The entire trend of human history is centralization. We should be wary of painting it as a panacea and be mindful of use cases where crypto is working more efficiently. The USP of crypto is reduction of counter-party risk and that is bullish for a world with ever-decreasing levels of trust (vertically and laterally).
Jan 18, 2022·edited Jan 18, 2022Liked by BowTied Bull
USDT is an "ERC20" token on Ethereum, all tokens are a piece of code (a smart contract) that define the token (e.g. Token Name, symbol, number of decimals), functions/operations available (e.g. transfer from one address to another) and also stores the token balance each address holds.
Balances are determined by calling the balanceOf operation on the contract which takes an address "0x123ABC" and returns the token balance.
Transfers are done by calling the transfer operation which takes the the amount of tokens to send, an address to send them to and uses the address of the wallet interacting with the contract to send them from. When called it will then reduce the balance of the from address and increase the balance of the to address (after some validations).
The USDT contract also contains a blacklist function that 'admins' can call to block a given address. When a blacklisted address tries to send tokens the transfer operation would be called and validate that the address isn't blacklist. If it is then the transfer will fail, meaning the tokens are locked.
It doesn't look like wBTC has a blacklist function in the contract. It does have a pause function which can stop any further transactions taking place (e.g. in the event of a hack) but these type of functions are quite normal.
Every token on the Ethereum chain is represented by a contract. All logic related to the token is coded into the contract, e.g. whether it has a fixed supply or new tokens can be minted, whether there is a tax in buying/selling, whether there is a transaction size limit, whether certain addresses are not allowed to trade the token (this usually takes the form of a blacklist where whitelisted addresses can freely add addresses to at any time). So the contract for USDT has a blacklist function, which allows the company behind Tether to freely "freeze" USDT on certain addresses.
They are able to blacklist addresses which causes all token transactions of Tether to fail to and from the address. I'm not entirely sure of how that works, but it essentially locks whatever Tether is in that wallet in place.
That may solve the problem with tokens specifically but isn't entirely the point. You would still want to interact with other services & smart contracts (e.g. DEXs) which may be maintained and controlled by central entities leading to similar scenarios.
"Conclusion for Newbies: If you own any “crypto currency” check to see if it is centralized and how it is run. If you acquire Wrapped ETH or Wrapped BTC and are worried about potentially losing it, you should immediately go to standard BTC/ETH. This reduces your risk."
Woa damn never knew risk like these existed. Thanks Bull!
15% - 2 months poorer anon. http://www.shadowstats.com/alternate_data/inflation-charts.
Please make yourself a favor and read this breakdown of the mother of rug pulls: http://www.shadowstats.com/article/no-438-public-comment-on-inflation-measurement
Ser, I think you meant USDT lock up, not UST.
UST is a ‘decentralized’ alto stablecoin of the Terra ecosystem.
Yep typo fixing thx!
Sounds like you know more about the latest COVID outbreak than most public health people.
Definitely do not! Just looking at published numbers and we are not health experts
Wasn't meant as snark.
The public health people don't seem to be looking at the numbers, based on their decisions. Clowns abound.
The entire trend of human history is centralization. We should be wary of painting it as a panacea and be mindful of use cases where crypto is working more efficiently. The USP of crypto is reduction of counter-party risk and that is bullish for a world with ever-decreasing levels of trust (vertically and laterally).
Anyone technical able to give a breakdown of how USDT just gets “locked up”? I thought it was on Efferium which is mostly decentralized?
USDT is an "ERC20" token on Ethereum, all tokens are a piece of code (a smart contract) that define the token (e.g. Token Name, symbol, number of decimals), functions/operations available (e.g. transfer from one address to another) and also stores the token balance each address holds.
Balances are determined by calling the balanceOf operation on the contract which takes an address "0x123ABC" and returns the token balance.
Transfers are done by calling the transfer operation which takes the the amount of tokens to send, an address to send them to and uses the address of the wallet interacting with the contract to send them from. When called it will then reduce the balance of the from address and increase the balance of the to address (after some validations).
The USDT contract also contains a blacklist function that 'admins' can call to block a given address. When a blacklisted address tries to send tokens the transfer operation would be called and validate that the address isn't blacklist. If it is then the transfer will fail, meaning the tokens are locked.
You can see the contract here:
https://etherscan.io/address/0xdac17f958d2ee523a2206206994597c13d831ec7#code
Thanks Mike, does this same blacklist feature exist for wBTC? I believe so given how much caution BTB warns us about using it.
It doesn't look like wBTC has a blacklist function in the contract. It does have a pause function which can stop any further transactions taking place (e.g. in the event of a hack) but these type of functions are quite normal.
https://etherscan.io/token/0x2260fac5e5542a773aa44fbcfedf7c193bc2c599#writeContract
https://www.reddit.com/r/ethtrader/comments/hp9dam/comment/g0jipfg/?utm_source=share&utm_medium=web2x&context=3
woa thanks dude. I never knew how risky this was.....
Every token on the Ethereum chain is represented by a contract. All logic related to the token is coded into the contract, e.g. whether it has a fixed supply or new tokens can be minted, whether there is a tax in buying/selling, whether there is a transaction size limit, whether certain addresses are not allowed to trade the token (this usually takes the form of a blacklist where whitelisted addresses can freely add addresses to at any time). So the contract for USDT has a blacklist function, which allows the company behind Tether to freely "freeze" USDT on certain addresses.
https://www.yahoo.com/now/tether-blocks-160-million-usdt-152718550.html
They are able to blacklist addresses which causes all token transactions of Tether to fail to and from the address. I'm not entirely sure of how that works, but it essentially locks whatever Tether is in that wallet in place.
That may solve the problem with tokens specifically but isn't entirely the point. You would still want to interact with other services & smart contracts (e.g. DEXs) which may be maintained and controlled by central entities leading to similar scenarios.
"Conclusion for Newbies: If you own any “crypto currency” check to see if it is centralized and how it is run. If you acquire Wrapped ETH or Wrapped BTC and are worried about potentially losing it, you should immediately go to standard BTC/ETH. This reduces your risk."
Woa damn never knew risk like these existed. Thanks Bull!