2022 has been a tough year for digital assets, as investors grapple with recession fears, interest rate hikes, geopolitical tension, and surging inflation. Experts are of the opinion that this may be a good time to jump on the bandwagon and build a strong portfolio.
It’s even a better time if you are looking to build projects on top of blockchain technology. Ad networks like Cointraffic can easily help you gain traction through banner ads and press releases. You never know, your project might end up on this list of top cryptocurrencies.
Let’s catch a glimpse of what these cryptos bring to the table!
Launched in 2009 by a mysterious developer, Satoshi Nakamoto, Bitcoin is the first-ever virtual currency built on blockchain technology. It came into existence with the idea to eliminate intermediaries involved in financial transactions. The underlying mechanism is that of a distributed ledger, where data is secured by encryption methods. Any transaction on the network is verified by miners, and they are rewarded for this activity.
The influx of retail and institutional investments in the past few years has authenticated the status of Bitcoin as a “store of value”. History has shown that every time Bitcoin crashes to unexpected levels, it climbs back to reach unimaginable heights.
One of the largest blockchain ecosystems in the world, Ethereum is an open-source decentralised platform with smart contract functionality. It was created in 2015 by a group of programmers to allow a broad spectrum of applications to be built on its network. Just like Bitcoin, it currently uses the proof-of-work (PoW) consensus, which will soon be migrated to the proof-of-stake (PoS) mechanism.
The much-awaited upgrade will allow the network to be more scalable and cost-efficient. Energy usage is expected to go down by 99.95%, making it a sustainable alternative to other competitors. The highly anticipated “Merge” will be rolled out in phases, which may attract investments from retail and institutional players.
Tether belongs to a breed of cryptocurrency known as stablecoins that are pegged to the value of the US Dollar in a 1:1 ratio. The peg is backed by collateral reserves to ensure the stability of price against market volatility. It is currently the largest stable coin on the market used as a medium of exchange like traditional cash. The rapid growth in the popularity of stable coins can be attributed to its growing use cases in DeFi staking and lending protocols.
US Dollar Coin (USDC)
USDC is another tokenized dollar with its value pegged 1:1 to the US dollar. It is backed by reserved assets held in centralised US financial institutions. This stablecoin is compatible with several blockchains including Tron, Stellar, Solana, Ethereum, and Algorand. As a stable digital asset, it has multiple use cases such as remittances, hedging against volatility, blockchain interconnection, and passive income potential.
Binance Coin (BNB)
BNB is the native token of the world’s largest cryptocurrency exchange by volume. Launched in 2017 on the Ethereum network, it later transitioned to power the Binance Smart Chain ecosystem. Over the years, BNB has expanded to several applications beyond discounted trading fees. It can be used to pay for online services, for entertainment purposes, or to book travel arrangements. One can also participate in Binance Launchpad program to be eligible for an ICO airdrop.
Every quarter, some BNB tokens are removed from circulation based on the price and the number of blocks produced. The recent implementation of the Auto-Burn mechanism is a step towards boosting community through transparency and autonomy.
XRP is a digital asset built for a new global economy, where cross-border transfers can be instant, cheap, and hassle-free. The token is designed to run on the XRP Ledger, where network participants can validate transactions and secure the network. The underlying blockchain is much more energy-efficient than Proof-of-work concepts like Bitcoin and Ethereum. Compared to the traditional cash transfer system, transactions with XRP take less than 5 seconds with an average cost of $0.0002 per transaction. The parent company behind this technology is on a mission to make XRP, the SWIFT of crypto.
A brainchild of one of Ethereum’s co-founders, Cardano is a permissionless decentralised platform that uses Proof-of-stake consensus. It came into existence to mitigate the implications of high energy usage, low scalability, and exorbitant transaction costs of the Ethereum network. Cardano leverages an algorithm known as Ouroboros, which allows users to stake the native asset ADA, and earn rewards in exchange for securing the network. The utility of the token extends beyond staking, as it can also be used to participate in on-chain governance and pay for network transactions.
Binance USD (BUSD)
Founded by Binance and Paxos, BUSD is a stablecoin backed by US treasuries or reserves in US banks. It is designed to be stable against market volatility, which allows investors to hold fiat-equivalent assets without having to encash them. Speed, accessibility, and flexibility are three fundamental attributes of BUSD, as it can be used to transfer money across the globe with negligible fees. Regular audits are released by Paxos to back their claims regarding the reserves, and this is what makes BUSD different from other stablecoins.
Solana is a high-performance L1 blockchain platform created in 2017 to scale throughput without high transaction costs. It implements a unique consensus model that combines proof-of-stake with proof-of-history to process over 700K transactions per second. The third-gen blockchain infrastructure is designed to facilitate the development of decentralised applications, with a wide range of use cases in the world of NFTs and DeFi. The native token of the ecosystem, SOL can be used to secure blockchain through staking or participating in governance.
What started as a meme token has now emerged as one of the most popular altcoins in the crypto space. The underlying scrypt technology behind this asset is that of Litecoin, which uses the Proof-of-work concept. A massive community of top influencers has played a pivotal role in pushing the price of DOGE to unimaginable heights. While infrastructure may not have been the central focus of the project, an active group of miners has kept the Dogecoin operating with efficiency.