The outgoing year was also remembered for the massive attempts of many countries around the world to create a fundamentally new type of money - a central bank digital currency (Central Bank Digital Currency, CBDC). It is expected that it will differ from the usual banknotes and non-cash funds, complementing them, but at the same time will not become another cryptocurrency. China is the most active in the media space, but even it has not yet managed to reach the final goal and create its own CBDC. Meanwhile, such a currency has existed in the world for a year now, and it is issued by the central bank of the Bahamas, a state traditionally perceived as an offshore. The head of the regulator, who until recently few people outside the Caribbean had heard of, is now called one of the most powerful people in the world. Digital kings - in the material of Lenta.ru.
Without papers
Non-cash payment has long become a common payment method in most countries of the world. At the end of the 2010s, the leaders, unexpectedly for many, turned out to be those who missed the stage of formation and initial development of relevant technologies and were forced to catch up with the rest by updating the infrastructure, primarily banking. Russia occupies a special place. From 2010 to 2022, the number of card transactions increased a record 30 times (against a two to threefold increase in Europe) - to 172 per year on average per resident. The phenomenon was called the “Russian miracle,” and during the pandemic it only continued: in 2020, when everyone around was afraid to come into contact with objects and surfaces, and banknotes were seen as a source of infection, the country ranked fourth in the world in terms of the rate of refusal of cash.
Until recently, it seemed that this situation would persist for a long time: cash would gradually go out of circulation, and it would finally be replaced by electronic payments. The trend was reinforced by the emergence of ever new technologies, thanks to which there was no need even for plastic cards themselves: instead of them, you can attach a smartphone, smart watch or bracelet to the terminal. At the same time, regardless of the technical method of payment, we are still talking about official money issued by the central bank and taken into account as part of the total money supply of a particular country.
Photo: Alexander Kazakov / Kommersant
In 2009, an alternative appeared: an unknown programmer (or group of people), hiding under the pseudonym Satoshi Nakamoto, developed the world's first cryptocurrency - Bitcoin. It differs from the usual means of payment primarily in that it is issued by members of the community (the platform that created a certain cryptocurrency) regardless of the financial authorities of a particular country. The same participants, using powerful computers, process and control encrypted (hence the root of crypto) transactions and receive new units of a specific currency as a reward. This technology is called blockchain - after the chains of information blocks that contain encoded information about the currency and transactions in it. Over the past 12 years, Bitcoin has become a symbol, and for many even a synonym for the concept of “cryptocurrency,” but in reality there are many of them around the world.
Governments have traditionally viewed cryptocurrencies with caution and skepticism, or even called them a means of paying for illegal purchases, laundering criminal proceeds and financing terrorism. Another reason for complaints is the high volatility (rate variability) of cryptocurrencies, which is fraught with losses for their owners. Sometimes exceptions happen. This fall, the small Central American state of El Salvador recognized Bitcoin as an official currency in which prices can be set and taxes can be paid. The government-approved crypto wallet Chivo has also appeared. Moreover, one of the power plants, built next to the volcano and using its geothermal sources, began to provide its capacity for mining.
True, already on the first day after the legalization of Bitcoin, its rate fell sharply, which led to a partial depreciation of the local currency reserves, to which cryptocurrency was added. Local residents, also angry that the authorities did not consult with them before passing the law, came out to mass protests, only confirming the fears and caution of other countries that are in no hurry to equate cryptocurrency with regular money.
How will Chinese cryptocurrency affect the world?
It is too early to make accurate forecasts, because... The system itself is only being tested and has not been launched at full capacity. On the other hand, we can expect an increase in tolerance not only of Chinese citizens, but also of other countries towards cryptocurrencies and blockchain technology.
In addition, this is a favorable factor for greater openness of the investment society. For example, we should expect a strengthening of the position of cryptocurrencies in general. Following China, the United States may introduce its own electronic money.
Take a closer look
For a long time, the world's central banks almost did not react in any way to the troublemaker, at best taking part in the development of laws regulating the circulation of cryptocurrencies. In countries where they did not dare to fully legalize them (and these are the majority), alternative names were prescribed in documents, more like euphemisms. There is a law on digital financial assets in Russia, but what is meant by them is still unclear - lawyers and crypto market participants argue about this.
