often defined as a liquid market with an average turnover of more than $5 trillion daily as of April 2016 according to the Bank for International Settlements (BIS) while real estate is a classic example of an illiquid asset. Property as an asset is less liquid, requiring huge investments into physical form, monotonous procedures and smaller market.

Liquidity is significant for any tradable asset, which comprises the math-based currency Bitcoins as well. Liquid markets are deeper and smoother while illiquid market can put traders in a spot from where it’s hard to circumnavigate the way out. Bitcoins have seen a significant grown in the last five years of its existence from 50 Bitcoins in 2009; the circulation is more than 16.78 million today. The graph above depicts the growth of Bitcoins in terms of circulation. However, the virtual currency has viewed episodes of illiquidity. Let’s take a look at the main factors which influence the liquidity of the Bitcoins.

How to tell if a market is liquid

There are three significant indicators that can help determine if a market is liquid or illiquid: 24-hour trading volume, order book depth, and the bid-ask spread. the bid-ask spread is the difference between the lowest ask price and the highest bid price.

However, the order book might not always be an accurate representation due to factors like stop-limit orders and iceberg orders, which are not always visible in the order book. Liquidity is extremely important when considering your trades. It is one key factor for easily entering or exiting a particular market.