The World Of Cryptocurrency And An Analysis Of The Top Ten Coins

HOW IS CRYPTOCURRENCY DEFINED? 

At its heart, cryptocurrency is a decentralized digital currency meant for online use. Cryptocurrency enables value to be transferred online without the use of an intermediary such as a bank or payment processor, enabling value to be transferred internationally, near-instantly, and 24/7 at a cheap cost. Typically, cryptocurrencies are not issued or regulated by governments or other central authorities. They are administered using a peer-to-peer network of computers running free and open-source software. By and large, anybody who want to engage is welcome. 

  IS IT SAFE TO INVEST? 

How is crypto safe if no bank or government is involved? It is safe since all transactions are verified using a blockchain technology. A bitcoin blockchain is analogous to a bank’s ledger or balance sheet.

Each currency has its own blockchain, which is a continuous, continually re-verified record of all transactions ever conducted in that currency. In contrast to a bank’s ledger, a crypto blockchain is dispersed over the whole network of a digital currency. It is not controlled by any corporation, government, or third party, and anybody can join. A blockchain is a ground-breaking technology that was made possible just lately as a result of decades of computer science and mathematical invention. 

 WHY SHOULD WE INVEST IN IT? 

Cryptocurrency is based on Metcalfe’s law, which posits that the value of a network is proportional to the square of its node count. The nodes in this diagram represent the number of individuals, while the network represents the type of cash. As a result of the steady flood of people investing in crypto, its value will continue to rise. The cryptocurrency market capitalization is now about $3 trillion and is predicted to reach $100 trillion by the end of the decade. 

My motivation for investing in cryptocurrencies stems from a desire for a long-term, stable source of wealth. Unlike conventional money, the majority of cryptocurrencies have a limited supply that is managed by mathematical algorithms. This effectively limits the power of any political body or government agency to devalue its currency through inflation. Additionally, because to the cryptographic construction of cryptocurrencies, a government agency cannot confiscate tokens without the owner’s consent, therefore concerns such as Hyperinflation, bank failures, and other crisis scenarios would have no effect. 

  ANALYSIS OF THE TOP TEN COINS 

• Bitcoin (BTC)

Over $882 billion in market capitalization 

ABOUT: Satoshi Nakamoto established the first cryptocurrency, Bitcoin (BTC), in 2009. As is the case with the majority of cryptocurrencies, BTC is based on a blockchain, a decentralized database that records transactions across thousands of computers. Bitcoin is secured against hackers by forcing users to solve a cryptographic challenge before to adding transactions to the ledgers. 

HISTORY: As Bitcoin gained popularity, its price skyrocketed. In May 2016, a Bitcoin was worth around $500. A Bitcoin was valued more over $46,000 on Jan. 3, 2022. This is a 9,200 percent gain. 

• Ethereum (ETH)

Over $447 billion in market capitalization 

ABOUT: With its self-executing smart contracts and non-fungible tokens, Ethereum is a cryptocurrency and blockchain platform that programmers like (NFTs). 

HISTORY: Ethereum has likewise experienced remarkable growth. Between April 2016 and January 2022, its price roughly tripled, from $11 to over $3,700. 

• Binance Coin (BNB)

Over $86 billion in market capitalization 

ABOUT: On one of the world’s largest cryptocurrency exchanges, Binance, you may trade and pay fees using the Binance Coin. Binance Coin, established in 2017, has gone beyond its original purpose of facilitating transactions on Binance’s market. It is now capable of being utilized for commerce, payment processing, and even trip reservation. Additionally, it may be exchanged for other cryptocurrencies like as Ethereum or Bitcoin. 

HISTORY: It began at $0.10 in 2017 and increased to over $520 by January 3, 2022, a 520,000% growth. 

• Tether (USDT)

Over $78 billion in market capitalization 

Tether, in contrast to several other cryptocurrencies, is a stable coin, which means that it is backed by fiat currencies such as the US dollar and the Euro. This suggests that Tether’s value should be more stable than the value of other cryptocurrencies, which is why investors favour it. 

• Solana (SOL)

Over $52 billion in market capitalization 

ABOUT: Developed to enable decentralized financial (DeFi) applications, decentralized applications (DApps), and smart contracts, Solana utilizes a novel hybrid proof-of-stake and proof-of-history approach to ensure transactions are processed swiftly and safely. The platform is powered by SOL, Solana’s native cryptocurrency. 

HISTORY: SOL launched in 2020 for $0.77. It was valued around $171 on Jan. 3, 2022, an increase of over 22,000 percent. 

• Cardano (ADA)

Over $44 billion in market capitalization 

ABOUT: Cardano is recognized for pioneering the use of proof-of-stake validation in the cryptocurrency space. Due to the fact that transaction verification is no longer competitive or problem-solving in systems such as Bitcoin, it saves time, energy, and has a positive influence on the environment. Cardano, like Ethereum, powers smart contracts and decentralized applications using its native coin, ADA. 

HISTORY: Cardano’s ADA coin has risen slowly in comparison to other major crypto currencies. In 2017, ADA cost $0.02. On Jan. 3, 2022, it will cost $1.34. This is a 6,600 percent increase. 

• US Dollar Coin (USDC)

Over $42 billion in market capitalization 

USD Currency (USDC) is a stable coin, similar to Tether, in that it is backed by US dollars and aspires for a 1 USD to 1 USDC ratio. USDC is a cryptocurrency powered by Ethereum, and it may be used to conduct global transactions. 

• XRP (XRP) 

Over $39 billion in market capitalization 

ABOUT: XRP may be used to ease the exchange of many currency kinds on that network, including fiat currencies and other major cryptocurrencies. 

  HISTORY: At the start of 2017, XRP was trading at $0.006. As of Jan. 3, 2022, its price had increased to $0.83, a gain of about 13,700 percent. 

•   Terra (LUNA) 

Over $33 billion in market capitalization 

ABOUT: Terra is a blockchain-based payment system for stable coins that maintains the balance of two cryptocurrencies. Stable coinage backed by Terra, such as Terra USD, are anchored to actual currency values. On the other side, Luna is responsible for powering the Terra platform and minting new Terra stable currency. 

Terra stable coins and Luna are driven by supply and demand: When the price of a stable coin surpasses the value of its underlying currency, users are incentivized to burn Luna to make more Terra. When the value of Luna falls in relation to the base currency, people are urged to burn Terra stable coins to create Luna. Luna’s worth increases in lockstep with Terra platform usage. 

HISTORY: Luna’s price increased over 14,300 percent from $0.64 on Jan. 3, 2021, to $92.64 a year later. 

• Polkadot (DOT)

Over $29 billion in market capitalization 

ABOUT: Polkadot aims to unite Blockchains by creating a cryptocurrency network that enables them to communicate with one another. This integration has fueled tremendous growth since Polkadot’s inception in 2020. 

HISTORY: Its price increased almost 925 percent between September 2020 and January 3, 2022, from $2.93 to $30.04. 

Published By : Akshita Katoch

Edited By : Khushi Thakur