By: Morgan Reeves
Cryptocurrencies: The next step in investment. The future of finance. That’s the crux of the matter, right? Digital currencies are here to replace the ones we’re using in traditional finance. Well, yes. But that’s not the complete story. Crypto’s purpose as a financial asset is only one piece of the puzzle. So what are the other use-cases of cryptocurrencies? In this, we explore.
Firstly, it’s worth looking at what a current is and how cryptocurrencies can – and do – tick those boxes.
A currency is anything that can be used as:
Traditional money, as we know it now, has all three of these. Cryptocurrencies do too – offering an opportunity for people to transact with digital assets and hold a store of value, albeit sometimes more volatile than others.
However, unlike traditional money cryptocurrencies has a much greater functionality over and above a currency. As assets based on the disruptive technology that is the blockchain, the cryptocurrency market is an expansive emerging industry with the massive application.
Cryptocurrency is largely used to generate high profits for its investors, even though the asset is very volatile. Trading crypto can give you much higher returns than traditional investments if you know how to time the market right. There are many new tools to help investors trade successfully on the crypto market and make a profit. The rise of automation and artificial intelligence is another example of our new “digital economy.” More and more automated trading systems are making their way onto the market, providing users with more flexibility, diversity, and autonomy when it comes to diversifying their assets on the blockchain network. This Bitindex Prime review details how these technologies are helping users to flourish in the crypto ecosystem.
Since Bitcoin was launched in 2009, there have been many new assets and projects based on the underlying technology – blockchain. New blockchains and networks have emerged that have been designed to support decentralized applications, which have been the cornerstone of a decentralized financial system. This means there are blockchains (networks) designed with a specific purpose in the crypto ecosystem that serve important functions as the world becomes more and more digitally savvy.
Each decentralized application (dApp) project has its own native token which gives holders a way to interact with the network and gives function to the token. For example:
UNI is the utility token behind one of the industry’s leading decentralized exchanges – Uniswap. With UNI, users can make use of the exchange and holders get to participate in how the exchange is governed. Because it is a decentralized exchange, there is no central authority that works on operating the platform: Meaning it is governed by the community who holds the UNI tokens.
The Basic Attention Token is the Brave browser’s native cryptocurrency token. Brave is inherently a privacy-focused browser that does not target ads at its users. With BAT, holders can use the browser and opt into advertisement content, while getting rewarded for opting into the ads.
Steemit is a social media and blogging platform that enables creators to receive rewards (Steem tokens) for posting high-quality content. This encourages users to contribute to the platform and it resolves the issues of centralized social media platforms monopolizing what content is distributed.
Non-fungible tokens are cryptocurrencies, albeit slightly different from tokens as the rest of the industry knows them. Where each usual cryptocurrency has tokens which hold the same value (as in one BTC is equal to another BTC), each NFT has a unique value. This means they represent completely unique digital assets, such as art or digital property that cannot be interchanged with other NFTs. Most commonly, NFTs are used in gaming, artworks, and real estate in the digital space such as the Metaverse.
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