2017 has become the year of cryptocurrencies. In January, the cumulative market capitalization of all digital currencies did not exceed $ 18 billion. In just 12 months, it jumped more than 3300% to 613 billion. And although the market had to go through a decline at the beginning of the year, and now its capitalization is about 450 billion dollars, this is perhaps the best result ever for a limited asset class.
Such rapid growth is often attributed to the interest in the technology underlying most cryptocurrencies. Blockchain is a digital, decentralized register in which data about all transactions are stored. It eliminates the need for financial intermediaries, such as banks.
Bitcoin (Bitcoin) first drew public attention to the blockchain, but it was ether (ETH / USD) - the second in terms of capitalization of the cryptocurrency - that led to its evolution. More than 200 companies and organizations from around the world united in the Enterprise Ethereum Alliance. His goal is to test the work of the Ethereum blockchain in various industries with the help of small pilot projects.
Now the capitalization of the air exceeds 89 billion dollars. In other words, it cannot be called a hidden treasure. Perhaps it is time to forget about the air and Bitcoin and pay attention to cryptocurrency with high growth potential. Here are eight of them:
1. Ripple
Among the largest cryptocurrencies (with a capitalization exceeding 10 billion dollars), Ripple (XRP / USD) deserves special attention among enthusiasts due to the incredible speed of work and the growing number of partner companies.
An analysis of the speed of the work conducted by the website HowMuch.net showed that the Ripple blockchain is capable of processing up to 1500 operations per second. This is only 10% of the speed of the Visa payment system, but more than 200 times higher than the bandwidth of Bitcoin and almost 75 times faster than the air. Of course, speed is not everything. The processing time of the blocks is important, but even the existing advantages make Ripple an attractive option for financial companies (which it primarily focuses on).
In November, Ripple, together with American Express and Banco Santander, conducted a test of a service that allows making payments via the American Express international network using the blockchain. The money sent to the accounts of the British unit of the bank Santander, arrived in a few seconds instead of a few days.
In January, Ripple and MoneyGram International announced a deal that will allow MoneyGram to use XRP tokens to speed up transactions and reduce costs. Although cryptocurrency has a rather high capitalization (41 billion dollars), the agreements listed above show that the Ripple blockchain is attractive for large financial companies and its rate may increase.
2. Qtum
Qtum has the advantage of combining the basic Bitcoin infrastructure with the Ethereum virtual machine (that is, the advantages of the two most popular cryptocurrencies are borrowed). The result is a blockchain with extremely wide customization options - developers are confident that many companies will want to use it. Last month, Qtum signed a cooperation agreement with two major Chinese firms (the Qtum Foundation expects to announce five more key partnerships this year).
The first partner was 360 Finance - a subsidiary of the private company Qihoo 360. She owns the 360 Search search service with the third largest market share in China. Under the terms of the agreement, the 360 Blockchain Research Center, the BTN Foundation and the Qtum Foundation form a sort of laboratory for developing next-generation blockchain-based solutions.
Just a day after the agreement with the 360 Finance, the Qtum Foundation announced a strategic partnership with the Baofeng Bokocloud. Baofeng offers one of the most popular video streaming services in China and has over 200 million active users. Qtum will be able to run more than 50 thous. Nodes in the cloud service Bokocloud, which will allow it to significantly expand the reach and, possibly, surpass the Ethereum network.
3. Stellar
Like Qtum, Stellar focuses on attracting multinational corporations to their so-called “smart contracts”. Smart contracts independently monitor compliance with the terms of the agreements. Ethereum platform has gained high popularity precisely because these contracts are completely transparent and legally binding. For the same reason, many developers (in particular, the Stellar team) include smart contracts in their blockchains.
The biggest success of Stellar was the signing in October of a cooperation agreement with IBM and the KlickEx cryptocurrency exchange platform. IBM earns tens of billions of dollars outside the US, and partnership with Stellar will allow it to more quickly conduct transactions with foreign countries.
Stellar has deployed its technology in the top ten banks in the South Pacific. The company estimates that each transaction will take from 2 to 5 seconds, which is much faster than payments through modern banking channels (when payment arrives in a few days). This would potentially increase IBM’s profitability and improve its customer relationships.
