When the Reserve Bank of India banned cryptocurrency trading, the supreme court came down heavily on them and struck down the ban, making the virtual currency transferrable and storable. Although not accepted as legal tender, the presence of cryptocurrency in India and other countries slowly opening up to this concept may mean additional capital gains taxes for the trade of digital currencies, but a complete ban on trade and storage looks quite unlikely at this point of time.
There are many cryptocurrency types in the market, and some, such as Bitcoin, are being chosen by investors that place the valuation and future scope of cryptocurrencies in the same bracket as gold in the market. But with so many cryptocurrency exchanges popping up in India off late with so many currencies to choose from, it can get awfully hard to pick one. Which is the best cryptocurrency to invest in? See the top 10 below to find out.
1. Ethereum
The second-largest cryptocurrency based on market capitalization, Ethereum is, according to their website, an “open-source platform for decentralized applications”. Unlike the likes of Bitcoin, Ethereum is not so much a currency as it is a software development and computing platform.
Developers can write their code for their applications developed in the programming language “Ethereum” which runs on blockchain. This makes applications highly secure against fraud and prevents downtime. Third-party interferences are completely avoided. The currency is preferred over BTC since it can be acquired within a quarter of a minute as opposed to around ten minutes needed for Bitcoin.
What gives it a further edge over Bitcoin is that there are far more units of the Ethereum token in circulation compared to Bitcoin. The best cryptocurrency to invest in may have been Bitcoin in the past few years, but with dwindling BTC supply, high mining time, and the ever-increasing volatility, Ether
The token used for the Ethereum platform is known as ether and can be used by developers on their applications as well as by non-developers to make purchases wherever cryptocurrencies are accepted. It is used as a means to eliminate middlemen, such as a substitute to Apple’s iOS store. You can directly make contracts with companies and developers without the need to involve any intermediary organizations or persons that may commission you for their services.
The scope of this crypto-based blockchain development hasn’t gone unnoticed, with tech giant Microsoft announcing a partnership with ConsenSys to offer Ethereum Blockchain as a Service (E-BaaS) to provide Enterprise clients a complete cloud-based blockchain development environment on MS Azure. The CME group is all set to list Ethereum futures on February 8 subject to approval from regulators. One future contract will be equivalent to 50 ETH.
Ethereum is also expected to upgrade to Ethereum 2.0 this year. This will mean conversion to a ‘proof of stake’ model, no mining needed, and sharding, which will give increased scalability, enhance transaction speeds and be able to support millions of concurrent users seamlessly.
2. Bitcoin
Regardless of how often you update yourself with cryptocurrency news, you’ve heard of the currency that it all began with – the Bitcoin, created by Satoshi Nakamoto. That it was the first of its kind also means that it was the simplest of all – it had no competition to worry about and no feedback to evolve from. Once upon a time synonymous with the term cryptocurrency itself, they rule the market today.
The biggest advantages with the BTC are lower transactional fees, wide acceptability, decentralized operation mechanism (as is with every cryptocurrency), and its security. Roughly, only 2.5 million out of a total of 21 million bitcoins are left, which has pushed people to mine, earn and trade in BTC as fast as possible due to the fear of missing out.
The biggest advantage of using bitcoin tokens is that spenders need not pay any commission to middlemen or middle organizations. Mundane, repetitive bank transactions such as making money deposits, withdrawals, payments, transfers that earn the banks a commission will soon become obsolete.
Top companies like IBM and Gemini are investing heavily in this technology, with IBM already having invested around USD 200 million to integrate IBM cloud and hyper ledgers into their systems. Its biggest advantage is its ability to allow verifiable and secure transactions despite storing every transaction on a public ledger. This will play a major role in the coming years as fraudulent agents find more ways to siphon off real money and force people to consider switching to mobile or virtual money.
3. Polkadot
You’re living under a rock if you’ve been following cryptocurrency news but haven’t heard of this one yet – it’s gotten that popular. Alongside Ethereum, Polkadot is all set to disrupt finance in the next decade, having established itself as a pioneer of decentralized finance (Defi). The biggest industry advantage for Polkadot is its interoperability – it facilitates all kinds of cross-blockchain transfers of assets or data and not just tokens.
Launched as recently as 2017, how exactly does this infant cryptocurrency (as opposed to BTC or Ethereum) stand out? For starters, the project was conceived by Gavin Wood, the co-founder of Ethereum. It evolves and adapts to emerging technologies by updating itself through self-modification of its protocols, making hard forks needless.
The idea of this currency revolves around heterogenous sharding so that every shard of data (workload) is unique but connected like chains. These chains, known as parachains, can mint Polkadot tokens, known as DOT tokens.
