Starknet

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Discover Starknet's fundamentals and latest news.

This content was generated by Whalee (BETA), an AI crypto assitant that analyses cryptocurrencies. Informations can be incomplete and/or erroneous. Please always double check and DYOR.

What is Starknet?

Starknet (STRK) is a permissionless, decentralized layer-2 scaling solution for the Ethereum blockchain. It uses zero-knowledge rollup technology, specifically STARK proofs, to validate transactions off-chain and submit them to the Ethereum mainnet, increasing scalability and reducing fees. The STRK token facilitates transactions, governance, and staking on the network.

How is Starknet used?

The Starknet (STRK) cryptocurrency is used in several ways within the Starknet ecosystem:

  1. Payment of Fees: STRK is used to pay transaction fees on the Starknet network, providing an alternative to Ethereum (ETH) for fee payments. This allows users to choose between paying fees in STRK or ETH, offering flexibility and potentially reducing costs for network interactions.

  2. Governance: STRK token holders can participate in governance decisions affecting the Starknet protocol. This includes voting on various issues that shape the network’s development, policy, and future direction. Users can either directly participate or delegate their votes to reliable representatives of the network.

  3. Staking: STRK will be used within a proof-of-stake (PoS) model that underpins the network’s security and decentralization. By staking STRK, users can support the network’s operation, contribute to its security, and in return, receive rewards. This staking mechanism is designed to select among a decentralized network of sequencers, ensuring that Starknet remains secure, efficient, and resistant to centralization.

These uses of STRK are integral to the functioning and growth of the Starknet ecosystem, enhancing its scalability, security, and user adoption.

How do I store Starknet?

To store Starknet (STRK) tokens, you can use various methods:

  1. Ledger Device: Install the Starknet (STRK) app on your Ledger device. Connect and unlock your Ledger device, then open Ledger Live and navigate to the "My Ledger" section.

  2. Bitget Wallet: Download the Bitget Wallet app, which supports Starknet tokens. This wallet offers secure asset storage, easy access to your tokens, and integration with other Starknet DApps.

  3. KuCoin Account: Store your STRK tokens in your KuCoin account. You can also use non-custodial wallets for added security.

  1. Starknet Wallet: Create a crypto wallet on the Starknet mainnet using the Bitget Wallet or other compatible wallets. This allows you to manage your STRK tokens and interact with the Starknet ecosystem.

  2. Hardware Wallets: Use hardware wallets like Ledger to store your STRK tokens securely.

These options provide a range of choices for securely storing and managing your Starknet tokens.

How to buy Starknet?

To buy Starknet (STRK) tokens, you can follow these steps:

  1. Create an account on a cryptocurrency exchange: Choose a reliable exchange such as Coinbase, Kraken, or Bitget. Create a free account and connect a funding method.

  2. Select Starknet Token: On the exchange's platform, search for and select Starknet Token (STRK) from the list of available assets.

  3. Place an order: Navigate to the buy panel and enter the amount of STRK you want to purchase. Confirm your order and complete the transaction.

Alternatively, if the token is not listed on your preferred exchange, you can use a decentralized exchange (DEX) that supports the Ethereum blockchain. Here's how:

  1. Download a crypto wallet: Choose a wallet like Trust Wallet that supports the Ethereum network. Set up the wallet and ensure you have a secure seed phrase and wallet address.

  2. Buy ETH as a base currency: Purchase Ethereum (ETH) on an exchange like Binance and transfer it to your crypto wallet.

  3. Choose a DEX: Select a DEX that supports your wallet, such as 1inch. Connect your wallet to the DEX using your wallet address.

  1. Trade ETH for STRK: On the DEX, select ETH as the payment and STRK as the coin you want to acquire. Complete the swap transaction.

Remember to always follow security guidelines and be cautious of scams when using DEXs.

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History of Starknet

Starknet, a Layer 2 network built on top of Ethereum, has a significant history that highlights its development and growth. Here are the key points:

  • Launch and Initial Trading: Starknet Token (STRK) began trading in February 2024, initially at $5 on Kucoin, before settling at $3.50 in a volatile opening period.

  • Airdrop and Distribution: Starknet conducted the largest airdrop of the year, distributing 728 million tokens to around 1.3 million addresses. The total supply of STRK is 10 billion tokens, with 50.1% allocated to the Starknet Foundation for community airdrops, grants, and donations.

  • Pre-Launch Trading: Before the official launch, STRK pre-launch perpetual futures were trading at $1.80 on the decentralized futures platform Aevo.

  • Network Development: Starknet first went live in November 2021 and has since amassed nearly $55 million in total value locked (TVL) according to DefiLlama.

  • Scalability and Security: Starknet operates as a Validity-Rollup (ZK-Rollup) Layer 2 network, enabling decentralized applications to scale massively without compromising on security. It achieves this by bundling transactions off-chain and submitting them to Ethereum as a single transaction, ensuring higher throughput, faster processing times, and lower costs.

  • Tokenomics and Governance: The Starknet Token is necessary for governance, transaction fees, and consensus mechanisms. The token supply will increase over time, with a 4-year lock-up period for tokens allocated to Core Contributors and Investors.

  • Battle-Tested Technologies: Starknet's underlying technologies, including the STARK Prover and Verifiers, have been battle-tested in production on Ethereum Mainnet since 2019 and 2020, respectively.

  • Developer Tools and Support: Starknet provides developers with tools and infrastructure, including the Starknet Book and the Starknet Discord server, to facilitate development and innovation on the network.

