In the previous episode, we demystified certain terms associated with Cryptocurrencies & spoke about how Coinbase’s IPO could be a massive moment in the history of Cryptos.
In recent weeks, there was a meltdown in the Crypto world - with all major cryptos taking a big hit on the back of China banning banks/payment firms from processing or entering into services related to cryptocurrency transactions.
In this episode we spoke about some lesser known Cryptocurrencies and their use cases.
#1 Cardano (ADA)
Cardano is a decentralized blockchain and it’s token is called ADA, which uses the Proof of Stake mechanism (PoS).
[Check out what’s the difference between Proof of Stake vs Proof of Work in this article]
Cardano was founded by the co-founder of Ethereum (Charles Hoskinson) and it was created to serve as an alternative to Ethereum.
It also powers ‘smart contracts’ - which in simple terms is a ‘program’ or a ‘transaction protocol’ which automatically executes T&Cs of an agreement/contract. No human element is required.
The organizations behind Cardano have released 3 products:
Atala PRISM
Atala SCAN
Atala Trace
Atala PRISM is marketed as an Identity Management Tool that can be used to provide access to services. For eg. it can be used to verify credentials to open a bank account or to verify eligibility for government aid.
Atala SCAN & Atala Trace are being used to trace a product’s journey through a supply chain.
Cardano has the potential as per some analysts - to become the next Bitcoin.
#2 Ripple (XRP)
Ripple has a simple objective - to make cross border transactions easy. It is building a payments and exchange network (RippleNet) on it’s blockchain (XRPL)
It wants to connect banks, payment providers and digital asset exchanges, enabling faster and cost-efficient global payments.
Ripple’s blockchain (XRPL) is open source - meaning that anyone can contribute and improve the code.
Also, it doesn’t use the Proof of Work mechanism - and doesn’t rely on the process of mining to verify transactions. It has it’s own customized consensus algorithm (called RPCA)
The RippleNet offers 3 products to banks/financial institutions:
xRapid
xCurrent
xVia
xRapid is a liquidity solution that uses the XRP cryptocurrency as a bridge between multiple fiat currencies, xCurrent allows cost effective real time payments between financial institutions & xVia allows integration of RippleNet participants.
Ripple, can be considered as THE cryptocurrency for global payment solutions to banks/FIs - and it’s potential, is massive!
#3 VeChain
VeChain powers ‘Blockchain as a Service or BAAS’ and is designed to be used by both small & big businesses.
VeChain’s public blockchain is called the VeChainThor - and it provides real world blockchain solutions ranging from supply chain management, anti-counterfeiting, tracking carbon emissions & decentralized voting - to name a few.
The VeChainThor blockchain uses the Proof of Authority mechanism to validate transactions - which gives the power to a few selected nodes in the blockchain. Also, VeChain app users don’t need to hold any crypto to perform transactions - which makes the UX really convenient.
VeChain has two tokens:
VET (VeChain Token) which is used to make financial transactions on the blockchain & trades on digital asset exchanges.
VTHO (VeThor Token) which is a ‘energy token’ used to conduct transactions - however this token doesn’t trade & can’t be used for market speculation.
Enterprises are increasingly adopting ‘Blockchain as a Service’ for various use cases and as its applications grow - so will VeChain.
#4 Polkadot (DOT)
Now, we’ve seen how every Cryptocurrency has it’s own Blockchain - which records the transactions and powers other use cases. And, this got me wondering - can Blockchains of different Cryptos be linked together?
That’s exactly what Polkadot is doing.
It connects different blockchains, allowing them to communicate with one another - which could lead to exchange of data and open up a lot of different applications.
Imagine if Bitcoin’s blockchain could interact and exchange information/data with Ethereum’s blockchain - a lot of cross chain applications, products & services could be built.
#5 COTI
COTI is one of those crypto networks that wants to become the ultimate powergrid of payments.
It has an application called COTI pay - which can process payments both online & offline - powering debit cards, credit cards, payments in fiat currency and cryptocurrency. COTI will issue its own credit & debit cards.
It also lets other businesses create ‘stable coins’ - which isn’t affected by the Crypto market. For eg. Amazon could create its own ‘stable coin’ for it’s customers to transact in - there’s a lot of potential in this ecosystem.
To end the episode, we spoke about certain risks of putting your money into Cryptocurrencies - and how you should abstain from using your emergency funds/savings to invest in Cryptos.
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