By 2017, a lot has changed. Two-thirds of all central banks spoke about exploring the potential of digital money. But we were no longer talking about cryptocurrencies, but about a fundamentally different invention, which was called the digital money of central banks, or CBDC (Central Bank Digital Currency). The Russian-language version is also used - TsVTsB, but so far it is the version in Latin that is more popular. At the beginning of 2020, 80 percent of regulators, whose countries account for three-quarters of the world's population and about 90 percent of global GDP, during a special survey by the Bank for International Settlements, announced that they were directly working on creating their own digital currency. The process in each individual case was at a different stage: some were just studying the issue, while others were preparing a pilot project. But the changes were obvious.
Bitcoin symbol on the streets of El Salvador, the first country to legalize this cryptocurrency
Photo: Jose Cabezas/Reuters
Over the next few months, many major central banks themselves went public. Scientific works or reports have been published by banks in England and Russia, as well as several Federal Reserve Banks that are part of the Federal Reserve System (FRS) of the United States. The European Central Bank (ECB), China, South Korea and Sweden were among the first to begin experiments in introducing digital currencies into the economies of their countries. It is believed that Beijing is seriously thinking about developing a digital yuan amid the growing influence of financial giants AliPay and WeChat, which already account for the majority of payments in China. The idea of a CBDC has not yet received its final universal design, but from what is already known, some conclusions can be drawn. The most important of them says that it is capable of radically changing the global financial system, making banks practically unnecessary.
China's path to blockchain
The country embarked on the path of technology development at the end of October 2019. During this period, Chinese President Xi Jinping made an official announcement about China’s choice of blockchain course.
Against the backdrop of the decision of the head of the country, Bitcoin entered a positive movement. Let us remind you that about 2/3 of the coin’s hashrate is concentrated in China. Therefore, China and cryptocurrency are closely related.
Behavior of the Bitcoin exchange rate against the backdrop of China's announcement of its choice of blockchain development course
The Chairman of the People's Republic of China chose blockchain because of the versatility of the technology. With its help, many areas can be improved in the country. In particular, Xi Jinping spoke about his intention to integrate technology into the Chinese economy.
The day after China announced its choice of blockchain course, the country’s authorities adopted a law on cryptography. In it, the authors described all the nuances of technology standardization in China. The stages of development of blockchain and crypto technologies in China can be presented in the following sequence:
- October 30, 2022. The Central Bank of China has formed a regulatory body to certify blockchain products.
- November 6, 2022. The Economic Planning Agency of the State Council of China has abandoned its prosecution of miners in the country. Cryptocurrency mining was excluded from the catalog regulating the types of activities that need to be eliminated.
- November 20, 2022. A national blockchain committee has emerged in China.
- April 10, 2022. The Chinese authorities have begun standardizing the security of the blockchain sector.
- April 14, 2022. A committee has emerged in the country to standardize blockchain and DLT technologies.
- April 25, 2022. The national blockchain network (BSN) was launched. The project's infrastructure allows its participants to simplify and reduce the cost of the development process, as well as the subsequent launch of applications based on the technology. Also, BSN, according to the local government, should accelerate the process of forming a blockchain economy and introducing technical solutions for smart cities.
Between the devil and the deep sea
Today, credit institutions act as intermediaries between the central bank of a particular country and all users of its currency - in addition to intermediary between the users themselves through deposits and loans. The Central Bank issues two types of money: cash and non-cash. And if the former are difficult to control, then transactions with the latter are easy to track thanks to banks, each of which has an extensive system of correspondent accounts opened with the Central Bank and other banks. They take into account all non-cash funds circulating in the national economy.
In practice, it looks like this: when an ordinary Russian decides to put 10 thousand rubles in cash on an annual deposit, a special account is opened for him, into which the money is credited. They go from cash to non-cash form, but are still registered with the original owner, being his asset. At the same time, they are transferred to the bank’s correspondent account with the Central Bank or another credit institution, which in turn reflects them on the account with the regulator under an agreement with the partner bank. For the bank, they become both a liability (to the client) and an asset (the Central Bank's obligation to it).
Head office of the People's Bank of China (Chinese central bank)
Photo: Jason Lee/Reuters
As soon as a bank that has accepted 10 thousand rubles for its deposit issues it as a loan to another client, it begins to be accounted for in a new capacity: not as cash, but as a loan. Since the depositor does not lose rights to them, and the borrower - albeit temporarily - acquires them, the process leads to an increase in the total volume of money in the economy. This effect is called the “banking multiplier.” It turns out that credit institutions issue much more money into circulation than the Central Bank, which is traditionally considered the only issuer.
