With the growth of Cryptocurrencies, it is nearly difficult to find someone who is unaware of what Cryptocurrencies are and how they work. Investing in a promising Cryptocurrency is critical to being a successful Crypto trader. That’s why, in this article, we will discuss three Cryptocurrencies that have high potential to rise in 2021: Cardano (ADA), Ripple (XRP), and Solana (SOL).
Cardano is now being referred to as the “future of cryptocurrencies,” owing to the fact that it is a one-of-a-kind currency with a promising future. Cardano is regarded to be the third generation of Cryptocurrencies along with IOTA, which is the last generation and tends to address many problems that other Cryptocurrencies encounter, whereas Bitcoin is considered to be the first generation and Etherum is considered to be the second generation.
Unlike Bitcoin, Ethereum, and other cryptocurrencies that utilize PoW (Proof-of-work) infrastructure, Cardano uses a decentralized PoS (Proof-of-stake) blockchain. Cardano has many advantages for using PoS (Proof-of-stake). For example, for a cryptocurrency to be widely used, the transaction speed must be fast, and Cardano addresses this problem by using Proof-of-stake. Unlike other coins, Cardano’s blockchain does not allow everyone to mine Cardano, Proof-of-stake grants traders the ability to mine based on the percentage of coins they own, this way the system does not lose a lot of computational power, and the amount of electricity required is lower when compared to other Cryptocurrencies, as a result, the transaction speed is way faster than other Cryptocurrencies.
The launch of Smart Contracts in September
The term Smart Contract was first used by Nick Szabo in 1997, long before cryptocurrencies were created. Smart Contracts are similar to traditional real-world contracts, with the only exception that Smart Contracts are entirely digital. Smart contracts are computer programs that are stored on the blockchain.
Contracts, as we know, are written statements between two parties that state that the two parties agree with what is written in the contracts. However, sometimes one of the participants who agree to the contract may not be honest and may not obey the contract deal, which is why a third party is involved in the contract who will ensure legal consequences to the participant who does not agree, mostly law consequences.
Smart Contracts operate in a similar manner, but because there can be no physical interaction between the participants when trading Cardano, a third party joins and enables the two participants to store the Cardano in a temporary dedicated account, and after both of the participants deposit digital cash in that account, the smart contract will proceed with sending the cash to both of the participants, this way ensuring that both of the traders stay correct to the contract they agreed.
According to IOHK, smart contracts for Cardano will be launched on September 12, 2021, which will be a significant shift for the better for Cardano. Many cryptocurrency enthusiasts believe that when smart contracts are deployed, the price of Cardano will skyrocket.
2. Ripple (XRP)
Ripple and XRP are two distinct concepts that we will discuss briefly in order to give you a sense of what they are and how they function. Ripple was founded in 2021 as a money transfer network with the goal of making money transfers as simple and quick as sending an email.
The current traditional money transfer system is called Swift, and it’s not very compatible to use because of the transaction speed and fees that it currently has. For example, if you try to send money to a different state using Swift, the transaction can only be completed after 3-5 days, and the fees of the transaction are very high. Ripple is trying to reduce these problems by implementing the ripple network, which will enable international transactions to be completed in 3-4 seconds with cheap low transaction fees. However, this excellent idea is stuttering because of legal issues with the Securities and Exchange Commission (SEC) which we will discuss later.
What is XRP?
XRP is a currency created by Ripple Labs that is intended for financial institutions to utilize as an asset that functions as a bridge for multiple fiat currencies, making it easier for individuals in different countries to interact using fiat money. XRP is a cryptocurrency that differs greatly from other currencies in several ways. Unlike Bitcoin, which utilizes the Proof-of-Work (PoW) algorithm, or Cardano, which uses the Proof-of-State (PoS) algorithm, XRP uses the XRP Ledger Consensus Protocol, which allows the coin to preserve account balances and perform efficient and fast transactions. This ledger can only be maintained by a few individuals, these individuals can be anyone who is trusted from real people to banks or other financial institutions. For a transaction to be successful, all of these individuals must reach an agreement, but if one of them doesn’t agree then nothing happens until another solution is found. Unlike PoW coins, which generate “blocks,” XRP generates “ledgers.”.
What is the Ripple SEC Issue?
After the Securities and Exchange Commission (SEC) filed a legal complaint regarding XRP Cryptocurrency, the price of XRP dropped from 0.70 U.S Dollars in November 2020 to 0.20 US Dollars in December 2020 in a very short amount of time. The SEC filed a complaint against the XRP coin, claiming that the coin’s inventors failed to register the coin as a cryptocurrency, this way making XRP not legal. According to the SEC, the XRP creators raised about 1.3 billion US dollars through unlicensed and unregistered securities offerings.
Where Can I Buy Ripple?
Ripple is a popular Cryptocurrency, therefore you may purchase it on a variety of sites by establishing a Crypto wallet. It is critical to select a Platform that has low transaction fees, is secure to use, and is not spammy. Coin.space is a trustworthy site where you can buy and store Ripple. It offers minimal transaction fees and is one of the most secure wallets available.
Solana Cryptocurrency was created in 2017 by Anatoly Yakovenko. Solana has a price of $74.30 according to CoinMarketCap, and it hit the highest price of all time just yesterday with $78.72.
Solana is another ground-breaking Cryptocurrency. Despite the fact that Solana is a relatively new Cryptocurrency and is not generally recognized in the Crypto industry, Crypto enthusiasts think that the way it operates and the technology it utilizes will make it the next great thing in the near future. Solana’s founders are attempting to make the Solana coin the quickest currency in the market, which is necessary for a coin to become widely utilized internationally.
Solana currently has 50,000 TPS (Transactions Per Second) with a 400-millisecond latency in creating new blocks, which is relatively quick when compared to other Cryptocurrencies. Whereas Bitcoin has a transaction rate of 5 transactions per second and generates new blocks every 10 minutes, Ethereum has a transaction rate of 30 TPS and a block generation time of 12 seconds, and so on. So we can see that in a way Solana’s founders significantly distinguished themselves from the other Cryptocurrencies in terms of speed.
As we mentioned earlier, speed plays a very big role for cryptocurrencies to raise more, that’s why many experts state that Solana has a huge potential to hit a high price in the near future, to prove to us that Solana has a bright future, we can see it’s price history wherein January 1st it had the price of only 1.84 U.S Dollars and now stands at 74.30 U.S Dollars.
Solana has approximately 600-700 validators, which is a low amount when compared to other Cryptocurrencies such as Ethereum, which has over 11,000 validators. Any individual that owns Solana is able to become a vendor, which is why it’s believed that the number of vendors is expected to grow rapidly in the future.
What Mechanism Does Solana Use?
Unlike the other Cryptocurrencies we discussed, Solana has picked one of the best algorithms to use: the Proof of History (PoH) algorithm. With this algorithm, you can create historical records which prove when an event has occurred.
Among other features that make Solana unique and distinct from other Cryptocurrencies, there are 8 innovations that Solana utilizes to make the transaction speed faster: Proof of History(PoH), Tower BTF, Sea level, Turbine, Pipelining, Cloudbreak, archivers.
There are many cryptocurrencies out there that are attempting to overtake others, but cryptocurrencies that are attempting to provide something unique have a better chance of success. The cryptocurrencies described and presented in this article all have unique characteristics; some are trying to implement faster transactions, while others choose to have more secure transactions, and so on. However, all of them are great in their own way and have a strong potential to grow fast in 2021.