Crypto Smart partners with Algopower, the first research and review project on Algorand, in a strategic partnership to reduce scams and rug pull in the Algorand blockchain.
According to Chainalysis, scams were once again the largest form of cryptocurrency-based crime by transaction volume, with over $7.7 billion worth of cryptocurrency taken from victims worldwide in 2021.
While total scam revenue increased significantly in 2021, it stayed flat if we removed rug pulls and limited our analysis to investment scams. ~ Chainalysis
Rug pulls have emerged as the go-to scam of the DeFi ecosystem, accounting for 37% of all cryptocurrency scam revenue in 2021, versus just 1% in 2020.
In all, rug pulls took in more than $2.8 billion worth of cryptocurrency from victims in 2021.
As is the case with much of the emerging terminology in cryptocurrency, the definition of “rug pull” is not well defined, but we generally use it to refer to cases where developers build pseudo legitimate cryptocurrency projects and set up wallets to receive cryptocurrency for fraudulent investing opportunities.
Most rug pulls involve developers creating new tokens and promoting them to investors, who trade for the new token in expectation that they will rise in value, which also provides liquidity to the project.
In rug pulls, however, the developers eventually drain the funds from the liquidity pool, sending the token’s value to zero, and disappearing.
This has been the order of the day in the crypto ecosystem, and the Algorand blockchain is not exempt from that.
Due to the rising simplicity of blockchain usage, it has become easier to build a token and rug pull.
To reduce the number of rug pulls on the Algorand blockchain, Algopower was built.
Algopower in short form can be regarded as the voice of sentimental analysis through its 3 Rs with the main aim of reducing rug pulls in the Algorand blockchain.
The philosophy of Algopower relies on the 3 Rs which are review, research, and recommendation.
According to the founder, most rug pulls in the crypto space usually come with a red signal but not everyone is capable of spotting it.
Through projects reviews, new projects in the Algorand ecosystem can be analyzed before a recommendation is given after in-depth research is carried out.
Although Algopower is the one behind the initiative, the power to decide still lies with the community through an incentivized review and research system.
The entire blockchain is controlled through incentives – mining. This implies that incentives can also be used to control fraud projects and rug pulling.
To know more about Algopower, read our AMA with Algo Power in our community group.
Benefits of the strategic partnership between Crypto Smart and Algopower
Since its establishment, Crypto Smart has engaged in several strategic partnerships to provide the Algorand Ecosystem with the best in asset management.
A Launchpad, as part of Crypto Smart’s products, is a way through which businesses can upscale to the blockchain. Specifically, to the Algorand blockchain.
The basis of the partnership is to provide reviews and recommendations on projects that want to increase through the CSPad.
Nevertheless, the benefits still include; but are not limited to:
Establishing the credibility of projects
The partnership with Algopower will provide the necessary credibility to projects.
Algopower will serve as a check and balance for all projects through its 3 Rs.
Harmonizing and protecting the community
Algorand blockchain is a community-driven blockchain that expresses a decentralized ecosystem through its pure Proof of Stake.
Algopower will help to harmonize the community against scams and at the same time protect the community.
In all this, Algopower will only serve as a channel since its strength also lies in the community.
Crypto Smart, on the other hand, will shine the light on projects that will be of value to the Algorand blockchain.
Quality control will become highly esteemed among founders if they are aware that there is going to be a check and balance on their ideas.
As Crypto Smart partners with Algopower, in the aspect of quality, projects will tend to deliver their best while rug pulls will be kept at their minimum.
Audit and Assurance
In summary, Algopower audits crypto projects using its 3 Rs and gives assurance to investors.
This process is based on in-depth research and review by experts and community members, making it a more trusted way of auditing than an audit carried out by a centralized authority.
The benefits are inexhaustible and Crypto Smart is open to strategic partnerships that can help the Algorand blockchain grow.
About Crypto Smart
Crypto Smart is a B2B Crypto Asset Management company founded in January 2021 by Karla Obakpolor, a blockchain business developer and Algorand ambassador in 2020.
Crypto Smart offers fast and secure services which are based on a well-encrypted system with 24/7 customer support services. Crypto Smart has grown from offering its services to individuals to companies and major enterprises as well as providing crypto education through various crypto courses.