To control secondary emissions, which can lead to too high inflation, the regulator uses the required reserve mechanism: a fixed percentage (usually within 10) of all funds raised must always be kept in a separate account with the Central Bank and cannot be used to issue loans. Thus, with a required reserve rate of 10 percent, an additional 100 thousand rubles from every 10 thousand raised will flow into the economy in several stages. Deposits in the Central Bank available to banks serve the same purpose - by accepting them, the regulator gains confidence that credit institutions will not distribute the deposited funds in the form of loans and provoke a rise in prices.
80%
all central banks of the world are conducting research in the field of digital currencies
Central banks keep records of money circulating in the country and abroad, denominated in national currency, and for this they calculate two aggregators: the monetary base and the money supply. Cash in circulation and bank funds in accounts with the Central Bank (correspondent, deposit and required reserve accounts) in total constitute the monetary base. If you add to this all bank accounts (except those owned by financial institutions), you get the money supply. It is banks, through their daily activities, that transform the monetary base (which, minus cash, is the Central Bank's obligations to them) into the money supply.
Waltonchain (WTC)
The Waltonchain token (WTC) is built on a blockchain that tracks radio frequency identification (RFID) data throughout the supply chain. Its total supply is 100,000,000 WTC. The coin is in 104th place on the Coinmarketcap list, with a market capitalization of $61.76 million. The maximum price of $46 was noted on January 27, 2022, but at this time the altcoin costs significantly lower - $1.48.
Through a crowdsale held in September 2022, 25 million tokens worth about $10 million were sold. Another 30 million coins of this Chinese cryptocurrency were reserved for mining rewards. By the way, when mining WTC, a combination of three consensus algorithms is used: PoW and PoS on the main network; PoL. in exchange with leading nodes. In fact, the Waltonchain network is a fork of Ethereum, so WTC is based on ERC-20 and is compatible with Ethereum wallets.
WTC cost chart
// Source: Coinmarketcap
In March last year, beta testing of the network began, ending in April 2022. The blockchain's native cryptocurrency is now traded in pairs with ETH, BTC, XRP and USDT on various exchanges such as Binance, Huobi, OKEx and CoinMex.
New order
The emergence of CBDC should reduce this role to nothing and effectively deprive banks of their current primary function. The issuing process will be transferred entirely to central banks, and current banking clients - people and companies - will be able to open accounts (probably, as in the cryptocurrency world, they will be called wallets) with the Central Bank of their country directly. What remains for commercial banks is not yet entirely clear. One scenario assumes that they will be tasked with checking clients for compliance with legislation, primarily aimed at combating money laundering. Now in most countries there are separate government bodies for such work, in Russia - Rosfinmonitoring.
Another challenge is to provide the technological infrastructure to convert money from one form to another, such as cash to digital and back again. It is also unknown whether banks will be able to retain their deposit and credit operations. Perhaps the Central Bank will take them too. Anticipating such developments, many credit institutions around the world are looking for alternative sources of income: developing fintech (providing financial services via the Internet and mobile applications) and forming ecosystems, buying up companies and creating projects in different sectors of the economy.
Photo: Ilya Pitalev / RIA Novosti
Apparently, much will depend on the approach chosen by each specific central bank that decides to implement a CBDC in its country. So far there are three such approaches. The first, direct one, provides for the transformation of the Central Bank into the only player in the banking market in the form in which it exists today. The regulator not only takes over the monopoly on the actual issue of money, but also single-handedly redistributes the available funds of some people among others in need. The second, indirect approach involves maintaining the current order, in which commercial banks receive all the main functions, and the Central Bank continues to be responsible for the stability of the exchange rate and inflation, and at the same time play the role of a market regulator.
Finally, the third, hybrid option means that traditional banks will continue to service payments, but all money in the country will be accounted for directly in wallet accounts with the Central Bank. In addition, the latter is responsible for the backup financial infrastructure, which can come to the rescue in the event of a failure of bank payment systems. At the same time, banks will not be completely deprived of the opportunity to open CBDC wallets for clients and will retain their current position as intermediaries. But, probably, the latter function will be divided between them and the Central Bank. So far, not a single central bank in the world is considering the second, indirect approach - all ongoing research and experiments are focused around the direct and hybrid ones. A separate variation of CBDC will be intended only for banks and will not be available to everyone else. With its help, financial organizations will gain access to loans from central banks, which are usually used only in emergency situations.
