Swarm-related risks at the bottom

Swarm, the “king” project, what are the “pitfalls”?

The pitfalls of Swarm project

When the Ether team officially announced the launch of Swarm project, perhaps all insiders felt that another king-class project was coming. As the genius creator of Etherium, Vitalik Buterin, and his team are working hard to build Swarm, which is the “hard disk of the world’s computers”, it has won everyone’s attention since it was born, and many people expect that it might be the next rocket to the moon. Wouldn’t it be a pity to miss it?

But with a lot of eyeballs, comes a lot of chaos.

After Swarm announced its soft launch on June 13 and the public sale of its token BZZ on CoinList on June 14, two official tweets with the same content were sent out in quick succession, which read

Dear Swarm fans, please note that

  • BZZ tokens are not yet deployed.
  • If you have any questions or concerns, please consult the relevant channel on the official website ethswarm.org.
  • The only channel to purchase BZZ on public platforms is currently on CoinList.
Swarm-related risks at the bottom

In the official Swarm soft launch announcement, it also reads

Please beware of scams, exchanges, projects or individuals claiming to offer BZZ tokens are not affiliated with the Swarm Foundation and the Swarm Foundation does not endorse such activity prior to the main launch. the Swarm Foundation has not approached any exchanges regarding the launch of BZZ. Private buyers are not allowed to pledge tokens prior to the launch of the main site.

From this series of scam alerts and risk warnings, it is easy to see that the existence of Swarm-related scams on the market has alarmed the project team, causing them to repeatedly remind users not to fall for the scam. So what are the “pitfalls” of Swarm, a project that has been hailed as a “king”?

Swarm-related risks at the bottom

BZZ Token Selling Scam

As the official reminder, BZZ has not been officially distributed yet, and only CoinList is available for public reservation to buy BZZ. All exchanges or individuals claiming to sell BZZ at this stage are implicitly extremely risky and have a very high possibility of being a scam.

For example, some scammers will claim that they have a private placement quota for BZZ, and will credit the BZZ purchased by the purchaser to their wallets once the BZZ distribution is online on the main website, etc.

In this case, some users cannot judge the authenticity of the information provided by the other party, especially in the field of cryptocurrency trading, due to its unique encryption properties, once the money is credited into the other party’s wallet in advance as required, the possibility of recovery is basically zero and the loss is heavy.

In addition, since Swarm is currently conducting a test network million token airdrop event, in which you can get checks for mining, and the checks can be used to exchange for official airdrops of BZZ when the main network is officially launched, some individuals or mining farms have taken this activity to start selling checks. It is important to note that there are significant risks associated with this type of selling.

Risk Point 1: There is no way to determine if the counterparty actually holds a valid check. This situation is similar to a token selling scam in that once the money is paid into the counterparty’s wallet in advance, it cannot be recovered.

Risk point two: only valid checks can be used to redeem BZZ. the so-called valid checks are checks generated by interacting with 35 randomly determined queen bee nodes, which are completely randomly determined and no one (including the Swarm team) can predict which nodes will become queen bee nodes before the end of the airdrop campaign. Currently, the number of nodes in Swarm’s network is in the order of 10,000, from which only 35 queen nodes are selected, so it is conceivable that the percentage of valid checks is not too high.

Risk point 3: There is no way to determine the value of a valid check. The number of valid checks will be less than 1 if the number of valid checks exceeds 1 million, and the value of a valid check cannot be predicted because the number of valid checks cannot be predicted.

BZZ mining project risk

Since the Swarm project is a project of the Ethernet team and was born as one of the three pillars of building Web3.0 – “storage”, its prospect is quite attractive, so many users who are optimistic about its long-term value have already set their eyes on Swarm The mining project of Swarm. As there is a potential demand, there will be a market, so various Swarm physical node pre-sales, mining pools, mining machines for sale and other projects began to emerge.

At present, Swarm has not officially disclosed its specific mining mechanism, but according to known information, its mechanism is likely to be close to Filecoin, that is, mining requires “pledging”.

Remember that a similar situation existed when Filecoin was about to go live. As you can imagine, some investors lost a lot of money because they were not able to adapt to the new mining mechanism and lacked the pledges needed for mining.

Before the official announcement of Swarm’s mining mechanism, all mining projects related to it should be treated with caution. In order not to expose users to the risks involved, “Blue Shell Cloud Storage” has decided not to launch mining projects related to Swarm before its mining mechanism is officially disclosed. However, at present, “Blue Shell Cloud Storage” has actively deployed a large number of Swarm test network nodes and mining machines, and once the main network is officially launched, it will be possible to seamlessly open the Swarm mining project, at which time users can actively participate in it with the understanding of the Swarm main network mining mechanism.

BZZ Futures Spot Spread

At present, BZZ futures are commonly traded on the exchange, and from the data shown on the LBank trading platform, BZZ futures have risen to 250U or less.

However, comparing the official Swarm sale on CoinList, which priced each BZZ at $1.92, the current price of BZZ futures is very high. This means that users are extremely optimistic about its value, but we must also consider the possibility of excessive speculation and the possibility of a crash in the BZZ futures market when BZZ is officially distributed on the main website (Disclaimer: Blue Shell Cloud Storage does not make predictions about the value of BZZ and is only providing a possible scenario here), so users who are currently investing in BZZ futures on major trading platforms must The company’s main business is to provide a wide range of products and services, including

The pit of BZZ check collection

In the current Swarm test network mining, users need to collect checks (cashout) in advance, and the collection process requires the consumption of Ether Goerli test coins. The test coins mainly come from taps: https://faucet.goerli.mudit.blog/

There are some potholes in BZZ check pickup that users need to pay more attention to.

Pit number one: the taps that issue test coins often fail to issue coins.

Pit No. 2: The coins issued are relatively small, and each account can receive 36 coins every 9 days.

Pit No. 3: The early team of the test network did not encourage people to actively collect the check, thinking that users only need to wait until the main website is online to collect it, and the official Discord group has also been encouraging people not to collect it in advance. Therefore, many users have been waiting for the main website to go online, and have not collected their checks in the backlog. Now that the main online launch date is approaching, a large number of users are concentrating on collecting their checks, and they need to use Geth to collect them, so the network will definitely be congested.

Pit #4: The gas price of Goerli’s test network has been rising, so more Geth will be consumed.

Pit #5: Many miners get {message: cannot cash cheque, code:500} error when collecting (cashout) checks, one possible reason for this error is that the Goerli test network’s gas price is soaring due to the recent concentration of check collection, and the miner nodes do not have enough Geth to pay for the check collection fee. In this case, you can top up your Geth test coins and collect them again.

Finally, “Blue Shell Cloud Storage” once again reminds everyone that no matter how divine the project is, it is inevitable that some risks exist. All investments are accompanied by risks, so while paying close attention to Swarm-related developments, users must be cautious and invest rationally.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/swarm-related-risks-at-the-bottom/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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