All About ApeCoin — A Growing Cryptocurrency or a “Pump & Dump” Disaster Waiting to Happen

FINTECH | CRYPTOCURRENCY

APECoin (APE) is a new decentralized project cryptocurrency modeled after the Bored Ape Yacht Club (BAYC) from Yuga Labs, which is quickly gaining attention.

Bored Ape in a Navy Hat — Pixabay — Arthur Shihman.

APE is a coin many investors are looking at and making investments in, but is it a valuable asset or just another “flash-in-the-pan” project currently being pumped that will soon disappear when whales are tired of playing with it?

A decentralized protocol layer for community-led initiatives that drive culture forward into the metaverse. — APECoin Official Website.

Alternatively, could it provide value other than to the BAYC members to buy lucrative non-fungible tokens (NFT)?

What’s the history and technology behind the APE BEP-20 token that could make it a worthwhile investment? Who are its founders? Should you put a few dollars into the project to see where it is going, or will it quickly flame out?

I will attempt to answer these questions by pouring through several sources including podcasts, Tweets, and YouTube video to give you a better idea if you should an investment.

FYI — The official APE website says, “Ape at its core a meme token…”

APE History

A team of developers created APE in early 2018. Their vision was a more user-friendly and scalable cryptocurrency. APE is based on a Bitcoin protocol but modified to make it easier to use and faster.

Although the original founders of Yuga Labs (this has been denied by the APECoin DAO) were heavily involved in the creation of APE, “…a carefully coordinated marketing campaign has taken great pains to dissociate ApeCoin from any one conventional corporation.” — Coin Desk.

Understandably, those involved with an APE token that sells for less than $20 would want to distance themselves from the “elitist” BAYC. Not to say that any of the members think that way, but it would be easy for a small-time investor to look at the BAYC as elitists.

“We embrace the fun and importance of innovation in the crypto space by incubating and developing unique platforms. GO APE! — APECoin Official Website.

What Is a DAO?

A Decentralized Autonomous Organization (DAO) “…is a way of organizing people and their interests on the internet using the blockchain. The blockchain is a public ledger system that exists only on the internet. It uses a complex cryptography system to ensure that everything written to it (“blocks”) is verifiable.” — Fast Company.

This is a group of people with a common interest. In the case of the Ape Foundation or Ape ecosystem, the aim is to build a fair and equitable infrastructure for APE token holders to “collaborate through open and permissionless governance.”

Let’s say, for instance, a billionaire founder decides that the “mining” process uses too much energy and is not good for the environment. They could not simply make a unilateral decision to suspend mining. They must put it to a vote within the DAO.

That administrative council is the “decision-maker” for the APE Foundation and provides its bookkeeping, day-to-day command and control, project management (PM), and other operations and processes to ensure the APE community has the service and support necessary to make its concepts reality.

The DAO allows users to vote on proposals to improve the APE network. This gives APE holders a say in developing and improving the currency.

ApeCoin Technology

ApeCoin uses a Proof-of-Work (PoW) consensus mechanism to validate transactions on its blockchain.

“Proof-of-Work (PoW) is a decentralized consensus mechanism that requires members of a network to expend effort solving an arbitrary mathematical puzzle to prevent anybody from gaming the system. Proof of work is used widely in cryptocurrency mining, for validating transactions and mining new tokens.” — Investopedia.

APE’s PoW algorithm is called ‘Lyra2REv3’. Lyra2REv3 is a modification of the original Lyra2RE algorithm created by the Vert Coin team.

“The Lyra2REv3 hard fork was an emergency measure to abolish ASICs on the Vert Coin blockchain.” — Where to Mine.io.

The main advantage of Lyra2REv3 is that it is designed to be resistant to Application Specific Integrated Circuit (ASIC) miners. This means that APE can be mined with Graphics Processing Units (GPUs), which are more widely available and affordable than ASIC miners.

Other coins and tokens besides Vert Coin (VTC) (trading at $.26) using the Lyra2Rev3 are Hana Coin (HANA) (trading at $0.00043) and Global Token (GLT) (trading at $0.00059).

Bored Ape in a Bowler Hat — Pixabay — Arthur Shihman.

NFT Marketplace

APE has also built an NFT marketplace (MonkeyFirm) into its protocol. The NFT marketplace will allow users to buy, sell, and trade NFTs. This will give APE holders a method to purchase unique digital items.

There are also games, comics, and other services upcoming, according to the APECoin official website.

The APE Team

The APE team comprises experienced developers with software engineering, cryptography, and marketing backgrounds.

The official word is that the BAYC project and Yuga Labs were not involved in creating the APECoin.

Some prominent DAO “board members” are Alexis Ohanian, a Reddit co-founder, Amy Wu from FTX, Dean Steinbeck from Horizen Labs, Maaria Bajwa from Sound Ventures, and others. Each DAO member is elected for six months.

What’s more essential is that you don’t need to own an APE NFT to be an APE DAO member. Owning APE tokens makes you a voting member with the same privileges as anyone holding the same number of tokens.

Why Is APE Unique?

APE is unique because it is one of the few cryptocurrencies based on the BTC and Lite Coin (LTC) PoW protocol but is ASIC resistant. This means that APE can be mined with GPUs, which are much more widely available and affordable than ASIC miners.

Another similarity to BTC used by APE is the Segregated Witness (SegWit) protocol. SegWit allows for smaller transaction sizes and improved scalability.

“SegWit fixed transaction malleability by removing the signature information (otherwise known as the “witness” information) and storing it outside the base transaction block. With that, signatures and scripts can be changed without affecting the transaction id.” — Coin Desk.