Top Trends In Cryptocurrency : 2020

As you may know, the crypto industry is one of the fastest moving and most rapidly-expanding industries in the world. Moreover, that brings announcements and news of new projects or partnerships practically on a daily basis. With so much going on, it can be hard to keep up. Not to be worried, this article breaks down some of the top trends in crypto in 2020, so you’ll get a basic understanding of what is hot right now in this booming industry.

For anyone new to cryptocurrency, plus those who are interested who are already in the market, we have broken down a list of the top trends in crypto to watch in the upcoming 2020 and 2021 market, possibly even going into the 2030’s.

In this article, we discuss the biggest subjects of the year so far and take a deep dive into them a little bit further. This article is an introduction to the different trends that are beginning to flourish as we enter the third quarter of 2020.

After reading this you will have an idea into the different sides of cryptocurrency and the many different services ad tools available in the space, of course with the knowledge and education of the top trends in cryptocurrency that many people are looking into for their latest and greatest investments.

As always, if you are looking to learn even more about cryptocurrency and the top trends in cryptocurrency during 2020 and moving on, please consider enrolling in Ivan on Tech Academy. Join over 20,000 students already learning about blockchain and crypto! Also FOLLOW THE BLOG!!

Defi(Decentralized Finance)

DeFi is generally used covering many different aspects of financial tools that are now available on a decentralized network such as lending, borrowing, and trading. To learn a more in depth understanding of Decentralized Finance, Ivan gives a great understanding.

As of September 1st, 2020, the amount of money locked up in Defi has reached over $9.5 billion dollars. DeFi has grown to become the leading sector of cryptocurrencies in 2019 according to Consensys research.

DEX’S(Decentralized Exchange)

Decentralized exchanges are seriously competing with centralized exchanges right now. Recently, trading volumes on the Uniswap platform alone were larger than those of Coinbase Pro, IN LESS THAN A YEAR! With the decentralized exchange gaining more than 10x in just a month. This was a huge achievement for the DeFi space. With competition popping up left and right, Uniswap seems to be the go-to-dex….. For now.

Uniswap's August Volume Topples July $1.76B Record in Less Than Two Weeks -  CoinDesk

Despite record transaction fees on the Ethereum network, Uniswap is the exchange of choice as the platform gives users early access to many of the hidden gems before they reach the larger exchanges such as Binance, Coinbase, or Kraken. Though $50 gas fees will surely price some people out of the market, many are still willing to pay to get exposure to a promising token early!

NFTS(Non-Fungible Tokens)

Non-fungible tokens came to prominence with the release of Crypto Kitties in 2017.

Crypto Kitties is an Ethereum-based blockchain game where players can purchase, collect, breed, and sell virtual cats. NFT’s allow for assets to be held on the blockchain in a way that can guarantee authenticity and proof of work at the origin of creation. This is extremely useful for unique and rare in-game(such as a Diamond Pickaxe) items and defeats the concept of stealing someones stuff or destroying an item, for the action would have to be examined first by the original creator. AWESOME RIGHT!

Fast-forward to 2020, NFT’s now are used for many purposes. NFT’s allow assets to be tokenized on the blockchain. Fungible cryptocurrencies such as Bitcoin or Ethereum are interchangeable, meaning that 1 BTC in my pocket is the same as 1 BTC in your pocket, and there is no difference between Bitcoins. A non-fungible token can store personalized data referencing to an asset or property on the blockchain, in an immutable and transparent way. Once again defeating the concept of meddling with a transaction of goods.

NFTs are used for digital art, certifications & licensing, and gaming, with potential future use cases in healthcare and real estate… maybe within everyday grocery items!

As there are so many other trends and sectors within cryptocurrency, These are just some of the top stars… For now…

What Is A Blockchain ?

First off, Do not think of blockchain as an app store where developers can just create and launch their product on it. Although understanding how a blockchain works is complex and confusing, we will discuss the key terms you need to know when learning about blockchain and the functionality between them.

Basics of a blockchain.

Invented in 2008 with Bitcoin, The tech behind blockchain enables digital information (pictures, money transfers, texts, phone calls, etc.) to be distributed, but never copied or altered in anyway. This enables a piece of data to individually have one owner. The beauty of this concept can have a magnitude of applications, especially when it comes to privacy data such as identity or individual wealth. Normally being heard as a “distributed ledger” which is true, the information within the blockchain is constantly reconciled into the database. Meaning the data is pubilc, verifiable, and being stored in multiple locations and updated instantly with anyone who interacts with the blockchain. This makes it extremely difficult to hack due to the decentralized nature of the protocol. Since the data is being stored in multiple locations and exits in multiple locations, the result is hackers can’t determine an IP address to steal precious, valuable data.

Why is it called a blockchain?

The term blockchain is derived from how the technology functions. To break it down simply, A block in the chain, is a record of transactions. Using cryptographic hash technology, each block that is created are chained together, representing the previous block’s transaction data and a timestamp representing its creation on the chain. Once created, the data in any given block can’t be altered unless every block on the chain adheres to the change in the entire chain. Typically blockchains are managed by a peer-to-peer network, being agreed on within the protocol through inter-node communication for verifiable and validated new blocks within the chain.

Benefits of blockchain.

What are the benefits of blockchain and what purpose does it provide? How is it better than current data transfer systems? What are the downsides and compromises? Are people using blockchains or is it just hype? These are the assumptions everyone has when first hearing about Cryptocurrency.

