The Cryptocurrency Projects that Will Stick Around
A careful analysis of world trends will tell you that people are prioritizing three things; Finance, Healthcare, and Security. My prediction is that the cryptocurrency companies that find a way to appeal to the needs of consumers are the ones that will stick around.
The popularity of cryptocurrency has exploded in the recent months. This is partially due to the fact that cryptocurrency has been on the rise for a decade anyway. Cryptocurrency tends to get a little more attention when countries manipulate their own currency. During the March 2020 economic crash, governments began to stimulate their economy with injections of cash. This in effect inflates the supply of cash, and devalues their money. Lebanon is currently experiencing hyperinflation of their pound. As in Venezuela, the people are willing to turn to any currency that is more stable than the government alternative.
As volatile as cryptocurrency is, it is more stable than a currency going through hyperinflation. It is remarkable when the world gets to see cryptocurrency actually get used for its intended purpose. A anti-inflationary, globally accepted currency. Cryptocurrency typically gets filed into the category of speculative investment. As more and more world currencies fail we will see cryptocurrencies be adopted as the default currency of choice. This fact is certainly being reflected in the projects that have gained traction in the past couple of months.
To name a few, Bitcoin, Ethereum, Cardano, and Crypto.com have all performed well amidst the economic crisis. The reason being that these cryptocurrencies all fuel the decentralized finance ecosystem in one way or another. Whether that is building decentralized financial services, or providing a simple way to spend cryptocurrency, these projects are creating value. People are also being forced to pick, and choose what they care about, and what they think will succeed. It is for this reason that projects that are not offering something unique against the leaders will eventually fail.
In the United States, healthcare is privatized. This means that people need money to pay for hospital care. How can cryptocurrency help with this? Well, there is a growing trend of cryptocurrency companies offering discounts for paying with cryptocurrency. For example, I can earn cashback in cryptocurrency by shopping at grocery stores with my Crypto.com Visa Debit Card. Consumers are spending more money at the drugstore and grocery stores than anywhere else. Cryptocurrency companies are able to capitalize on this by incentivizing their users to spend cryptocurrency at these categories of stores. Crypto.com is one of the companies doing just this, offering 10% cashback on all grocery store purchases.
Since the inception of the internet and social media, the conversation of privacy and security has never gone away. The latest topic to make its way into the privacy conversation is COVID-19 tracker apps. Cryptocurrencies that cater to privacy and security have a serious long term place in the industry. Privacy coins offer a service so private and secure that nothing offered by a company will ever be able to compete. Lets face it, data breaches aren’t going away. More of our data is going to be leaked onto the internet. COVID-19 tracking apps could become mandatory for some countries. There are many people that believe this is the way in which our privacy rights will be eroded. These are the people that form the user base for privacy oriented cryptocurrencies. Projects like zCash, Monero, and Dash will definitely be sticking around for the next 6 months of crypto.
The Cryptocurrency Projects that will Fail
The projects that will fail, are the projects that do not create a unique value proposition against the established giants. Bitcoin is the people’s currency, Ethereum is the epicenter of decentralized finance. Even Ripple is the puppet cryptocurrency of the banks. Just like the dot com bubble in 2001, a certain number of companies entered the crypto space simply because it was trendy. There is nothing like a global economic crisis to finally put the nail in the coffin for many poorly thought out projects.
There is little tolerance for mistakes at the moment. Cryptocurrency projects need to be immaculate in their execution if they wish to make it in the long run. Tron for example has run into several scandals in the past 12 months. Both the reputation and the price of the asset (TRON) has suffered as a consequence. On top of this, people are realizing that Tron does not offer anything you can’t get on Ethereum. In the past 18 months, Tron went from a top 10 coin, and has fallen to the 18th spot on coinmarketcap.
The Next 6 Months
In a nutshell, people are consolidating their investments in assets that are gaining momentum despite the global crisis. It’s not a mystery as to what these projects have to offer. These projects are actually offering remedies to some of the problems that ordinary people are facing. Whether that is guarding against hyperinflation, or helping people save for their future by offering discounts and cashback on spending. By the end of 2020, the projects that are already big, are going to get much bigger.