Cryptocurrency itself is an amazing technological development but the innovative advancements made on various projects stemming from the first are also quite a sight to behold as well. Regardless of what the issues may be, others have produced a wide variety of products to alleviate these issues and provide the world with a better alternative. Sometimes, innovation came simply from seeking to do something new as well and managed to address issues within existing products. To highlight some of these crowning achievements, we are going to take a look at some of these revolutionary products and how they’ve changed the face of crypto and helped ease problems like risk and volatility.
Aptly named, stablecoins are cryptocurrency offerings that are designed to greatly reduce the volatility that comes with other cryptocurrencies by having a fixed price per coin. For some, this means backing each unit of cryptocurrency with a real-world asset such as the U.S. Dollar or gold (which may result in some volatility overall but will still shield the asset from the highs and lows expected from the market). Other cryptocurrency products like these will instead use a model that backs crypto with a variety of major cryptocurrencies and others will use an algorithm that keeps the stablecoin at a set price and will create a reserve to pay out users. All three of these models have something unique to add to the mix that seeks to eliminate volatility and promote products with a true store of value for users.
There are many reasons why cryptocurrency users wish to have more privacy when using their cryptocurrency assets but the majority agree that privacy is an essential feature of crypto. Although there is some privacy involved in most crypto models, government regulations and public ledgers often make it much harder for people to stay anonymous and move or store their assets quietly. In response to this, we have many privacy coins on the market that add an extra layer of anonymity and privacy to transactions. These products will use special algorithms that either hide transactions in plain sight or eliminate this information entirely so that users can keep their transactions shielded from the public. While these coins may be much harder to use compared to more popular crypto offerings, they certainly help to shield some from the risks of hackers and other potentially problematic situations.
Blockchains Utilizing Smart Contracts
Ethereum’s entrance into the crypto market played a pivotal role in improving blockchain technology as it introduced us to the smart contract. A smart contract is simply a set of terms and conditions that must be met before a transaction can successfully take place. This new addition to the space added an extra layer of security to certain assets and allowed for new cryptocurrencies and applications to come into the industry and build upon the existing blockchain. While it certainly won’t be the last development, this major change has fostered growth and changed many of the ways that crypto functions.
No investment is without risk but this risk has allowed for various solutions to be invented and used as safeguards by investors and enthusiasts. If you are especially impacted by some of these risks, the brief guide above will teach you more about different products that could serve as protection against some of the issues you may encounter during your investing journey.