Author: Wenser, Odaily Odaily
The 314 protocol craze driven by ERC314 is gradually spreading to various chains. The last protocol standard that attracted so much attention was probably the ERC404 protocol led by Pandora. Looking back further, the recent hot phenomenon even reminded many people of the NFT craze led by ERC721.
From the launch of X314 on the BSC chain on March 27 to now (April 8), it has achieved a thousand-fold increase in just two weeks (the launch price was US$0.00349, and as of the time of writing, the price was around US$4.2, and the high point exceeded US$5.3). In addition, various 314 protocol tokens coded with the Meme prefix are attracting the attention of many traders on the one-stop on-chain trading platform Ave.ai with an increase of more than 30%.
In view of the hot performance of the 314 protocol, Odaily Odaily will lead everyone to understand this new protocol standard that claims to "kill DEX and other middlemen" (Note: At present, the 314 protocol is only a common name, which generally refers to the contract standard used for tokens that can be bought and sold through contract transfers. It is not endorsed by an official organization. Odaily reminds users that the new project market fluctuates greatly and the investment risk is extremely high. Please be sure to pay attention to asset security and choose investment targets carefully).
The Origin of 314 Protocol: A New Protocol Born out of a Social Experiment
https://app.simplifyerc.com/
So, where did the 314 Agreement come from?
Speaking of this, we need to move forward in time to that Wednesday about three weeks ago.
On the evening of March 20, 2024, the ERC314 protocol token SIMP was launched. Previously, the project raised 20 ETH, with a total of 1 million tokens, and distributed them in the proportion of 45% for LP, 45% for seed round pre-sales, and 10% for multi-signature CEX wallets. The innovation of this project is that users can directly transfer ETH to its contract to complete the purchase of tokens, transfer tokens to its contract to sell, and the gas cost is much lower than the swap transaction operation of DEX. The official white paper of the project gives a detailed description and introduction of the ERC314 protocol, and mentions that any project party can deploy ERC314 protocol tokens.
ERC-20 VS ERC-314 Comparison
After that, SIMP skyrocketed from its low point to over $50 in the early hours of the next day, an increase of hundreds of times.
On March 21, the official account of the ERC314 protocol @Simplify_ERC314 (currently the account has been cancelled) posted on the X platform emphasizing that the project is a social experiment. Subsequently, community members reported that there were problems with the contract formula of the protocol, and the liquidity pool LP Owner authority was not really transferred, and many people were attacked by clamps during the buying and selling process, and the transaction loss was widened. Although professional smart contract engineers later explained the contract formula xy=k, the SIMP token still fell in the fud. In less than a day, it fell to around $6, a drop of nearly 90% from the high point, and as time went on, it was close to zero, and the price fell to around $0.08. As of the time of writing, the SIMP token has risen to around $0.5 due to the market sentiment of the 314 protocol.
The ERC314 protocol innovation, which was originally expected to omit intermediate links such as DEX, save trading transaction costs, and prevent MEV attacks to a certain extent, came to an abrupt end. However, the new 314 protocol inspired and driven by this is already on the way.
- On March 22, the LONG314 token deployed on the BSC chain was launched, and users can directly transfer BNB to interact with the contract address to buy and sell tokens.
- On March 26, the project official stated that in order to optimize the defects of ERC314 and LONG314, it plans to expand and upgrade the protocol. In the future, it will add a sales cooling mechanism and LP burning mechanism to avoid bot attacks and promote token price increases.
- On March 37, the X314 protocol token deployed on the BSC chain was launched.
- On March 29, X314 launched a staking lottery event. The contract was upgraded to a 60s transaction cooldown, 24-hour automatic burning of 6% LP, and the destruction of more than 1 million X314 tokens every day.
- On April 1, the official BSCNews account published a sponsored tweet to promote the X314 project.
- On April 2, the price of X314 tokens skyrocketed, and the on-chain data attracted attention.
- On April 6, Ave.ai launched the X314 section and added a promotion spot for the X314 Telegram community on the homepage banner.
- On April 7, the price of X314 token exceeded $1.
- On April 8, the price of X314 tokens continued to rise, breaking through $5.3. As of the time of writing, the price of X314 has fallen back to around $3.8.
Driven by the rise of the X314 protocol and tokens, the transaction volume of many projects in the X314 section of the Ave.ai platform has surged, and buying and selling activities are extremely active.
The hottest 314 tokens
The following are the 314 protocol-related token projects that are currently more active and have higher market capitalization and liquidity. The data mainly comes from Ave.ai (Note: Odaily Odaily is only for sharing and communication, and does not endorse any project. Users are requested to DYOR, pay attention to asset security, and carefully choose investment targets).
X314: around $3.8
Total token supply: 21 million;
Contract authority: Not abandoned for the time being (the official explanation is that the contract is still being updated and needs to be repaired and optimized for problems);
Market value: about 33 million US dollars;
Total LP liquidity: approximately US$1.8 million.
As the leading token of the current X314 sector, X314 can be described as the “culmination” of the protocol——
- A certain degree of inheritance and innovation has been made to ERC314 and LONG314
- LongSwap platform provides a smooth Swap transaction experience
- There is a certain pioneering sales cooling mechanism and LP burning mechanism
- 90-day staking incentive campaign
- Community user incentive lottery activities and other operations
Thanks to the recent market performance and market operation activities, the X314 telegram community has gathered more than 13,000 people and the community communication is relatively active. It is worth mentioning that the X314 official account has received the attention of CZ, but it is not yet certain whether the account is a purchased account.
