Important: This position should not be taken as investment advice. The author focuses on the best coins in terms of actual use and adoption, not financial or investment.
In 2017, crypto markets set a new standard for simple profits. Almost every piece or chip brought incredible profits. As they say, “A high tide floats all boats” and the end of 2017 was a flood. The rise in prices has created a positive feedback cycle, which is attracting more and more capital to Crypto. Unfortunately, but inevitably, this fast-moving market leads to a huge investment. Money has been thrown indiscriminately into all sorts of dubious projects, many of which will not bear fruit.
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In the current bear environment, hype and greed are being replaced by critical appraisal and caution. Marketing promises, endless shillings and charismatic oratories are no longer enough, especially for those who have lost their money. Well, the main reasons to buy or hold a coin are once again superior.
Key factors in cryptocurrency valuation
There are some factors that tend to beat the hype and price pumps, at least in the long run:
Although the technology of cryptocurrency or ICO business plan may seem amazing without users, they are just dead projects. It is often forgotten that widespread acceptance is an important feature of money. In fact, it is estimated that more than 90% of Bitcoin’s value depends on the number of users.
While the adoption of fiat is mandated by the state, the adoption of cryptography is purely voluntary. Many factors go into the decision to accept a coin, but perhaps the most important consideration is the likelihood that others will accept the coin.
Decentralization is essential to the I push Model of true cryptocurrency. Without decentralization, we’re a little closer to a Ponzi scheme than a real cryptocurrency. Trust in individuals or institutions is a problem that cryptocurrency tries to solve.
If hacking a coin or a central controller can change the transaction record, it calls into question its basic security. The same goes for parts with unverified code that haven’t been thoroughly tested over the years. The more you can rely on the code working as described regardless of human influence, the more secure the coin is.
Trusted coins strive to improve their technology, but not at the expense of security. True technological progress is rare because it requires great experience as well as wisdom. Although there are always fresh ideas that can be distorted, doing so misses the point if it is posed by weaklings or critics of the coin’s original purpose.
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Innovation can be a difficult factor to evaluate, especially for non-technical users. However, if a currency code is stagnant or doesn’t receive updates that address important issues, it could be a sign that the developers are low on ideas or motivation.
The economic incentives inherent in currency are easier for the average person to understand. If a coin has a large pre-mine or ICO (initial portion offering) where the team holds a significant portion of the chips, it is quite clear that the main motivation is profit. By buying what the team has to offer, you play your own game and enrich it. Instead, be sure to provide tangible and reliable value.
5 cryptocurrencies to buy in 2018
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There has never been a better time to re-evaluate and rebalance your crypto portfolio. Based on their solid fundamentals, here are five pieces that I think are worth buying at the current depressed prices (just a warning, they may drop).
#1. Bitcoin (due to decentralization)
Number one belongs to Bitcoin (BTC), which remains the market leader in all categories. Bitcoin has the highest price, the widest speculation, the most security (due to the phenomenal energy consumption of bitcoin mining), the most popular brand identity (forks have tried to match) and the most development Active and rational. It is also the only piece represented in traditional markets in the form of Bitcoin futures trading on the American CME and CBOE.
Bitcoin remains the main engine; The performance of all other parts is highly correlated with Bitcoin performance. My personal expectation is that the gap between bitcoin and most if not all other parts will widen.
Bitcoin has several promising innovations in its pipeline that will soon be installed as additional layers or soft forks. Examples Flash system (LN), wood, Schnorr signatures Mimblewimbleund more.
In particular, we plan to open up a new range of applications for Bitcoin as it enables large-scale, microtransactions and instant and secure payments. LN is increasingly stable as users test its various capabilities with real Bitcoin. As it becomes easier to use, it can be assumed that Bitcoin will benefit greatly from its 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, amazing reports have shown that Litecoin is now the second only bitcoin to be accepted on dark markets. Although it is a currency that I am more suited to the role of obtaining illegal goods and services, perhaps this is a consequence of Litecoin’s longevity: it was launched in late 2011.
Another factor in Litecoin’s favor is that it integrates Bitcoin SegWit technology, which means that Litecoin is made for LN. Litecoin can benefit from the exchange of atomic chains. In other words, secure peer-to-peer trading of currencies without the involvement of third parties (i.e. exchanges). Litecoin is well-positioned to benefit from Bitcoin’s technical progress, as it largely syncs its code with Bitcoin.
#3. Ethereum (because of smart contracts)
Ethereum (ETH) is currently experiencing some major problems. First of all, governments are reaching out to ICOs, and rightfully so: many have turned out to be either scams or bankrupt. Since most icos operate as ERC tokens 20 on the Ethereum network, the ICO craze has added a lot of value to Ethereum in recent years. Ethereum projects can claim some legitimacy as a scam crowdfunding platform if proper regulations are adopted to protect investors.
The second major challenge facing Ethereum is the delayed transition to a new hybrid work and battery detection system. Ethereum mining GPU is profitable right now, but Bitmain just announced an Ethereum ASIC minor, which could affect the bottom lines of GPU miners. It remains to be seen whether this will change the captives and how successful this change will be.
If Ethereum can survive these two major challenges – regulation and mining – it will have shown great resilience. Otherwise, there are several competing currencies following their shadows, such as Ethereum Classic (etc.), Cardano (ADA), and EOS.
#4. Monero (for its anonymity)
I (XMR) remains a Prime Minister’s secret, though not all are expected to be accepted on the black markets. Its reputation and market capitalization are still higher than those of its competitors – and for good reason.
Monero code Zcash “faithful” main ceremony requires little faith, and Dash in contrast was a fair start. Monero recently modified Pow to defeat the development of a small ASIC for its algorithm, confirming the commitment of the mining decentralization piece. A significant decrease in hash rate is due to the new version that is consistently reported against the ASIC. This could also be an opportunity for GPUs and even small CPUs to come back to me. Monero’s new version, 0.12, includes other improvements that show Monero continues to grow along sensitive lines.
#5. iPRONTO (decentralized incubation platform)
The iPRONTO incubation platform is an Ethereum chain, to investors looking for a safe and reliable platform to invest in new ideas, and to future innovators who can present their ideas and receive feedback from users, experts in the field of practice and implementation of acquired ideas.
In the event that the client’s business idea is sent to the Committee for examination and registration on the platform, an NES in Smart Contract format will be signed between the expert platform and the client, so the ideas of innovators are supported. The idea will be published on the chain’s public platform, not to all users, but only to selected members of the target community who are willing to sign the Smart contract to protect the privacy of the idea.