Cardano Community Digest - 12 December 2022

Welcome to the Cardano Community Digest!

Published by the Cardano community team every two weeks, this Digest will provide you with news, updates and events about the project and ecosystem!

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Focal points of the week

Catalyst Circle v4 Elections

We are halfway through the long-awaited Catalyst Circle v4 elections that started on December 06th, 2022, at 21:45 UTC. Voting will be possible until December 16th, 2022, at 21:45 UTC. The on-chain voting process will be handled by the DripDropz team. Community members can vote on who of the +30 nominees will fill the five available community seats, representing various needs, ideas, and visions from the Cardano & Catalyst Community.

The vote will be token-weighted based on the amount of ada per wallet. Voting power was recorded via a snapshot taken of all Cardano wallets at the end of epoch 379. Every wallet containing at least 5 ada is eligible to participate. To better understand the role of the catalyst circle and its representatives, we highly recommend reading this forum post written by Cardano Ambassador Felix Weber.

Make your voice heard and vote today by visiting DripDropz.io – Cardano Token Distribution System

“Real change, enduring change, happens one step at a time.” - Ruth Bader Ginsburg

Lace lite wallet is now in Pre-production

To celebrate Ada Lovelace’s birthday on December 10th, IOG has released a Testnet version of the Lace.io light wallet. This version can be downloaded from the Google Chrome webstore.

Since it is currently being tested in a pre-production environment, IOG is inviting the community to help test the wallet and report any bugs found. This will allow their developers to issue fixes and improve the experience for Mainnet use.

A ticket can be raised to the service desk in the event any bugs are found:

https://iohk.zendesk.com/hc/en-us/requests/new

There is also a dedicated Discord channel available:

For an overview of FAQs please visit the following link: Frequently Asked Questions | Lace

For testing purposes, test ADA can be obtained here:

https://docs.cardano.org/cardano-testnet/tools/faucet

Minswaps ordering process was exploited

On December 08, 2022, Twitter user @CryptoVincenzio publicly flagged that it appears a malicious actor is front running orders on Minswap and making profits off of this behavior.

In short, front running trading means that an investor buys or sells an asset based on advance, non-public knowledge or information that they believe will affect its price. That information is not yet public, giving the trader an advantage over other traders, and the market at large (Source).

Shortly after CryptoVIncenzio reported this issue, the Minswap team responded and ensured that they are investigating what part of their system failed to protect against this exploit. A few hours later, the Minswap Twitter account announced that the issue had been fixed and a detailed incident report would be published in the next few days. As promised, on December 10th, 2022, Minswap Labs published the thorough incident report.

To keep it simple, the attacker exploited the ordering process of the batching used by Minswap, specifically the TX hashes within the same bach. Before the attack, the orders within a batch were executed by the default ordering of ledger inputs (lexicographically).

The off-chain ordering process ordered transactions by their TX hash in ascending order. The attacker monitored Cardano’s mempools, having access to information about transactions before they got on-chain, and then used this information to create transactions with a smaller TX hash that would then be prioritized by the batching software.

The Minswap team solved this by changing the logic of the off-chain batching algorithm.

Arbitrage Trading Bot on Cardano

It appears that an arbitrage trading bot has recently been detected on the Cardano network, according to Taptools. This type of activity is typically seen on other L1 networks, but not yet on Cardano.

Arbitrage trading is a strategy that involves taking advantage of small differences in the price of an asset in two or more markets. The trader buys the asset in one market and sells it in the other, pocketing the difference in prices as profit. How does this work? Let’s go through a simple example: Token A is tradeable on Minswap and SundaeSwap, but the price of the token is different on each platform. On Minswap token A is worth 1 ada and on SundaeSwap 1.1 ada. The arbitrage bot is now buying token A on Minswap for 1 ada and sells it for profit on SundaeSwap for 1.1 ada. This type of trading helps to correct pricing inefficiencies and increases liquidity in the market, making it an important part of any financial system.

Investopedia states that arbitrage trading is important for any financial system because it helps to narrow the price differences between identical or similar assets. By buying and selling these assets, arbitrage traders cause lower-priced assets to be bid up and higher-priced assets to be sold off, leading to more efficient pricing. This practice also helps to encrease liquidity in the market.

