Cryptos’ has seen a widespread green in the last two years as a result of a consistent fight for a right. The power of the people and for the people has been cleverly translated as a “digital chaos”, by the central banks and the chattering governments. However, what stays a fact, still, is the presence of cryptocurrencies, they are still there and they continue to breed.
“Virtual Currencies may hold long-term promise, particularly if the innovations promote a faster, more secure and more efficient payment system.”- Ben Bernanke
BTC dominance is slowly fading- a window of opportunity for other cryptocurrencies; it’s future, as a consummation of its controversial popularity, remains still buoyant. BTC, at the time of writing, is at 6700.23 USD, striving to hold its gains, and, Ether, another crippled yet principle performer, breathes through its turtle pace, at 290. 70 USD. These digital assets, nonetheless, are riding towards a momentum that has been taken seriously by investors.
The whole Crypto evolution, surviving on Blockchain- a decentralized, incorruptible, and secure public ledger, highlights a lot of questions, all of which, I answer one by one! Starting with crypto theft!
- Cryptocurrency theft
- Which cryptocurrencies can survive in the real economy?
- What progress has companies made so far to ensure the safety of cryptocurrencies?
- The Stable Coins Debate: Trustworthy coins with low volatility or just highly anticipated market tool.
- Wallets, Exchanges, and Digital Banks to secure cryptocurrencies; How true are they?
Around $ 1 Billion cryptocurrencies ware stolen in the first half of 2018; disclaimer, it was really easy to do, according to an article by CNBC and reports curated by Carbon Black. The malware that is used and patterned along with a customer service is as cheap as $ 1.04 on the dark web and costs $224 on the surface web. This means that the crypto ecology is susceptible to an easy manipulation which depends directly on any frustrated yet talented hacker.
Carbon Black Security strategist Rick McElroy, in an interview with CNBC, states: “It’s surprising just how easy it is without any tech skill to commit cybercrimes like ransomware,” and continues to quote “It’s not always these large nefarious groups, it’s in anybody’s hands.”
These thefts come from crime groups dedicated to extorting exchanges and companies while organized cartels are also responsible for these sudden strangling of cryptocurrencies. Since cryptocurrencies are not entirely bulletproof, a fact only crypto ideated audience knows, the chances of anyone sitting in any Atlantic corner of the world, having decent coding skills is capable of dissecting the digital currency, for a reason as nominal to paying the rent.
With the theft news becoming a significant resident of all news channels critical of Blockchain and Cryptocurrencies, another question comes up;
Which cryptocurrencies can survive in the real economy?
Since not much is known about the overwhelming majority of cryptocurrencies so far, which means the fate of around 1,385 coins in the markets today is unpredictable; still, they are being bid up to multi-million dollar valuations. Let’s talk facts with an example here, Dogecoin, created as a fun response or a parody to the Bitcoin boom, at present has a valuation of $ 1.6 billion (at the time of writing). What’s more surprising is that the coin has no use case to back its accidental fame and yet investors are ready to make a wild bet with Dogecoin.
It is easy to determine the most prominent survivors in the list of most-traded cryptocurrencies.
Here are some of my predictions:
- Bitcoin: Emerging more of a store in value, Bitcoin the original cryptocurrency will stay and will continue to survive the market crash in future.
- BTC and Litecoin: Preferred for more daily transactions, both the cryptocurrencies are fast becoming a valid choice.
- Ether: Built on Ethereum’s universe of decentralized applications, the cryptocurrency is fast gaining traction, and has emerged out of its haunting past of continuous hacks.
- Dash: With its innovations in mining and fast processing, Dash has come out from the uniform of a fresher cryptocurrency and has promoted itself to a revolutionary digital asset.
Dash CEO, Ryan Taylor claims confidentiality: “We are the largest (cryptocurrency) in the space that is positioning ourselves as a payment network”.
- Stable Coins: Created as a resolution to cryptocurrency volatility.
Knowing that above coins have somewhere a future, the next thing I intend to discuss is what significant changes are new companies making to save crypto world an ongoing embarrassment.
What progress has companies made so far to ensure the safety of cryptocurrencies?
Since now we know, the history, present acceptance, issues, existing crypto theft trauma and rapid exchange crash, the next question arises which can fight for the crypto stakes, that is, what is the solution to all this?
Utility Tokens or more popularly known as User Tokens/App Tokens are not designed as investments unlike other ICOs, instead, they are designed keeping in mind the barter system. According to Strategic Coin, a startup can actually sell “digital coupons” in an exchange for its services to its clients or customers.
