What is split coin (the principle of making money through split mode)

What is a split coin. In the blockchain industry, projects with the theme of “currency reform” often appear. This is a method of splitting tokens into different parts and forking them – achieving more effective interoperability by splitting the original code and chain When we talk about blockchain, we need to first understand what currency reform is. In the field of Cryptocurrency, the most common word is “splitting”. The concept of distinguishing the main network of one project from the main network of another project (Bitcoin) is called ‘reorg’ In a sense, “splitting” means allowing two teams to jointly develop new things according to their own wishes, which can achieve mutually reinforcing functions. But there may be some problems during this process: firstly, the project team does not have enough time to study how to redeploy the product; The second project party is unable to continue operating due to a lack of financial support; The third project party is unwilling to take on corresponding responsibilities due to insufficient cash flow support, which makes the entire ecosystem more fragile and risky. So the so-called “splitting” here actually refers to the process of converting multiple protocols within the same time period. Therefore, for most people, splitting does not necessarily mean that any new assets will change However, this situation may not be as interesting and difficult to understand as many ICOs. For example, “I just wanted to start as an exchange and then use other exchanges for platform trading”, or “I now feel like I can directly issue coins”, and there is also a saying that this is a capital market game In this case, a situation similar to an IPO will arise So, why does this phenomenon occur? Simply put, the main reason for this is that there is not much difference between the two. Question after “splitting”:

1) Does the project agree to retain 5% of the original 1% share of the total issuance amount to third-party investors Is it necessary for the company to retain a portion of its shares or hold them as future shareholders Do the founders recognize their equity or ownership of the company. These are all determined by individuals Can the foundation obtain a certain proportion of shares/shares and other information? Of course, it may be the interests of private stakeholders. On the other hand, in order to improve efficiency and reduce costs, many projects have chosen to publicly promote the number of tokens they already have to the public This resulted in a result: although some early users wanted to participate, they did not want to be their customers and were unable to fulfill their promises, leading to projects such as Aave, Compound, Dharma, dYdX, and MakerDAO These two types of projects are built on the same infrastructure and both have very high liquidity and depth, making them susceptible to drastic price fluctuations, especially those in the early bear market stage. In other words, they may face various challenges

The principle of making money through split mode

Editor’s note: This article is from William Chatter (ID: William1913), written by William Chen, and reprinted by the Daily Planet with authorization One of the most famous concepts in the world of Bitcoin and blockchain is’ splitting ‘. This concept was first proposed in 2017, when people believed it was highly likely to become the future of the digital currency industry. But in fact, this model is not suitable for everyone. Because this is a new type of financial product or investment method, and its emergence has sparked a strong interest and attention among many people towards digital assets However, the current situation is different. When you study a certain project, you will find that many projects have already started various innovations, attempts, and even failures. So the success of these projects all stems from one fact, which is that they not only focus on coin circles, but also prefer to transfer funds from other places in order to truly gain profits and value, and then make money. What if you want to participate? It depends on whether their project has sufficient market size to achieve their goals and make profits So we need to understand the principle of splitting:

Splitting refers to dividing existing tokens into several parts through different markets, resulting in a new block header. The size of each block header depends on the data processed by each node in the entire network. For example, there are currently some projects on the market that use multiple transaction ledger systems on a single platform. And these transaction books are kept by some centralized institutions. That is to say, users can only store a specific encrypted dataset in one wallet. Therefore, once someone adds multiple addresses to the same exchange, all operations can be completed. Due to the long trading time, people may be more concerned about the safety of the same contract. For example, if the price of a pancake exceeds 50000 yuan, it may cause a large number of investors to lose funds or be forced to sell other varieties, which is called a split. The purpose of splitting is to make it more flexible. Usually, splitting is a complex process, and some people use them for arbitrage, while others use these features in the market. Simply put, holding a certain amount of BTC can be used to purchase various counterfeit coins and also invest in various tokens. Why choose the split mode because there was not much liquidity before the split. Firstly, if you want to buy more mainstream coins, be sure to buy those already issued tokens, as you mentioned earlier – as long as you have a certain position, your coin price has room to rise; Secondly, if you feel that your currency is not high enough, don’t sell it easily. Finally, in order to prevent the risks brought by speculative behavior, we need to find tools that can effectively manage price fluctuations. For individuals, it is best to avoid making frequent changes during trading Below are some methods for splitting. (1) Adding new currency supply to existing currencies

For example, 1% of the total supply of mainstream currencies such as Bitcoin will be destroyed, and the remaining 2% will be locked in for a period of time to reduce pressure in the circulation market; (2) After the launch of the new currency,