They are also responsible for token transfers and external chaining via bridges. These bridges act as the linkup between Polkadot and other cryptocurrencies. All this is secured through the main guarding chain, known as the Polkadot Relay Chain.
Its heterogeneous nature has opened doors for young startups and smart investors to rely on this unique technology to invest in and work with more than one cryptocurrency at a time, so if you’re planning for twenty years down the line, this is the best cryptocurrency to invest in. Companies such as Acala, Moonbeam, and Chainlink are collaborating or working in some way by completely leveraging their business with Polkadot.
This is as good a time as any to make a move and invest.
4. Cardano
When creators develop something new, it could be potentially good. But with Cardano, the world’s first-ever peer-reviewed cryptocurrency, you can rest assured its creation was led by experts of the field. Several academicians and blockchain scientists from renowned universities such as the University of Edinburgh and the Tokyo Institute of Technology review its protocols before they’re released into the market.
As far as cryptocurrency types or generations go, Cardano is the third generation, meaning its protocols are derived from Gen 1 (BTC) and Gen 2 (ether) cryptocurrencies and further enhanced. The platform consists of two layers, the CSL (Cardano Settlement Layer), which settles Cardano-token-based transactions, and the control layer, which is still under-development. Like Ethereum, this layer will be responsible for smart contracts, making it another DeFi-based cryptocurrency to invest in.
This is preferred by beginners over the likes of Bitcoin because the mining time is lesser and the energy use is less, too. This is due to its mining algorithm – Ouroboros that takes into consideration, not just mining in general but also approvals from slot leaders and stakeholders. One of the cons for this currency is that sharding, which is common among the top cryptocurrencies in the market, will be a viable option here only after a few years.
To reiterate, this is one currency for the future. For now, investors are advised to back the team creating this, and the expert peers reviewing this. The token ADA is used here and is expected to reach all-time highs in 2021. Some ADA investors expect a 2000% increase in prices. Companies are viewing Cardano as a solution to many real-life problems. For instance, the products Atala Scan and Atala Trace are used against product counterfeiting and for supply chain tracking by IOHK and EMURGO respectively.
5. Chainlink
Another finance-based blockchain ecosystem in its own right, Chainlink is set to disrupt finance with its ever-growing list of DeFi possibilities. It has established itself as an industry standard for decentralized oracle solutions as the fastest-growing DeFi ecosystem in the world with a current valuation of over 4 Billion Dollars.
Owing to this, Cryptex has launched its smart contracts token TCAP backed by the Chainlink framework. The oracle network enables trustless data streams which are crucial for smart contract triggering. Ethereum already has a smart-contracts based core, so how does Chainlink stand out? The answer is security incentives.
Chainlink offers LINK, its token, to data providers that can ensure the validity of each smart contract. This is similar to how BTC transaction verifiers are paid for each verification, but with smart contracts seen as the future and their nature making them heavily reliant on real-world data, Chainlink surpasses Ethereum in the factor space on paper.
Various collaborations have resulted from this Decentralized Oracle Network (DON) mechanism, such as block pass integrating with Chainlink to provide on-chain, global KYC data across blockchain platforms. For those in the dark, block pass is a digital identity verification provider that is seen as the future of payment gateway validations in the future.
Another major collaboration is in the VR domain. South Korea-based Division Network has announced an integration with Chainlink framework to ensure provably-fair rewards for their random rewards distribution scheme. They’ve also bought accurate NFT item costing and added security with this integration.
6. Ferrum Network
By now, you know one thing for certain – DeFi ecosystems are the future, but does that mean flat currencies shall become obsolete? This looks impossible up until at least the next century. This is where Ferrum Network comes in. This is highly interoperable, and when we say interoperable, we do not imply just cross-blockchain interoperability, we also imply flat-to-crypto transactional support.
It supports link-based swapping, which allows holders too, in simple terms, make transfers at almost non-zero rates over chat or social media applications. Another noteworthy feature of Ferrum is that it connects chains to transfer assets between the Ethereum network and Binance Chain.
The token FRMx, launched by Ferrum Network will help holders gain “attractive and sustainable yields” due to its long-term sustainability design. In Q1 2021, Ferrum is set to launch the Public Test Net and the Infinity Index to boost its position in the market. Some of the most popular use cases include being used as an anti-spam measure, in transactions on Ferrum DEX and its decentralized wallet, and Kudi Exchange (a flat gateway in Western Africa), among others.
7. DuckDAO
Gone are the days of bank loans for businesses and investment bankers minting money to invest and buy stakes in exciting new startups. DuckDAO is the first-of-its-kind community fund providing platform.
In simple terms, the community of DuckDAO, referred to as ‘Ducks’ are a group of investors looking to fund their money into blockchain startups with a long-term goal in mind. There are several specific groups of these investors, and the entry qualification for each of these groups is a fixed number of DuckDAO’s tokens – the DuckDaoDime (DDIM).
