The Top Cryptocurrency and Blockchain Projects in 2018

There’s been a change in the outlook for cryptocurrency during the past few months. People seldom talk about the markets or the price of Bitcoin. Volatility has been causing a lot of uncertainty, and mainstream adoption came to a virtual standstill.

Nonetheless, the cryptocurrency space showed remarkable resilience as blockchain projects continue to expand its borders with more lateral thinking and “out-of-the-box” blockchain solutions. We’ll explore some of their use-cases and find out whether these currencies and platforms are the next big thing.

 

Why People Invest in These Projects

Despite the recent lull in cryptocurrency trading and mining, blockchain projects and ICOs are very much in the business for 2018. Investors and tech companies remain optimistic about the future of the cryptocurrency space amidst tightening restrictions and negativity. In fact, according to Coindesk, the amount of money raised in ICOs in the first quarter alone exceeded the total amount last year.

Most ICOs and blockchain projects didn’t end up well for a lot of investors (more than 90% failed to deliver). However, there are a few examples like Binance and EOS which turned out as good investments. Binance became one of the leading cryptocurrency exchanges with a BNB market cap of over $1 billion – the second most valuable token on Coinmarketcap. EOS, on the other hand had a successful, albeit controversial mainnet launch, and is now a full-fledged decentralized application platform second only to Ethereum.

Smart investors consider the current state of affairs as a golden opportunity to hunt for new projects with the greatest potential, particularly in their early stages when they are mostly undervalued. Investing early on has the advantage of maximum gains with the least amount of exposure. For instance, a hundred dollars’ worth of investments at ten cents per token won’t break the bank if things go south. But if it turns out to be a real investment, gains will be exponential (e.g., BNB and EOS tokens are worth a hundred times more than their initial price in 2017)

 

 

Blockchain Projects to Watch for in 2018

Finding a good investment can be a real challenge since we’re dealing with dozens of new blockchain projects and ICOs every month. If you’re lucky enough, you might be able to land on some big winners from a list of projects. But before anything else, please bear in mind that this is not investment advice, and you are solely responsible for any gains or losses. That said, here are five of the most talked-about blockchain projects in 2018.

 

Zilliqa (ZIL). Launched in January, the project puts a lot of work in building a highly scalable decentralized platform using a method known as “sharding.” Unlike in Bitcoin, each node will be working in parallel within a group of nodes called “shard,” verifying a subset of all the transactions occurring at the same time (also called parallel processing). Sharding works perfectly in many centralized systems (Ultima Online, Google, etc.). However, it presents an immense technical challenge when applied on a decentralized environment. Ethereum has been working hard on it as part of its on-chain scaling solution in hopes of solving the security/scalability/decentralization trilemma. Zilliqa’s entry into the whole sharding scene threatens to steal the thunder from Ethereum by becoming the first to come up with a workable solution. Some estimates it to be around January 2019. Key features include:

  • faster transaction throughputs (speed improves as the network grows)
  • employs practical Byzantine Fault Tolerance as a consensus mechanism
  • reduced energy consumption (mining is spaced a hundred blocks apart)
  • maintains a decentralized network structure (a new shard is created for every 600 nodes)

Basic Attention Token (BAT). Cutting the middleman goes beyond peer-to-peer transactions to include decentralized, blockchain-based digital advertising in the form of an open-source, ad-free browser with its own currency. Brave Browser is one of today’s hottest Internet browsing software because it allows users to block ads and trackers completely free. In fact, as many as 3 million people have already been using Brave, becoming one of Google Play’s top ten in the Android browser category. The project is moving towards the creation a decentralized advertising platform using its own currency – Basic Attention Token – to incentivize both content creation and user attention. It works in some ways like Google Ads but in a more transparent and decentralized manner. The key advantages of BAT from an investor’s point of view include:

  • good potential for adoption (sold out BAT worth $35 million in 30 seconds)
  • strong support from the community (Brave browsing experience receive a lot of positive feedback from users)
  • a solid team of experienced developers (founded by no less than the co-founder of Mozilla, Firefox, and creator of JavaScript)

Kin (KIN). Canadian messaging app company Kik Interactive is making headway into cryptocurrency adoption with the launching of Kinecosystem. The company hopes to build a community of users and developers sharing resources, and making digital goods and services. However, unlike most blockchain startups with no real users, Kin’s integration into the Kik Messenger meant its value could potentially rise with over 300 million active users.  The company is now moving towards the next phase, inviting all developers and content creators in building the ecosystem for large KIN payouts. Gains will take time, but you might want to consider its advantages, namely:

  • KIN’s practical use-case as a digital currency on an existing application (Kik has been in use since 2010)
  • user base is mostly made up of digital-natives (teens, millennials, and active mobile users)
  • Kik’s emphasis on anonymity

DeepBrain Chain (DBC). Blockchain companies like DeepBrain Chain sees decentralization as the future of the AI industry. Development of AI applications use up a huge amount of computing power. DeepBrain Chain works by utilizing computational resources across millions of nodes on the neural network in building AI applications which are then published onto the blockchain. Nodes that successfully deploy mirror images will receive payouts in DBC. It plans on migrating out of NEO to its own mainnet in Q4, with its own consensus algorithm (proof of importance and delegated proof of stake). The goal is to become the deep learning machine for the AI industry. Successful adoption is achievable through:

  • growth in people’s interest in the AI industry
  • reduced computational cost of AI companies through resource-sharing
  • secure, decentralized method of storing AI information.

Wormhole. Bitcoin Cash might soon be able to run smart contracts through its proposed protocol layer known as Wormhole. Developers plan on forking the Omni Layer to create a platform for smart contracts on top of Bitcoin Cash. Much of it is still in the works as of this moment, but news is, they’re going to issue a token named “Wormhole Cash.” Investors and crypto-enthusiasts are keeping track of its progress since it is expected to have a very high demand upon release.

 

Conclusion

The cryptocurrency space has been constantly evolving even as the noise and the hype surrounding cryptocurrency have mostly faded. Cryptocurrency is here to stay, and we’ll be seeing more projects in the near future that will bridge the gap between the average user and blockchain technology.

Implications of Cryptocurrency Adoption to the Economy

Currency has gone through many forms and different stages of development. Throughout history, people have always been looking for a better means to store wealth in the most secure way possible. Cryptocurrency promises to be a much better alternative to fiat or gold by unlocking its true potential as a decentralized form of money.

What are the implications of adopting a singular currency on the world’s economy, and will it solve our problems with the current financial system?

 

Gold as a Standard of Value

In theory, anything can be used as money, from cowry shells, to salt (“salarium,” where we got the word “salary”). Whereas in the past, people used to barter with grain, livestock, jewelry, nowadays, we use paper, stamped coins, and electronic data. Gold and silver turned out as the most predominant form of money for thousands of years because they possess certain qualities which make them ideal as a measure of value.

Cryptocurrencies like Bitcoin makes an allusion to these precious metals because it mirrors some important qualities of its real-world counterpart (in fact, this could be the inspiration behind Bitcoin’s gold-inspired logo). We’ll learn why such reference is essential in understanding cryptocurrency’s role on the future of finance and its implications to the world economy.

 

The First Decentralized Currency

Gold has for millenniums been accepted as money, even before the adoption of state-backed fiat currencies. Anyone can turn in their gold to any bank in exchange for gold certificates or banknotes, and it will be counted as money. Under this system, gold was considered as a “decentralized” form of money.

In its early days, banks were mostly self-regulated and are bound by the fact that they cannot issue more than is redeemable without facing the risk of a bank run. However, everything changed after so many banks got into trouble issuing more money than it could pay for. They adopted a “Keynesian” approach to their monetary policy, thus ending the reign of the gold standard, and giving rise to quantitative easing, fractional reserve banking, and currencies which were nothing more than public debts and glorified IOUs.