The growth of blockchain intergration by market size has been booming for the past 10 years since its creation and is estimated to grow 1000% – 10,000% in the United States of America alone by the end of 2025. The main reasons for this growth consists of big tech names like Mircrosoft, Apple, Starbucks and even IBM intergrating blockchain technology into their own products to offer to their customers.

Use Case Number 1

Joe is extremely addicted to gardening and wants become a farmer to start selling plants of all kinds. He takes the precious time out of his day to check the temperature of the soil for each individual plant, checks the weather, inspects the moisture content, and organizes his garden strategically to help with plant growth. With so many different plants, soil types and water consumption for those plants, it takes a lot of research and time to figure out his garden for a maximized yield. Blockchain can help Joe’s frustration. With a tracking protocol oriented blockchain such as Vechain (https://www.vechain.com/), Joe can purchase sensors that help manage his plants. Data from his plants (soil type,moisture, root strength, weed formation,etc.) can be recorded on the blockchain along with several other farmers due to its secure decentralized manner. Since the data is secure and is 100% immutable, Joe is able to see his plants growth compared to other farmers. This helps Joe not make make mistakes and helps him get the most out of his plants!

Use Case Number 2

Bjorn is a wealthy man that owns several business in the United States but has family in the Middle East that are poor and can barely afford to live comfortably. Bjorn sends them money every month to help them, but ends up paying high fees in the United States and has to send extra money in his transfer, for the fee that his family has to pay to transfer it out in the Middle East. In addition to the fees, the transfer can take up to 2 business weeks to hit his family’s account. Cross-border payments have been an issue since the beginning of time, and blockchain solves this problem. A cross-border payment oriented blockchain such as Ripple (https://ripple.com/) where XRP can be sent to his family. A transaction through Ripples blockchain, powered by the XRP token, has an average transaction time of 5 seconds and is secured through the blockchain with a one time transaction fee one of $0.002. Bjorn can now send any amount of money seamlessly to his family with no worries or strings attached thanks to blockchain.

Downsides of blockchain.

Although blockchain is a revolutionary technology, just like the internet, it has some disadvantages when compared to other systems that involve data, money, and media. Some things to consider when talking about blockchain are…

  • Blockchains use excessive energy
  • Blockchains are not indestructible
  • Some Blockchains are extremely complex and makes them inefficient
  • Blockchain miners can pool hash power together, compromising the integrity

The chance of attacks on a blockchain and altering its performance are very slim, but the threat of it will always be there… looming in the darkness. Regardless of the few flaws in certain blockchains, it is still one of the greatest upgrades to the internet for seamless peer-to-peer data transfers of all types. Blockchain is here to stay and pave the way for innovation to help mankind.

Cryptocurrency V.S. Fiat Money

Cryptocurrency and basic Fiat Money have a variety of similarities but cryptocurrency offers huge advantages. Whether you are a business owner, a worker, or any sort of asset manager. Having governance over your wealth is an important part for your growth.

  • Both can be treated as a store of value
  • Both rely on consumer trust to enable a transaction
  • Bitcoin can be trusted due to its tamper proof technology and can’t be spent twice
  • Fiat Money is verified by a third party giving consumers peace of mind

What is Fiat Money?

Fiat money is a currency that is treated as a store of value that’s created by governments to regulate economies and people. Usually in the forms of printed dollar bills or minted coins, Fiat Money only attains value based on the governments contribution to the value through monetary policy and governed regulations within the economy. In short, Fiat Money is value created by governments with rules that the overall population has to follow.

What is Bitcoin?

Bitcoin is the first cryptocurrency that was created by an unknown entity named Satoshi Nakamoto. Theories of Satoshi have pointed to the Russian Government, The combination of the biggest technology companies, and even a man in China named “satoshi”. With Bitcoin only having 21,000,000 units, governed and distributed through a safe and secure blockchain through the process called mining, the value of it is truly based on what people want it to be. Also making it an even more scarce asset when compared Gold, Bonds, or Stocks. There are many types of different cryptocurrency.

  • Privacy Tokens
  • Defi Protocols
  • Tracking Tools
  • Reward Tokens
  • Stablecoins

With so much innovation within the space, Cryptocurrency projects continue to create new alternatives to the current financial system and the problems it comes with it, ranging from liquidity, verification, and transaction times.

Advantages with Fiat Money.

Fiat Money still remains the “top dog” legal tender in most countries simply due to the fact they are stable and controlled. Unlike other types of currency like cryptocurrency or commodity-based currencies, The stability of fiat currencies allows regulators and banks to fight against inflation and financial recessions. Therefore, when an economy is sinking or booming, Currencies will be adjusted as such to accommodate the overall condition of an economy.

Advantages with Cryptocurrency.

Available with a click of a button, and sometimes no security checks needed, these currencies are accessible for anyone who wants to make online transfers seamlessly. Even though cryptography is a complicated subject, in the future, Cryptocurrency will be easier to transact and own securely.

Cryptocurrencies came into being as a bi-product of Satoshi Nakamoto, the brainchild behind Bitcoin. Nakamoto did not intend to develop a currency but a peer-to-peer electronic cash system for facilitating transactions without any central oversight. The decentralized nature of the network means there is no central server or authority validating transactions between people or business. Everything is open source and is recorded on a blockchain for the entire public to see and to verify a transaction.