Crypto

Calculating the Crypto Revolution- 2021

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Which Cryptocurrency Has The Best Future?

The meteoric rise in the price of Bitcoin has put cryptocurrency on a map in the investment world. Bitcoin has outperformed excellence in terms of cost ever since its launch a little over a decade earlier. This is the most valuable cryptocurrency, with a $1 trillion economy. While Bitcoin is the most popular cryptocurrency, there are over 5000 cryptocurrencies in circulation today.

Numerous cryptocurrencies have outperformed Bitcoin in terms of performance. Ethereum, the second-largest cryptocurrency, has increased by 750 % since 2020, surpassing Bitcoin’s 600 % return over the same period. Many of these cryptocurrencies are directly competing alongside bitcoin. Investors are starting to question, ‘What to look out for in the Crypto Revolution- 2021?’

NFT

NFT Non Fungible Tokens are digital assets that can only be found online. They represent various valuable assets like art, artworks, sports cards, music records, digital real estate, and so on. Each NFT represents the unique data that enables users to distinguish between the two NFTs. The info also allows us to validate the legitimacy of the assets. As each NFT is distinctive in its own right, they cannot be exchanged.

Non-fungible tokens, or NFTs, have exploded onto the digital art scene this past year. Proponents say they are a way to make digital assets scarce, and therefore more valuable. 

Nowadays, most NFTs tend to be digital. This makes it particularly easy for creators to give their supporters something rare and unique. Some NFTs, for example, are digital artworks, and people are now collecting these digital artworks, just like collectors have collected physical paintings for years. And some of these NFTs have gone for extraordinary prices.

A more down-to-earth version of a modern digital NFT is CryptoKitties. They are an Ethereum blockchain game where users can buy, sell and breed digital “cats.” Every “cat” is unique (just like your real-life pet).

In some ways, NFTs are similar to Bitcoins and other cryptocurrencies, except, of course, they are non-fungible and non-divisible. The first NFTs were part of the Ethereum blockchain, which stores extra electronic information to distinguish their uniqueness. Other blockchains now also facilitate NTFs. Because of the differing blockchain technology behind particular NFTs, not all NFT marketplaces buy and sell all types of NFT. Creators will often select an NFT marketplace based on whether that marketplace supports a specific NFC token standard.

Yield Farming

It is a facet of the Defi network that enables users to acquire cryptocurrency using cryptocurrency. Its process is equivalent to lending money with peers and being able to earn interest on money lent. Yield farming allows people to lock in their crypto for a set period of time for rewards. Incentives could include interest, new tokens, other blockchain-based coins, and so on.

At its core, yield farming is a process that allows cryptocurrency holders to earn rewards on their holdings. With yield farming, an investor deposits units of a cryptocurrency into a lending protocol to earn interest from trading fees. Some users are also rewarded with additional yields from the protocol’s governance token.

Yield farming works in a similar way to bank loans. When the bank loans you money, you pay back the loan with interest. Yield farming does the same, but this time, the banks are crypto holders like yourself. Yield farming uses “idle cryptos” that would have otherwise been wasting away in an exchange or hot wallet to provide liquidity in DeFi protocols.

Also read: What to watch out for in Crypto- 2022?

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Sara Garg
A LAWyer who (Loves the Art of Writing). I play with words both in the courtroom and on the website.

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