This is achieved through the DuckDAO Liquidity Pool (DLP) where dealings are done for DDIM against liquidity. Blockchain project owners seeking financial support have three options to choose from – Project Token Purchase, Borrow, or Fixed Free Mode.
Project Token Purchase is where the DLP (the group of investors) buys DDIM tokens and to provide liquidity to projects. DLP can also borrow a token against collateral to provide liquidity, or simply pay a fixed service fee for liquidity for a short duration listing. There are tons more advantages such as special rewards, multipliers, and more.
Projects can seek liquidity in either stage of project development based on DuckDAO’s three-tiered approach in project involvement. The DLP community can be involved or aloof based on the selection of these tiers. Great companies such as Bondly, Base Protocol, and DeFiPie are a part of this and are reaping the rewards. YouTubers like Ivan on Tech and Boxmining have partnered with DuckDAO, making it one to watch out for in the future.
8. Yfdai Finance
If you thought that the likes of Ethereum or Cardano were revolutionizing the Defi space, you might just be in for a shock. When they added the word ‘Finance’ to their company name, Yfdai Finance meant it as much as one could imagine.
Staking, lending, borrowing, insurance, audited contracts, and locked tokens, farming, and a launchpad of the ecosystem acting as a service provider – you name it, they do it. While most of these features are all set to roll out in 2021, staking and farming have been launched and are already creating ripples in the crypto markets.
By Q1 of 2021, they plan to roll out a full suite of mobile apps, their very own wallet, partnerships with major industries, and Further Exchange listings. By Q2 same year, they plan to launch an entire eCommerce platform based on their Defi ecosystem and also issue debit cards to their customers. The total supply of their tokens is limited to 21,000 yfdai, out of which 37% are already in circulation despite their very recent beginnings. This may not directly be the best cryptocurrency to invest in, but is sure a great platform where you can avail of multiple services.
Their noteworthy partnerships include the following
- The Ferrum Network: to compliment staking and support the launchpad technical services.
- C.I.P.A (Crypto Investor’s Protection Alliance): to ensure security, trust, and transparency
- Dextools: to provide advanced features to users
- DuckDAO: as a fundraiser – where DuckDAO has delegated yfdai’s SafeSwap as one of their duck approved exchange partners.
- The Foundry: for the promotion of SafeSwap through a cooperation agreement.
9. Aave
It is an “open-source, non-custodial liquidity protocol for earning interests on deposits and borrowing assets”. In simple terms, it is a decentralized lending system that incorporates the same principles of bank loans. It runs on the Ethereum blockchain and works on a trustless mechanism.
A distributed network of virtually set up computers manage smart contracts that run executable blockchain codes to lend funds. Once you post collateral, you may borrow from any of the 17 cryptocurrencies available on their platform, including all major ones like BTC and ETH.
As a borrower, you receive funds in the form of Aave Interest Bearing Tokens or aTokens for short. These aTokens are valued at 1:1 for the collateral you post, so you can borrow only as much as you’ve posted your assets. These aTokens accrued the interest on each loan so lenders can watch in real-time as their interest rate is credited to their wallets every second.
They have collaborated with most of the major Wallets, Indexes, Rebalancers, and blockchain debit card merchants across the globe. They are further planning to introduce more features like issuance of debit and credit cards, instant loans, and more in the coming year.
10. Synthetix Network Token (SNX)
Synthetic Network Token is considered to be the backbone of financial securities trading where the underlying assets are bonds, commodities, or flat currencies. When a user adds an asset as collateral to the liquidity pool of Synthetix, they earn rewards in the form of their SNX tokens.
Once assets are locked in contracts, issuance of synthetic assets (synths) is facilitated through their collateral pool. Users can even provide SNX as collateral since all synthetic assets on their liquidity pool are backed 750% by SNX tokens. Apart from this, users may also trade and stake in SNX overtime to gain long-term profits.
Their plans include launching synths on Synthetix.Exchange with a self-balancing mechanism. For now, users can choose either to trade, stake, or use the liquidity pool to lend/borrow assets and crypto tokens.
Final Word
That was a cryptocurrency list curated for you with intensive research to cover various aspects of each of the top 10 best cryptocurrency People with an exotic, international taste and a vision of the future are investing in the crypto market owing to the rise in BTC prices, especially during the pandemic induced lockdown across the globe.
That the price of cryptocurrency such as Ethereum increased by a whopping 350% during 2020 – a year most would prefer erasing from their memories speaks a lot about the positive scope of investment in the number 1 ranked currency of this list. There are several cryptocurrencies to invest in, and most of them are recent launches with a great leadership group at the helm – keep an eye out for the latest cryptocurrency news to stay on top of the game.
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