Cardano Daily Discussion - January 07, 2023

Hello everyone,

Welcome to the Cardano Daily Discussion!

The standard sub rules apply here (see sidebar), with the exception that price discussion is allowed in this thread, though we encourage you to try not to make this the focus and talk about the project itself. Please ask questions, help others and be civil - be sure to get involved in Project Catalyst too!

If you're new, please make sure you're read through the newbies guide and share it with others (use the ?newbies comment command to reference it).

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⚠️ Scam Warning ⚠️

Please read the Cybersecurity guidelines for Cardano Users.

There are ongoing giveaway scams on youtube and many scammers lurking in Cardano's social channels impersonating ambassadors/moderators/official staff contacting users via direct messages.

For example, searching 'cardano' on youtube and sorting by most recent upload date shows several giveaway scams running (all videos in screenshot are scams):

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Ongoing 'giveaway' scams on Youtube

The youtube scams are automated; use stolen footage usually of Charles Hoskinson and are restreamed so to appear to be 'live'; appear to have many watchers (which are bots); use bought hacked channels and are edited to appear like official channels.

Do not be fooled!

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To be clear:

• ⚠️ There is no such thing as a Cardano giveaway
• ⚠️ Never share your seed phrase with ANYONE
• ⚠️ Never send ADA to someone promising to send you more ADA back
• ⚠️ You will never be contacted by ambassadors/moderators/staff

Please report scams on the Cardano Fraud Detection Bureau.

⚠️ Scam Warning ⚠️

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Midnight Subreddit

In anticipation of Input Output's new data protection blockchain 'Midnight', I've managed to acquire r/Midnight through some negotiation and repurpose it for the Cardano Community (the sub was created for a card game back in 2011 but was mostly unused).

I decided to do this as I thought the project will eventually need a home on reddit and best to setup now before any scammers do. Obviously there's not much to post about on there right now as it's early days as the project is yet to be released, but if you'd like to be kept up to date on the project please feel free to join the new subreddit if the project interests you and I'll be sure to post updates as and when they become available.

Right now the sub is mostly a carbon copy of r/cardano, I've copied most of the automod and rules over, so certain aspects may seem a little incongruent atm, but I'll tailor and tweak the sub as we go. Feel free to send me or post any input if you want stuff to change.

Cheers all

Taiwan is rushing to build its own analogue of Starlink.

After studying the experience of using Starlink satellite terminals in various emergency situations, the Taiwan authorities decided to create their own satellite constellation. It can be used for both civil and military purposes. So far, the island authorities are negotiating with several local and international investors to raise funds for the project. Local aerospace agency TASA intends to spin off its existing satellite division into a separate company.

According to TASA, the agency intends to implement a project to launch low-orbit satellites into space, the government intends to retain a minority but significant stake in the company being created. Representatives of the Taiwanese authorities stressed that, among other things, they are studying the experience of using Starlink satellite terminals in other regions of the world in the event that the regular Internet is turned off, which will provide access to communications not only to the public, but also to journalists and authorities in an emergency... Detail: https://bitcoingrandee.com/posts/106 NEWS u/Cryptocurrency u/Mining u/Cloudmining u/Bytecoin u/Bitcoin u/Dogecoin u/Blockchain u/Business u/News u/Starlink u/Taiwan u/TASA u/China u/USA u/DraperAssociates u/SpaceX u/Tesla u/Japan u/SouthKorea u/Australia u/TronFutureTech u/Rapidtek

https://preview.redd.it/njr3obnkjeaa1.jpg?width=750&format=pjpg&auto=webp&s=e2393e8d786056f01c8eedf36b394b7b478d85f0

BTC prices arent plummeting atm because most actual crypto trading volume occurs off the open market via Over-The-Counter trading desks. Large trades are being made at big discounts without affecting the public price….Silvergate Bank is the key to this, and it’s in big trouble.

I’ve posted about this before but it bears repeating given recent events and lots of people asking why the price isn’t crashing instantly below $16,500

The crypto exchange volume and prices we see quoted are not real. They’re a fabrication of automated bots trading back and forth and flashy UI.

The vast majority of actual crypto trading volume occurs behind closed curtains, via OTC trading desks (https://finance.yahoo.com/news/otc-much-larger-bitcoin-exchange-212305761.html ). All of the big exchanges have OTC trading arms.

Say you want to sell 1000 bitcoin. You don’t log into your basic Coinbase account and dump it all with a spot trade….you’d tank the market and make way less than you wanted. Instead, you contact Coinbase’s OTC desk. They then “look around” their network of institutional investors and big money traders to find an interested buyer. The buyer (often a market maker firm) offers a single price they’re willing to pay for the entire lot of 1000, and if the seller accepts the trade is executed. Exchange takes a commission.

These OTC trades do not have any immediate impact on the spot price (unless the crypto buyer decides to dump their purchase on the open market).

When the market tanked throughout 2022 in the wake of Celsius, Terra, FTX etc, almost all real retail trade volume was essentially wiped out. So over the last couple months, the public exchange price isn’t moving much because all but the most die-hard cult members have mostly already sold. But there are still big players holding some huge bags of their magic money.

Given the extreme dip in demand, right now OTC trades are happening behind closed curtains likely at massive discounts. As these institutional crypto firms unwind and liquidate in the carnage, Bitcoin/other crypto could be changing hands for 20-30% less than spot and wed have no idea.

But here’s where it all gets dirty…

Within the US, almost all of this OTC trading is facilitated by 2 banks…Silvergate and Signature.

Silvergate’s main line of business is offering an inter-connected payment network for major crypto companies. They provide an on-ramp/off-ramp for fiat, and enable instant money transfers between the 1600 institutional crypto firms who are part of the network.

Their SEN payment network is what provides the fiat liquidity that enables these big OTC trades to happen.

But as we learned today, Silvergate’s crypto deposits have been decimated to the tune of $8 billion. This includes all the fiat money used as liquidity for OTC trading.

Without Silvergate and Signature, big money cannot move quickly, and the OTC trading cartel breaks.

If Silvergate goes down, whales looking to cash out big stacks quickly will need to either rely on the open market. Thats when you’ll see the price really tank.

TL;DR - Silvergate and Signature Bank are the glue enabling most of the off-market trading in the US. Without them, everything goes boom very fast