4. NEO
Like Qtum and Stellar, NEO uses smart contracts while trying to borrow the benefits of Ethereum technology. The NEO blockchain is distinguished by increased determinism, scalability and compatibility. For example, developers of smart contracts for the NEO network do not need to learn a new programming language. This provides cryptocurrency significant advantage over Ethereum and its counterparts.
A curious aspect of the NEO network is that it is not decentralized (at least for now). Distribution, or the idea that no one person or organization can control cryptocurrency, is the basis of most blockchains. However, in the case of NEO, developers control a significant proportion of coins issued, and the cryptocurrency itself is not mined. Such centralization disturbs some investors, but at the same time contributes to rapid progress, since key decisions are made by a small group of people. Thanks to this, the developers were able to increase the network bandwidth of the NEO to 1000 transactions per second. In speed, it is slightly inferior to the Ripple, however, it is significantly superior to Ethereum.
5. nano
Perhaps the main advantage of Nano is the high speed of its blockchain, arranged by spatial architecture. The Nano network is able to process up to 7 thousands of transactions per second, while equipment upgrades will increase this figure even more. For comparison, Ethereum can only make 20 payments per second.
For the high bandwidth of Nano, the above mentioned spatial architecture of the blockchain is responsible. Each account has its own block chain, so during transactions you do not need to wait for confirmation of the entire network. Users control their own accounts and blockchains, as a result of the transaction they pass with lightning speed.
However, it is worth mentioning one feature. Each payment on the Nano blockchain requires two transactions (albeit free). First, the sender withdraws money from his account, and then the recipient credits it to his. Such a structure considerably increases the cumbersomeness of the system, although the incredible speed and scalability of the Nano network partially compensate for this disadvantage.
6. Iota
If you are looking for something unusual in the world of cryptocurrencies, pay attention to IOTA. Late last year, the IOTA Foundation introduced the Data Marketplace. This blockchain-based service allows companies to share and sell their unused data. Developers believe that most corporate data remains unclaimed. Under these conditions, the blockchain will act as a reliable intermediary, allowing the sharing of this data.
IOTA blockchain is actually considered “non-block”. In other words, it is open and completely free to online users. The refusal of commissions provides a significant advantage compared to other projects based on the blockchain and modern payment systems.
Of course, IOTA has a lot of work to do to scale its blockchain. The Data Marketplace is still being tested, and around 40 large companies provide project feedback, but transaction speed is still far from ideal. Nevertheless, it is an intriguing startup that you should pay attention to.
7. Monero
In recent months, there has been an increase in the popularity of confidential cryptocurrencies, such as Monero. All of them are trying to ensure complete security and privacy of digital transactions.
Perhaps one of the main misconceptions regarding cryptocurrencies is their high anonymity. Since senders and recipients of digital money do not provide their passport details or social security number, it is believed that they cannot be tracked. However, this is not true. In many cases, blockchain analysis allows you to identify the sender or recipient. In the case of Monero, however, this is almost impossible. All references to the parties to the transaction are destroyed after its completion.
Monero success is based on the use of ring signatures and hidden addresses. A good analogy for ring signatures is a joint bank account with several owners. No one knows who exactly of them receives or sends money. In the process of work, a so-called “hidden address” is created, which allows the owner (and only him) to block and transfer his funds.
However, interest in cryptocurrencies with increased anonymity is growing not only among investors, but also among the authorities. Recently, the South Korean government obliged all traders to link exchange accounts to bank accounts, thus intending to increase transparency in the cryptocurrency market.
8. NEM
There are few cryptocurrencies in the world that can compete in speed with Nano or Ripple. NEM is one of them. Its network is capable of conducting about 4000 transactions per second. The basis of NEM is an intelligent blockchain with wide settings that can fit into various industries and sectors of the economy.
In particular, NEM can be used in non-currency applications (although it has proven itself well in the financial industry). NEM Blockchain allows retailers to increase the effectiveness of bonus programs and programs to support customer loyalty, reducing fraud and increasing customer interest in retail chains.
NEM is suitable for the technology sector, where it can be used for data authorization and storage. Theoretically, his blockchain is able to authenticate IoT devices that make independent decisions (for example, ordering parts for repair with the consent of the owners).
NEM recently signed a partnership agreement with Malaysia Digital Economy Corporation. This government organization manages Malaysia’s digital infrastructure, controls industry laws and promotes technology development. The partnership can bring significant benefits and significantly expand the range of possible use of the NEM blockchain.