Japanese regional revitalization through CNFTs

To help revitalize the city of Yoshinogawa and spur forth the growth of one of its most well-known products, plum wine, the city has partnered with @kabukitokyo_ada, who are known in the community as a new Japanese-led anime project aiming to bring art & utility to the CNFT community!

Through this partnership, the city will utilize Kabuki Tokyo’s IP on the branding of their products and marketing materials, enabling holders of Kabuki Tokyo’s CNFTs to get special discounts.

The production source of the plum wine can also be authenticated and traced on the Cardano blockchain via the NFT, and the art makes for a perfect gift for anime and manga fans the world-over.

Private tourism association @kittamu0, is also leading the charge on the partnership front, establishing themselves at large blockchain industry events within Japan to promote and educate the Japanese public on Cardano, Yoshinogawa City, and Kabuki Tokyo. The goal is to ultimately attract and onboard famous Japanese anime artists to the Cardano blockchain and to one day be able to produce an anime.

This is another example of the exciting and creative ways the Japanese Cardano community have continued to foster growth and education within the Cardano ecosystem and we can’t wait to see how this continues to grow in the future.

We’d also like to give a special thanks to @AdaLegend626 and @kongsynft for writing great threads on this topic here and here.

Other Cardano related News

  • We are pleased to announce that the Summit sessions are now available on the Foundation’s YouTube channel. You can now watch and rewatch the sessions at your leisure to learn more about the latest developments and announcements that were shared during the Summit. We hope you enjoy the sessions and find them informative. Source

  • At the recent Summit, we were pleased to see speakers and attendees discuss the potential benefits and challenges of using decentralized technology to enhance financial systems. A secure and decentralized technology that is compliant with regulatory expectations has the potential to improve existing finance systems, particularly when equipped with a core infrastructure that is not only resilient and scalable, but also built with sustainability in mind.

However, for blockchain solutions to truly optimize current financial systems and build robust applications for the future, it is important for a wide range of perspectives to be considered. The Cardano Foundation believes that engaging in open and inclusive discussions about the role of decentralization in financial services can help to drive progress and innovation in this area. Source

  • The Fintech Times’ look back at the Summit and interview with Frederik Gregaard. Source

Recap Cardano Summit 2022 - SPO Breakout Room

During the Cardano Summit 2022, the Cardano Foundation held five special workshops - with each workshop hosting one or more sessions on different topics.

For the workshop “Mastering the SPO Challenges”, we had several Stake Pool Operators and industry experts provide presentations on topics such as:

  • How to Effectively Market a Stake Pool - by This is Red Flag
  • CIP procedure and how SPOs can help optimize the network - by Matthias Benkort
  • The effect of consensus design on health of permissionless blockchains - by University of Zurich
  • Crypto Regulations - by Martin Hess (renowned Financial Markets Lawyer, specialised in DLT within Switzerland)
  • Germany Tax Tool Experience and Legal and Security Best Practice for Pledge - by Chris Kulas
  • Network Monitoring & Performance - Markus Guflar

Because this breakout room was a clear standout success, with consistently high attendance and engagement, we have posted a full summary of the event on the Cardano Forum. To read the full summary, please click here.

Cardano Reddit Top 10 Most Engaged Topics

Below are the most engaging topics on Reddit

Cardano Forum Top 10 Top Referred Topics

Topics that have received the most clicks from external sources. (last 10 Days)

Topic Clicks

Cardano Blockchain insights

Utility token

A digital token that holds certain functionality in regard to a concrete project or environment. These tokens can be used as payment units, rewards, or grant access to a specific network.

Recently held Meetups

Other meetups around the world:

  • 28-29 September 2022 Token 2049 After Party: Cardano Pool Party in Singapore! More info
  • 29 September 2022 LATAM Community September Recap. More info
  • 8-9 October 2022 CNFT Con in Las Vegas. More info
  • 14-15 October 2022 Rare Bloom event at the Gaylord Rockies, Colorado. More info
  • 18-19 November 2022 O ScotFest: the age of Voltaire More info
  • 19 November 2022 Cardano Summit 2022 Kick-Off Community Event Berlin More info
  • 19 November 2022 Cardano Summit 2022 Miami Event. More info
  • 20 November 2022 Cardano summit 2022 Vancouver More info
  • 19-21 November 2022 Cardano Summit 2022. More info

Recently held Ambassador Calls

  • 2 November 2022 Open Moderator Call
  • 9 November 2022 Open Meetup Organizer Call
  • 9 November 2022 Open Content Creator Call
  • 10 November 2022 Special: Ambassador Call - Cardano Summit 2022
  • 17 November 2022 Monthly Ambassador Call
  • 23 November 2022 Open Translator Call
  • 30 November 2022 Open Content Creator Call
  • 30 November 2022 Open Meetup Organizer Call

Bi-weekly CIP editor Meeting on Discord

Are you interested in attending CIP editor meetings? Join the Discord channel to learn more about this interesting community where ideas and recommended changes are all discussed.

