Wormhole

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Discover Wormhole'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 Wormhole?

Wormhole (W) is a multichain-native token that facilitates seamless transfers of value and information across various blockchain networks. It is designed to enhance the fluidity and accessibility of assets and data within the Decentralised Finance (DeFi) ecosystem, supporting applications such as cross-chain exchanges, governance, and gaming.

How is Wormhole used?

Wormhole (W) is the native token of the Wormhole interoperability platform, which powers multichain applications and bridges at scale. The token is designed to facilitate decentralized governance and decision-making within the Wormhole ecosystem. Here are some key aspects of how W is used:

  1. Governance: W holders will have the ability to shape the protocol's future by voting on governance proposals. Token holders can delegate their tokens to themselves or to others, allowing them to participate in the decision-making process.

  2. Token Distribution: The Wormhole platform conducted an airdrop of 549 million W tokens to users who had engaged with the ecosystem applications across over 30 blockchains. This airdrop aimed to decentralize the protocol stakeholders from the start.

  3. Decentralization: The token is a crucial step in advancing Wormhole toward a decentralized and permissionless future. The platform has handled over 1 billion cross-chain messages and facilitated the transfer of over 40 billion dollars, making it a significant player in the multichain ecosystem.

  1. Eligibility and Rewards: Users who had engaged with Wormhole's decentralized applications were eligible to receive W tokens based on their on-chain activity. An eligibility checker was provided to determine user eligibility, and users could claim their rewards through an intuitive interface.

Overall, the Wormhole token (W) is designed to empower users and stakeholders within the Wormhole ecosystem, enabling them to participate in governance and decision-making processes while promoting decentralization and interoperability across multiple blockchain networks.

How do I store Wormhole?

How to buy Wormhole?

To buy Wormhole (W) tokens, follow these steps:

  1. Create an account on a reputable cryptocurrency exchange: Choose a reliable platform like Kraken, Binance, BTSE, OKX, Nexo, or Kucoin to ensure secure and efficient transactions.

  2. Fund your account: Deposit funds into your exchange account using a payment method accepted by the exchange, such as Google Pay or Apple Pay on Binance.

  3. Search for Wormhole (W): Navigate to the exchange's marketplace and search for Wormhole (W) to access its trading page.

  1. Select Wormhole and your preferred currency: Choose Wormhole and your desired currency (e.g., USD) from the dropdown menus.

  2. Place your order: Enter the amount of Wormhole you want to buy and confirm your order. The tokens will be added to your exchange wallet once the transaction is complete.

  3. Optional: Transfer to a personal wallet: If you prefer to store your Wormhole tokens outside of the exchange, you can transfer them to a personal wallet like Phantom, ensuring you have the necessary SOL for transactions.

Remember to always exercise caution and verify the authenticity of any webpage or communication related to Wormhole to avoid scams and phishing attempts.

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History of Wormhole

The Wormhole (W) token was launched on the Solana network as a native SPL token. Following its initial launch, plans were made to extend its functionality to Ethereum and other EVM-compatible chains through Wormhole's Native Token Transfers (NTT) feature. This strategic rollout aimed to facilitate seamless asset transfers and interactions across multiple blockchain ecosystems, promoting a truly interconnected DeFi landscape.

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How Wormhole works

Wormhole (W) is a groundbreaking protocol that connects different blockchains, enabling them to communicate with each other seamlessly. This protocol is designed to break down barriers between blockchain ecosystems, fostering collaboration and innovation in the decentralized world.

Architecture of Wormhole

Wormhole's architecture consists of both on-chain and off-chain components. The on-chain components include the Wormhole Core Contract, which facilitates cross-chain communication, and Emitter contracts that interact with the Core Contract to emit messages. These messages are recorded in blockchain-specific transaction logs, which are observed by the Guardian Network.

Guardian Network and Validation

The Guardian Network is a group of 19 validator nodes that observe and validate messages emitted by the Core Contract. These nodes are responsible for ensuring the security and reliability of cross-chain transactions. When a message is emitted, the Guardian Network verifies it and produces a signed attestation called a Verifiable Action Approval (VAA). This VAA is then relayed to the target blockchain, where it is processed to finalize the cross-chain transaction.

Relaying Messages

There are two primary ways to relay messages with Wormhole: automatic relaying and specialized relaying. Automatic relaying requires no off-chain code and is currently supported only for EVM environments. Specialized relaying allows developers to customize the relaying process, providing more flexibility and control. This flexibility enables developers to tailor the relaying process to suit their specific needs.

Cross-Chain Applications

Wormhole opens up a wide range of possibilities for cross-chain applications. For instance, it enables the creation of exchanges that accept deposits from any Wormhole-connected chain, significantly enhancing liquidity accessibility for users. It also facilitates cross-chain governance, where groups spanning multiple blockchains can leverage Wormhole to combine votes on proposals. Additionally, Wormhole makes it possible to build cross-chain games, where rewards can be issued on different blockchains.

