Important: This position should not be considered as investment advice. The author focuses on the best currencies in terms of actual use and adoption, not from a financial or investment perspective.
In 2017, cryptographic markets set the new standard for simple profits. Almost every piece or chip produced incredible performance. “A rising tide launches all ships,” as they say, and the end of 2017 was a deluge. Rising prices have created a positive feedback cycle, attracting more and more capital to Crypto. Unfortunately, but inevitably, this rampant market leads to a massive investment. The money has been thrown indiscriminately into all sorts of dubious projects, many of which will not bear fruit.
In the current bearish environment, hype and greed are replaced by critical appraisal and prudence. Especially for those who have lost money, marketing promises, endless shillings and charismatic oratories are no longer enough. Well, the basic reasons to buy or keep a coin are Paramount once again.
Fundamental factors in the evaluation of a cryptocurrency.
There are some factors that tend to conquer advertising and price bombs, at least in the long run:
While the technology of a cryptocurrency or an ICO business plan may seem amazing without users, they are just dead projects. It is often forgotten that widespread acceptance is an essential feature of money. In fact, it is estimated that more than 90% of the value of Bitcoin depends on the number of users.
While the state trusts Fiat’s acceptance, acceptance of the cryptography is purely voluntary. Many factors play into the decision to accept a currency, but perhaps the most important consideration is the likelihood that others will accept the currency.
Decentralization is essential for the I push model of a true cryptocurrency. Without decentralization, we are a little closer to a Ponzi scheme than a real cryptocurrency. Trust in people or institutions is the problem: a cryptocurrency tries to solve it.
If the dismantling of a currency or a central controller can change the transaction log, it is questioning its basic security. The same applies to parts with untested code that have not been thoroughly tested over the years. The more you can count on the code to work as described, regardless of human influence, the greater the security of a currency.
Valid currencies strive to improve their technology, but not at the expense of security. Real technological progress is rare as it requires a lot of experience and also wisdom. While there are always fresh ideas that can be caught, if doing so poses vulnerabilities or criticizes the original purpose of a coin, no idea is made.
Innovation can be a difficult factor to assess, especially for non-technical users. However, if a currency code is stagnant or does not receive updates that address major issues, it may be a sign that developers are weak in terms of ideas or motivations.
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 piece offering), the team had a significant portion of tokens, it is obvious that the main motivation is profit. When you buy what the team offers, play your game and enrich it. Be sure to provide tangible and reliable value in return.
5 cryptocurrencies to buy in 2018
There has never been a better time to re-evaluate and balance a cryptographic portfolio. Based on their solid foundation, here are five pieces that I think are worth keeping or that they might buy at their current depressing prices (which, just by warning, could go down).
# 1. Bitcoin (for decentralization)
Number one belongs to Bitcoin (BTC), which remains the market leader in all categories. Bitcoin has the highest price, the broadest assumption, most of the security (due to the phenomenal energy consumption of Bitcoin mining), the most famous brand identity (forks have tried to be suitable) and most of Active and rational development. It is also the only piece so far represented in traditional markets in the form of Bitcoin futures trading in the US CME and CBOE.
Bitcoin remains 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 parts, will widen.
Bitcoin has several promising innovations in the pipeline that will soon be installed as additional layers or soft forks. Examples are the Flash (LN) system, the tree, Schnorr Mimblewimbleund signatures and more.
In particular, we plan to open a new range of applications for Bitcoin, as it allows for large-scale microtransactions and instant and secure payments. LN is becoming more stable as users test their different possibilities with real Bitcoin. As it becomes easier to use, it can be presumed that it will greatly benefit from the adoption of Bitcoin.
# 2. Litecoin (for its persistence)
Litecoin (LTC) is a Bitcoin clone with a different hash algorithm. Although Litecoin no longer has the technology of anonymity of Bitcoin, surprising reports have shown that the adoption of Litecoin in the dark markets is now the second, the only bitcoin. While a currency that I hold much more appropriate for the role of acquiring illegal goods and services, it may present itself as a result of Litecoin’s longevity: it was launched in late 2011.
Another factor in favor of Litecoin is that it integrates Bitcoin SegWit technology, which means Litecoin is ready for LN. Litecoin can benefit from an exchange of atomic chains. In other words, secure currency trading between equals without the involvement of third parties (i.e. stock 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 issues right now. First of all, governments are busting ICOs and rightly so many have turned out to be fraudulent or bankrupt. Because most icos operate 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 right rules are taken to protect investors, scams from Ethereum projects may claim some legitimacy as a crowdfunding platform.
The second major problem facing Ethereum is the delayed transition to a new battery detection system and hybrid jobs. The 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. It remains to be seen whether this will change the prison of war and how successful this change will be.
If Ethereum can survive these two big problems, regulation and mining, they will have shown great resilience. Otherwise, there are several competing currencies that follow its shadows, such as Ethereum Classic (etc), Cardano (ADA) and EOS.
# 4. Monero (for their anonymity)
While it could not be expected to be adopted in the dark markets, I (XMR) remains the prime minister’s privacy. Its reputation and market capitalization remain above those of its rivals, and for good reason.
Monero’s code requires less trust than Zcash’s “loyal” key ceremony and had a fair start, unlike Dash. That Monero recently switched from Pow to defeat the development of a small ASIC by its algorithm confirms the commitment to mining decentralization. A significant drop in the hash rate is due to the new version, which is constantly reported against ASIC. This could also be an opportunity for the GPU and even for smaller CPUs. The new version of Monero, 0.12, also includes other improvements that show that Monero continues to grow following delicate lines.
# 5. IPRONTO (A decentralized incubation platform)
iPRONTO is an incubation platform of the Ethereum chain dedicated to investors looking for a safe and reliable platform to invest in new ideas and innovative innovators who can present their ideas and receive opinions from users, experts in the practice and implementation of ideas derivatives.
The ideas of the innovators are supported, as the NES in Smart Contract format will be signed between the expert platform and the customer if the business idea of the customer to the Committee for examination and registration on the platform. The idea will not be published to all users of the chain’s public platform, but only to selected members of the target community who are willing to sign the Smart contract to maintain the confidentiality of the idea.