Cardano Wiki

Explaining Cardano’s eUTXO model for a five-year-old

Cardano is fundamentally different from Ethereum in its accounting model. While Cardano uses the extended UTXO model (eUTXO), Ethereum uses accounts. In this article, we will explain the difference between these approaches in a simplified way.

Accounting model

You can think of a blockchain as a ledger, a history of accounting records written by an accountant. The ledger is open, so all the records can be viewed by all the accountants, but also by all the users at any time. The accountants will represent the network in our analogy. Imagine accountants sitting in a bank and being approached by clients (users) who ask them to make accounting entries (transactions). All the accountants share one ledger that they use for accounting entries.

In blockchain networks, users own the coins. Even if the records are in a ledger, when users come to the accountant with a request to change a record, they have to confirm it with a thumbprint (analogy to a digital signature of a transaction). Imagine ADA and ETH coins as pieces of paper that users put into a wooden box (wallets). The pieces of paper are physically in the ledger and together they form the individual pages of the ledger, but thanks to the box, users can look at them and hand them to the accountant if they ask to make a change to a record (send a transaction).

Cardano and Ethereum differ in how the ledger entries are written, hence how clients hold the coins.

Cardano works with ADA coins similarly to banknotes, except that the denomination can be any value. For example, 12 ADA, 3.5 ADA, and 0.3 ADA. The user has 3 pieces of paper in his box with these values written on them (he has 3 UTXOs). That’s a total of 15.8 ADA. Unlike Ethereum, Cardano has the added capability that there can be multiple smaller boxes in the box that contain individual pieces of paper (the smaller boxes represent blockchain addresses). There can be more pieces of paper in one smaller box.

If Alice wanted to send 14 ADA to Bob, she would have to give the accountant 2 pieces of paper with 12 ADA and 3.5 ADA. The accountant would create a new piece of paper (a new UTXO) and write 14 ADA on it. He would put this piece of paper in Bob’s box. Next, he would create another new piece of paper with a value of 1.5 ADA, which he would return to Alice’s box.

To read the ful article, click > cardanians.io

Cardano Summit 2022 in Buenos Aires

The Cardano Summit 2022 in Buenos Aires, organized by ADA Solar, Apolo Stake Pool, and Latin Stake Pools, was a huge success, with over 120 attendees enjoying great drinks, sushi, music, and company from the community. The event took place in the upscale neighborhood of Puerto Madero and featured a talk by renowned intellectual Naum Kliksberg on universal basic income. Attendees were also able to take home a 360° video featuring the five eras of Cardano as a souvenir. https://twitter.com/CardanoSolar/status/1597007998458941440

Text featured by Cardano Ambassador Martin Ungar

Spotlight for Community-built Tools

The Developer Portal was created to foster a home for developers who are dedicated to building tools and services on Cardano. The platform allows developers to not only collaborate on projects but also to showcase their works.

The Developer Portal aspires to become a credible source where users can search for tools to fit their needs.

Community projects already running on mainnet are encouraged to add their projects to the Developer Portal.

  • Shareslake The stable branch of Cardano. A fiat-backed stablecoin for Cardano mainnet and a whole Cardano network running as a sidechain by the fiat-backed stablecoin instead of ADA. Deploy dApps out of the box and use Cardano technology like if you were using US dollars.
  • TapTools All-in-one platform that offers free token distribution, comprehensive charts, NFT generation, and mint facilitation.
  • Carda Station Explore this virtual world on the moon with an in game avatar, and interact with other players through hangouts, games or events.
  • Voteaire allows everyone in the ecosystem to create a poll. All results are weighted. All proposals and votes are stored publicly on-chain.

Network insights

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