As an example, Filecoin, has raised around $ 257 million which had happened by selling tokens that offered users to have access to its own decentralized cloud storage platform. An innovative and bold step to promote service offerings other in an exchange of digital coupons which provokes trust in the whole crypto universe.
On the other hand, Rockz, a fully transparent asset-backed coin, claims to bring solidity, and trust in the crypto network and looks at changing the present standpoint of cryptocurrency. The network works on a 95% physical paper deposited in vaults and high-security bunker claims to fully support its investors and customers in case of bankruptcy. This means the value is stored physically which a sense of freedom to its users. How effective this sensible and much-needed change turns out to be, has to be judged.
Other than, Rockz, Security Token Offerings or STOs are the new kids on the crypto block. In the real world of investing, STOs works on the proposition of securing the money of investors as it is more fraud-proof and cannot be manipulated easily.
“Securities Token Offering aka STO is the next step towards legitimizing investor offering schemes for digital asset initiatives.”
Apart from these ICOs playing their luck, the crypto market also has something “stable”, part of which I discussed in the first half of this read. Here’s my screening of the coin so far.
- Ripple vs. Stellar: Will There Be Only One Winner?
- The Separation of Ripple and XRP: Why it Happened? What Does it Mean and What are the Differences?
- The Difference Between Fiat Money and Cryptocurrencies
The Stable Coins Debate: Trustworthy coins with low volatility or just highly anticipated market tool.
As the name suggests, Stable coins were launched in the market, as an attempt to maintain steady valuations in an era where cryptocurrencies rise and fall every single second. Since these unpredictable swings are nowhere characteristics of a currency, at the end they become impractical to use.
What are Stable Coins: A currency generally used as a mode of storage of value and a medium of exchange, with a stable value. Stable coins were launched in an attempt to accomplish the ideal currency behavior, that is spending the coins, and not storing them with minimum inflation.
I feel Stable coins are more of a representer, an ambassador for cryptocurrencies, as its increasing adoption will act as a catalyst to popularize the daily use of cryptocurrencies, and not store them. The stable alternative to other crypto coins, Stable coins, holds the capability to promote trading of goods and services, established over a blockchain application and assist in integrating financial applications as well as support market predictions.
According to Rafael Cosman, founder, and CEO of Trust Token comments on the potential of Stable Coins: “Stable coins are one of the keys to bringing the benefits of cryptocurrencies to everyday people, both in terms of price stability and decentralization of capital”.
What comes ahead in my verification is how the validity of stable coins be ensured in future?
The “Stability” of Stable coins can eventually strengthen the entire backbone of international banking, as they give a liberty to update the core compliance structure of banking. Based on the decentralized moto, Stable coins will eventually uplift efficiency, and promote transparency further improving the user experience.
As an example, Stronghold USD is at present launching a new stable coin of their own based on Stellar Network. After a successful launch, this would become the first venture-backed up by USD token. In my opinion, this is a bold step by IBM, and it is not a surprise since IBM has its own Blockchain Platform launched within these two years of crypto and blockchain fame.
Based on a similar pattern, Rockz has planned to issue a stable Rockz token, backed by the Swiss franc, which allows the cryptocurrency community or audience to get a reliable and legal tool. This can be used for buying and selling of goods and services, as well as fixating market profits which can, on the other hand, generate crypto trust that is missing from the market.
Before closing this article, I want to discuss one more issue, that is recurring like a bad migraine in the crypto universe.
Wallets, Exchanges, and Digital Banks to secure cryptocurrencies; How true are they?
The psychological impact of continuous crypto robbery has created a crack in the trust investors had in blockchain earlier, and the audience as well. As Investopedia reveals, the most high-profile hacks of this year are Bithumb: $30 million, BitGrail: $195 million, Coincheck: $534 million, and Coinrail: $37.2 million.
Exchange crash and crypto theft are shaking the faith of the investors lately and with these vibrant hacks, a frozen effect is immediately seen on the crypto values. From where I see, it cannot be said that nothing can be done or is not done, cyber attack is as old as the internet and will continue to exist, if not tackled sooner.
Cryptocurrencies have a big future and they might be mankind’s only chance to have control in their own hands. They are not perfect yet, but it is a good thing, that they are there. Crypto world is indeed capable of trust, let’s cherish the opportunity it provides.