Security and Tokenomics

The Wormhole ecosystem is secured by a peer-to-peer network of Guardian nodes that pick, sign, and validate messages written to the Wormhole Core Contract. Messages and transactions passing through Wormhole are deemed valid if 13 out of the 19 Guardians sign the same message. The Wormhole tokenomics have allocated tokens to various stakeholders, including the Foundation's Treasury, the community, the ecosystem, and core contributors.

Trading Wormhole Token (W)

The Wormhole token (W) is listed on Bitget, allowing users to engage in secure crypto trading and explore the potential of cross-chain communication facilitated by Wormhole. Trading W on Bitget involves a simple process of going to the WUSDT spot trading page, entering the amount and order type, and clicking Buy/Sell.

Overall, Wormhole represents a significant milestone in the evolution of blockchain technology, bridging the gap between different blockchains and enabling a wide range of cross-chain applications.

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Wormhole's strengths

Wormhole (W) has several strengths that make it a significant player in the blockchain interoperability space:

  1. Multichain Governance: Wormhole introduces the first multichain governance system, allowing token holders on any supported chain to create, vote on, and execute governance proposals. This system ensures that decision-making is decentralized and community-led across multiple chains.

  2. Native Multichain Token: W is designed as a native multichain token, initially launching on Solana and expanding to Ethereum and other EVM-compatible chains through Wormhole Native Token Transfers (NTT). This allows for seamless asset transfers and interactions across different blockchain ecosystems.

  3. Cross-Chain Applications: Wormhole enables a wide range of cross-chain applications, including cross-chain exchanges, governance, and gaming. Developers can build exchanges that accept deposits from any connected chain, significantly enhancing liquidity accessibility for users.

  1. Security: Wormhole's architecture includes on-chain and off-chain components, ensuring robust cross-chain communication. The Guardian Network validates messages emitted by the Core Contract, ensuring secure and authentic inter-chain transactions.

  2. Scalability: Wormhole leverages Solana's high-performance ecosystem, providing scalability, low transaction costs, and rapid processing times. This makes it an ideal platform for high-volume transactions and applications.

  3. Interoperability: By connecting multiple high-value chains through a single integration point, Wormhole enhances the fluidity and accessibility of assets and data within the DeFi ecosystem.

These strengths position Wormhole as a leading interoperability protocol, fostering collaboration and innovation across different blockchain networks.

Wormhole's risks

Based on the provided search results, here are the key risks associated with the cryptocurrency Wormhole (W):

Security Vulnerabilities and Hacking Risks:

  • In February 2022, Wormhole suffered a major security exploit where 120,000 wrapped Ether (wETH) worth over $325 million was stolen due to a vulnerability that allowed forging of valid signatures.
  • This incident highlighted the inherent risks of cross-chain bridges like Wormhole, which connect multiple blockchain networks and can be targeted by hackers.
  • Even though Wormhole has improved security measures and launched a $10 million bug bounty program, the reputational damage from such a significant hack cannot be ignored.

Overvaluation Risks:

  • According to the analysis in one of the sources, Wormhole's fully diluted market cap to total value locked (TVL) ratio is around 2.3, suggesting potential overvaluation compared to other projects.
  • A high market cap to TVL ratio could indicate that the project is overvalued relative to its actual utility and adoption.

General Cryptocurrency Risks:

  • Like other cryptocurrencies, Wormhole faces risks associated with price volatility, regulatory uncertainties, adoption challenges, and the speculative nature of the crypto market.

While Wormhole has strengths such as a growing ecosystem, strong developer activity, and initiatives to support builders, the risks highlighted above, particularly security vulnerabilities and potential overvaluation, should be carefully considered by potential investors or users of the Wormhole network

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Did Wormhole raise funds?

Yes, Wormhole (W) raised funds in a significant funding round. The cross-chain protocol secured $225 million in funding, valuing the company at $2.5 billion. This raise was structured entirely in token warrants, which grant holders rights to tokens at a future date. The investors included prominent names such as Brevan Howard, Coinbase Ventures, Multicoin Capital, Jump Trading, ParaFi, Dialectic, Borderless Capital, and Arrington Capital. This funding round marked a significant milestone for Wormhole, solidifying its position as a leading blockchain messaging protocol and enabling it to further develop its technology and expand its capabilities.

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Wormhole’s team

  • Wormhole Labs Team:
    • Chun Wei Tang
    • Harsh Ghodkar
    • Akshat Sharma
    • Jerry Chen.

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The fundamental analysis assistant for crypto value investors.

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