Important: This position should not be considered as investment advice. The author focuses on the best coins in terms of actual usage and adoption, not from a financial or investment perspective.
In 2017, the crypto markets set the new standard for simple profits. Almost every piece or tile got amazing returns. “A high tide washes over all boats”, as they say, and the end of 2017 was a deluge. Rising prices have created a positive feedback loop, drawing more and more capital into Crypto. Unfortunately, but inevitably, this runaway market is leading to massive investment. Money has been thrown indiscriminately on all kinds of dubious projects, many of which will not bear fruit.
In the current bearish environment, hype and greed are replaced by critical assessment and caution. Especially for those who have lost money, marketing promises, endless shillings and charismatic oratorios are no longer enough. Well, the basic reasons to buy or hold a coin are paramount once again.
Fundamental factors in the evaluation of a cryptocurrency-
There are a few factors that tend to conquer the hype and price bombs, at least in the long run:
Although the technology of a cryptocurrency business plan or ICO may seem amazing without users, they are just dead projects. It is often forgotten that widespread acceptance is an essential characteristic of money. In fact, it is estimated that more than 90% of the value of Bitcoin is based on the number of users.
While the acceptance of Fiat is entrusted by the State, the acceptance of crypto is purely voluntary. Many factors play into the decision to accept a coin, but perhaps the most important consideration is the likelihood that the coin will be accepted by others.
Decentralization is central to the Push Model of a true cryptocurrency. Without decentralization, we are a bit closer to a Ponzi scheme than an actual cryptocurrency. Trust in individuals or institutions is the problem that a cryptocurrency tries to solve.
If dismantling a coin or a central controller can change the transaction log, you are questioning its basic security. The same goes for parts with untested code that haven’t been thoroughly tested over the years. The more you can trust the code to work as described, regardless of human influence, the greater the security of a coin.
Valid coins strive to improve their technology, but not at the expense of security. Real technological progress is rare because it requires a lot of experience and also wisdom. Although there are always fresh ideas that can be screwed on, if doing so jeopardizes or criticizes the original purpose of a coin, the point is lost.
Innovation can be a difficult factor to assess, especially for non-technical users. However, if a currency code is stuck or does not receive updates that address important issues, it may be a sign that the developers are weak in ideas or motivation.
The economic incentives inherent in a currency are easier for the average person to understand. If a coin had a large pre-mine or an ICO (initial share offering) team had a significant portion of the tokens, then it’s pretty obvious that the main motivation is profit. By buying what the team offers, you play your game and enrich it. Be sure to provide tangible, reliable value in return.
5 cryptocurrencies to buy in 2018
There has never been a better time to reassess and balance a crypto portfolio. Building on its strong foundation, here are five pieces that I think are worth watching or perhaps buying at their current depressing prices (which, just a word of caution, could go lower).
#1. Bitcoin (due to its decentralization)
Number one belongs to Bitcoin (BTC), which remains the market leader in all categories. Bitcoin has the highest price, the widest assumption, the most security (due to the phenomenal energy consumption of Bitcoin mining), the most famous brand identity (forks have tried to be appropriated), and the largest part of active and rational development. It is also the only piece to date that is represented in the traditional markets in the form of Bitcoin futures trading on the US CME and CBOE.
Bitcoin is still the main engine; The performance of all other parts is highly correlated with the performance of Bitcoin. My personal expectation is that the gap between Bitcoin and most if not all other parties will widen.
Bitcoin has several promising innovations in the pipeline that will soon be installed as additional layers or soft forks. Some examples are the Flash system (LN), the tree, the Schnorr signatures, Mimblewimbbleund and much more.
In particular, we plan to open up a new range of applications for Bitcoin, as it enables large-scale microtransactions and secure, instant payments. LN is becoming more stable as users test its different possibilities with real Bitcoin. As it becomes more user friendly, it can be assumed that it will greatly benefit from Bitcoin adoption.
#2. Litecoin (for its persistence)
Litecoin (LTC) is a clone of Bitcoin with a different hash algorithm. Although Litecoin no longer has the anonymity technology of Bitcoin, startling reports have shown that Litecoin adoption in dark markets is now second only to bitcoin. Although a currency I have much better suited to the role of acquiring illegal goods and services, perhaps this comes as a result of Litecoin’s longevity: it was released in late 2011.
Another factor in Litecoin’s favor is that it integrates Bitcoin SegWit technology, which means that Litecoin is LN-ready. Litecoin can benefit from an atomic chain swap. In other words, secure peer-to-peer currency trading without the involvement of third parties (ie, the exchange). Since Litecoin keeps its code largely in sync with Bitcoin, it is well positioned to benefit from Bitcoin’s technical progress.
#3. Ethereum (due to smart contracts)
Ethereum (ETH) has some major problems right now. First of all, governments are attacking ICOs, and with good reason: many have turned out to be fraudulent or bankrupt. Since most ICOs run on the Ethereum network as an ERC 20 token, the ICO craze has brought a lot of value to Ethereum in recent years. If the proper rules are taken to protect investors, Ethereum project scams can claim some legitimacy as a crowdfunding platform.
The second big problem facing Ethereum is the delayed transition to a new hybrid battery and work detection system. Ethereum mining GPU is currently profitable, but Bitmain has just announced Ethereum ASIC minor, which will likely have an impact on the bottom lines of GPU miners. Whether this will change the POW and how successful this change will be remains to be seen.
If Ethereum can survive these two main issues, regulation and mining, it will have shown great resilience. Otherwise, there are several competing coins following its shadow, such as Ethereum Classic (etc), Cardano (ADA), and EOS.
#4. Monero (for your anonymity)
Although its adoption in the dark markets is not all that could be expected, I (XMR) is still the privacy of the Prime Minister. His reputation and market capitalization still outpace those of his rivals, and for good reason.
The Monero code requires less trust than Zcash’s “loyal” key ceremony, and it got off to a fair start, unlike Dash. That Monero recently changed its Pow to defeat the development of a small ASIC for its algorithm confirms the commitment of the decentralization mining piece. A significant drop in the hash rate is due to the new version, which is constantly being reported against ASICs. This could also be an opportunity for GPUs and even lesser CPUs to talk to me. The new version of Monero, 0.12, also includes other improvements that show that Monero continues to grow along sensible lines.
#5. iPRONTO (A decentralized incubation platform)
iPRONTO is an Ethereum chain incubation platform dedicated to investors looking for a safe and reliable platform to invest in new ideas and future innovators who can present their ideas and receive feedback from users, subject matter experts on the practice and implementation of derivative ideas.
The ideas of the innovators are supported as the NES in Smart Contract format will be signed between the expert platform and the client if the client’s business idea is submitted to the Committee for examination and registration on the platform. The idea will not be published to all users on the public platform of the chain, but only to selected members of the target community who are willing to sign the smart contract to keep the idea confidential.