Overall, Starknet has made significant strides in its development and adoption, offering a scalable and secure solution for decentralized applications on Ethereum.

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How Starknet works

Starknet is a layer-2 scaling solution built on the Ethereum blockchain. It aims to enhance Ethereum's scalability by processing transactions off-chain and then submitting the proof of those transactions to the Ethereum mainnet. This approach significantly reduces the load on Ethereum, making it more efficient and cost-effective.

Key Components
  1. Off-Chain Processing: Starknet processes thousands of transactions off the Ethereum blockchain, bundling them into a single object called a "Proof." This Proof is then submitted to Ethereum as a single transaction, reducing the load on the network.

  2. Zero-Knowledge Proofs (ZK-Proofs): Starknet uses ZK-Proofs, which ensure the security and privacy of transactions. These proofs allow the validation of transactions without revealing specific details, maintaining user privacy.

  3. Native Smart Contract Language: Starknet uses Cairo as its native smart contract language, which supports advanced DeFi and Web3 features. This language allows developers to create immersive decentralized applications (dApps) with ease.

  1. Appchains: Starknet Appchains are purpose-built subnetworks that provide superior flexibility. Developers can create these sub-chains in minutes, customizing aspects such as fees, consensus mechanisms, block size, and latency.
Token (STRK)
  1. Utility Token: The main utility token for the network is STRK. This token empowers users to interact with the entire suite of Starknet tools, including paying gas and transaction fees, trading, and leveraging advanced AI models and tools.

  2. Governance: STRK token holders can participate in governance votes, shaping the future of Starknet. They can also delegate their voting power to reliable representatives.

  3. Staking: In the future, STRK will be used for staking within a proof-of-stake (PoS) model, enabling stakers to choose among a decentralized network of sequencers and ensuring Starknet's decentralized operation.

Benefits
  1. Scalability: Starknet significantly enhances Ethereum's scalability by processing transactions off-chain, reducing congestion and increasing throughput.

  2. Security: Starknet maintains Ethereum's security by using ZK-Proofs and ensuring that transactions are validated securely.

  3. User-Friendly Interface: Starknet provides a straightforward, user-friendly interface, making it easier for developers to onboard and create dApps.

  1. Passive Returns: Users can stake their STRK tokens to secure low-risk passive rewards, which helps both the user and the network.
Consensus and Governance

Starknet operates on a proof-of-stake (PoS) consensus mechanism, which is more open and democratic compared to traditional mining-based systems. Governance is decentralized, with token holders participating in votes to shape the network's future.

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Starknet's strengths

The token Starknet (STRK) has several strengths:

  1. Governance: STRK token holders can participate in governance activities, such as voting on network upgrades, protocol updates, dispute resolution, and public goods funding, ensuring that the community has a say in the network’s development.

  2. Transaction Fee Payments: STRK can be used to pay transaction fees on the network, offering flexibility and potentially reducing costs for users. This functionality allows users to choose between paying fees in STRK or ETH, enhancing user experience and encouraging wider adoption.

  3. Staking for Consensus: STRK is used within a proof-of-stake (PoS) model that underpins the network’s security and decentralization. By staking STRK, users can support the network’s operation, contribute to its security, and receive rewards.

  1. Scalability and Security: Starknet, the Layer 2 network on which STRK operates, enhances the scalability and privacy of blockchain networks, particularly Ethereum, by processing transactions off-chain and using Zero-Knowledge Rollups (ZK-Rollups) to reduce gas fees and network congestion.

  2. Inclusive Ecosystem: Starknet aims to foster a more inclusive blockchain ecosystem by dramatically lowering transaction costs and increasing throughput, making blockchain technology more accessible to individuals and businesses worldwide.

These strengths collectively contribute to the robustness and efficiency of the Starknet network, enhancing user experience and promoting widespread adoption of blockchain technology.

Starknet's risks

Starknet (STRK) faces several risks that investors should be aware of:

  1. Regulatory Uncertainty: Starknet, like other cryptocurrencies, is subject to regulatory changes that could impact its usability and value. The regulatory environment, particularly in the United States, is still unclear, which could lead to legal issues and affect the token's value.

  2. Market Volatility: Cryptocurrencies are known for their price fluctuations, and Starknet is no exception. Investors should be prepared for potential market swings that could result in significant losses.

  3. Competition: The blockchain space is highly competitive, with many layer 2 solutions vying for market share. Starknet competes with well-established platforms like Ethereum and Binance Smart Chain, as well as other layer 2 solutions like Arbitrum, Optimism, and ZkSync.

  1. Scalability Challenges: While Starknet's use of zero-knowledge proofs promises to address scalability issues, it still needs to prove its ability to handle high transaction volumes and maintain its performance.

  2. Security Risks: Although Starknet's STARK technology is designed to be secure, there is always a risk of potential security breaches or vulnerabilities that could compromise the network.

  3. Community and Adoption: Starknet's success depends on attracting users and liquidity. If it fails to gain traction, its value could suffer.

  1. Technical Risks: The platform's reliance on a new programming language, Cairo, could lead to compatibility issues and make it difficult for developers to migrate applications from Ethereum.

These risks highlight the importance of thorough research and a balanced perspective when considering an investment in Starknet (STRK).

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Did Starknet raise funds?

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Starknet’s team

  • Eli Ben-Sasson: Co-founder and President of StarkWare Industries, the company behind Starknet. He is a professor of computer science at the Technion-Israel Institute of Technology and has made significant contributions to the development of zk-STARKs, a type of zero-knowledge proof technology used in Starknet.

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