LONG-314: around $0.25
Total token supply: 21 million;
Market value: about 6.18 million US dollars;
Total LP liquidity: approximately US$360,000.
LONG314 is a token issued based on ERC314 and issued by the X314 project. The X314 official account has previously posted related tweets, and the token is bound to the 314 protocol Swap platform LongSwap.
BNB314: around $0.09
Total token supply: 20.23 million;
Market value: about 2.08 million US dollars;
Total LP liquidity: approximately US$250,000.
BNB314 was launched on April 6. The project owner claimed that it was jointly initiated by BNB whale and the local promotion community. It is consistent with X314 in terms of buying and selling operations, transaction cooling mechanism and prevention of clamps, but the LP deflation rate is 12%/day.
Y314: around $0.04
Total token supply: 20.4 million;
Market value: about US$900,000;
Total LP liquidity: approximately US$130,000.
Y314 was launched on April 6, and its main feature is "the first 314 protocol chromosome concept coin". It can be seen that this is a project that purely piggybacks on X314. Please be sure to pay attention to the risks.
BTC314: around $0.04
Total token supply: 17.8 million;
Market value: about US$720,000;
Total LP liquidity: approximately US$130,000.
BTC314 was launched on April 5th and is similar to other 314 protocol tokens. The only difference is that the 24-hour automatic LP burning ratio is only 2%.
DAPJ: $0.000048
Total token supply: 6.6 billion;
Market value: about US$320,000;
Total LP liquidity: approximately US$90,000.
DAPJ was launched on April 7. Different from the above 314 protocol tokens, it was issued on the Base chain and focuses on the Meme concept.
314 Protocol: Technological innovation or a flash in the pan?
Previously, when SIMP was first launched, the ERC314 protocol caused a wave of heated discussions. The following are some excerpts:
As early as March 19, the on-chain platform EV Terminal published a detailed explanation of ERC314 and SIMP on the X platform, saying that "ERC314 standard will change the way tokens are purchased and effectively reduce the gas fee cost on Ethereum." Not long ago, EV Terminal also Official Twitter announced that SageERC314 has acquired Simplify, the previous SIMP issuer, and will start to integrate SIMP with SAGE.
Previously, when SIMP was first launched, crypto KOL @0xSunNFT believed that "the core concept of ERC314 is to optimize the gas of token transactions, and only one transfer is needed to complete the transaction", and "the restriction that only one transaction can be conducted in the same block and the same address can prevent clamping", which is relatively innovative and "can be regarded as a project that can make people's eyes shine."
CryptoV, founder of AC Capital and manager of Open_Rug, regards ERC314 as "the latest advancement of Ponzi on Token", directly realizing "Token as an L2" and "Uniswap on Token", replacing the functions of L2 and DEX. To some extent, it has accomplished "what Facetswap wanted to do but failed to do", and its level is even far higher than "Pandora that denied NFTX" (that is, the project that brought up the concept of ERC404).
Crypto researcher Haotian briefly reviewed and summarized the "failure" of SIMP and the ERC314 protocol. He believes that, first of all, "ERC-314 is a new standard, just like other token standards such as ERC20, but its innovation has been "overrated."
Secondly, "ERC314 adopts a 'black box' pricing mechanism. Through this predefined and decentralized method, it reduces the slippage and high gas fee problems in real-time swap calculation prices. The disadvantage is that the 'black box' logic setting within this contract needs to be based on user trust, and whether the contract publisher is malicious is also the key to the problem."
Finally, "ERC314 has made some 'fine-tuning' to the original transaction paradigm, adding a 'pre-processing' or 'black box' operation logic to the contract pricing mechanism and the token 'buying and selling' method. I am more inclined to think that this is an intent transaction paradigm, which is particularly suitable for some small MEME currencies to be circulated through private placement. Because it involves relatively complex contract logic and possible centralized trust issues, it is difficult to become a mainstream large-scale asset circulation method."
Overall, Haotian believes that ERC314 is a niche and micro-innovation gameplay, which is more suitable for the usage scenario of "niche meme speculation" and is difficult to be accepted by the mainstream market.
The recent 314 protocol craze driven by X314 is regarded by more people as a short-term hype target. Most people mention this project and projects of this type by promoting their advantages such as "no transaction fees, relatively low market value, CZ attention, backed by the platform and pledge", which is quite similar to the style of a ground-based promotion army. Therefore, the future market performance of the 314 sector represented by X314 is still highly uncertain.
in conclusion
In general, X314 has made certain innovations based on ERC314. The transaction cooling mechanism and LP burning mechanism have also alleviated the intensity of on-chain PVP to a certain extent, thus avoiding the "mistakes" of SIMP. The BSC chain ecosystem has grown new branches, but due to the extremely strong liquidity, the friction cost of buying and selling transactions has been reduced to a minimum, so it is difficult to avoid short-term price fluctuations and market value fluctuations.
In addition, the project party's control over contract authority is also a potential hidden danger in this type of project. Therefore, participating in such projects is relatively risky, and the subsequent development of the project and the trend of the token depend to a large extent on the project party's layout and operations.
Therefore, it is difficult for the 314 protocol to become a standard protocol like ERC 721 and be widely used in the short term. However, we have reason to believe that the mechanism that can accelerate the efficiency of capital liquidity circulation and enhance the decentralized trading of tokens will develop towards more on-chain ecosystems in the future, and in some tracks and fields, it will complement trading channels such as DEX.