The concept of a “decentralized currency” was put on the backburner for decades, until 2008-2009 when the world’s economy and the whole financial system came crashing down, and a mysterious author rekindled the world’s interest in a decentralized form of money – cryptocurrency. It’s no surprise that Bitcoin bears a striking similarity to gold, some even calling it as “digital gold,” for sharing the same features which make it suitable as a measure of value and store of wealth.

 

 

The Real Cost of Inflation

One of the earliest records of inflation can be traced back to 3rd century Rome when government spending went far beyond its means and began increasing its money supply with silver coins of lesser quality. This offered a false sense of security and prosperity as the government stretched its resources thin in waging wars and funding its pet projects. People soon realized that their silver coins were nothing but cheap imitations, as prices of commodities soared by 1000% across the Roman Empire.

Western and European countries committed the same error by inflating currencies through deficit spending in order to fund the war effort. Belligerents on both sides took a heavy toll on their own economy and their own people. Price levels and interest rates have gone up after the war, and millions of people have lost their jobs as many industries came to a grinding halt.

By then, the only plausible way to cure inflation is to create more of it. But after growing concerns about the value of the U.S. dollar, countries started to redeem their dollar holdings in gold. Deficit spending, balance of payments, and the run on gold eventually led to the collapse of the Bretton-Woods system, and all industrialized countries started using “floating currencies.”

The long-term effects of inflation led many people to find ways to secure their own wealth against the uncertainty of the current financial system.

 

The Need to Re-establish a Standard of Value

The gold standard made it possible for countries to maintain a more stable economy because it restrained governments from inflating the money supply and made it easier to keep track of prices of goods and services. It served as a reliable tool where one’s currency can be measured against, making it a real store of wealth as opposed to state-backed fiat which could lose all of its value overnight.

Nowadays, we have cryptocurrency which is being used as a medium of exchange, store of value, and platforms for decentralized applications. Some of the positive effects of re-establishing a standard of value on our currencies include:

Stabilize pricing. Having a standard of value on our currencies like gold or cryptocurrency makes it easier to see the relationship between money supply and the country’s real GDP. In a highly industrialized country, increased productivity meant prices will fall relative to the money supply (deflationary). Some analysts believe a deflationary currency (Bitcoin and other similar cryptocurrencies) is bad for the economy and should be avoided because it slows down borrowing and buying activity. Inflation, on the other hand, will induce consumerism since people would have more to spend. But nominal GDP (not the real GDP) arising from inflation, amongst other factors, doesn’t necessarily mean the economy is much better. It just meant everything is getting more expensive than it used to. Left unchecked, it can actually lead to situations mentioned earlier.

 Simplify trades and exchange rates. Trading goods and services with other countries can cause trading imbalances due to the fact that all currencies are “floating currencies”, except in few countries where the value of currencies is pegged to the US dollar. Since exchange rates of floating currencies are in a constant flux, it would be difficult to determine the price of certain commodity is at a certain point in time. By establishing a standard of value to all of our currencies, we might be able to make international trades and exchanges rates much easier and straightforward.

 Minimize deficit spending. One of the biggest problems in our current financial system is that it gives too much freedom for governments to spend more than they reasonably should. Quantitative easing and fractional reserve banking encourages more spending and borrowing, but only a fraction of it might actually go to productive endeavours, thereby pushing countries even deeper into debt. By adopting a system of checks and balances in the production of money, governments will be more accountable on how they chose to spend their resources.

 

 

Gold or Cryptocurrency?

 

Many people are advocating the return to the gold standard because it makes them feel safer, more secure, and gives them the ability to store wealth and manage their own resources as they see fit. But in this digital age, storing wealth can be as simple as having your own account on a global ledger, which cannot be controlled by anyone. Cryptocurrency offers a much better way, not only as a store of wealth but as a means of encouraging reforms in our current financial system.