Aelf (ELF)
Aelf (ELF) is a blockchain cloud computing platform and is ranked among the top 100 cryptocurrencies on Coinmarketcap. The coin ranks 80th, with a value of $0.213 and a capitalization of $105.6 million. The total supply of Aelf tokens is 1 billion ELF. The peak price of $2,717 occurred in January 2022, immediately after a private ICO in December 2022, when a quarter of all coins were distributed. Investors included Alphabit, Blockchain Ventures, ChainFunder, Draper Dragon and FGB Capital. Of the remaining tokens, 120 million ELF was allocated for mining and marketing.
ELF cost chart
// Source: Coinmarketcap
The company managed to create an OS specifically for the development of the blockchain ecosystem. The Aelf testnet, considered the “next generation Ethereum,” launched in August 2022. The mainnet was scheduled to launch in early 2022, but is still in beta testing.
However, the advantages of the platform are already quite tangible: it is not only fast - up to 15,000 transactions per second, but also uses the same mainchain / sidechain architecture, which is implemented in projects such as the Lisk or ICON cryptocurrency. And while the main network uses DPoS consensus, each side chain can choose its own consensus protocol to determine how it interacts with the main chain. This is critical to enable interoperability with both blockchains and legacy data.
ELF is traded in pairs with BTC, ETH, USDT for over $31 million daily. Crypto exchanges that accept ELF include Binance, Huobi, OKEx, Allbit, Upbit and Bithumb.
Under control
Another feature of CBDC will be that each unit of currency will have an individual tag based on metadata - similar to the serial number of a banknote. Individualization of digital money may be required to control the targeted spending of subsidies: the state will ensure that the recipient of the benefit does not spend it on gambling or alcohol. Inexperienced investors may be warned against risky investments. In addition, smart contracts, currently used in transactions with cryptocurrencies, will become commonplace. A simple example: transferring payment to the seller’s account only after delivery of the goods to the buyer and checking its quality is an automated analogue of the letter of credit procedure, which takes a lot of time and involves a commission for the bank.
Among other things, authorities in different countries hope to make national economies more transparent by getting rid of shadow sectors that actively use uncontrollable cash. All income received in digital currency will go to the account of the employee, individual entrepreneur or company in the central bank, which means the government will know exactly how much taxes need to be paid on it.
Bank of Sweden
Riksbank. Photo: Arild Vågen / Wikimedia Commons
But there is another factor that experts talk about - the desire of different countries to increase their geopolitical influence through a kind of export of their digital money. Many assume that with the spread of CBDC, currencies will no longer be national and used by foreigners only to purchase goods and services in the issuing country, as is the case now (with the exception of a few reserve currencies, mainly the dollar, which are used for savings and settlements with third countries).
Any CBDC will be able to circulate anywhere, but transactions will be processed on the servers of the issuing state. This means that it will receive all information about transactions and tax information and will be able to sell it to the competent authorities of the countries of residence of foreign users - in addition to using it for its own selfish purposes. In addition, banks and companies from countries with a developed digital money system will be able to offer their services to their users, for example, financial or commodity loans on favorable terms, thereby displacing local competitors. CBDC and related technologies could become weapons of the new era, as a result of which the world will plunge into a new information-financial cold war. In this case, the status of the current main reserve currencies, the dollar and the euro, will be noticeably shaken.
Nebulas (NAS)
The next-generation decentralized platform Nebulas (NAS) provides a search engine for all blockchains and has its own token, which is listed on leading crypto exchanges such as Binance, OKEx, Huobi, Gate.io and others. At the moment, NAS is trading at $1.59 and is listed on the Coinmarketcap web service at 93 positions, with a capitalization of $77 million.
The coin debuted with a price of $2, but then the prolonged crypto winter made its own adjustments. The decline in the value of the altcoin forced the company to lay off 60% of its employees last year. As a result, the solution to the peripheral tasks outlined in its roadmap was suspended. Just 7 months earlier, the team managed to raise $60 million in an ICO.
NES cost chart
// Source: Coinmarketcap
The blockchain was created in 2022 on the basis of Ethereum, and the main network NOVA 1.0 started operating only at the beginning of April 2022. Nebulas Rank (NR) is the main algorithm on the platform, used to rank addresses, smart contracts, decentralized applications (dApps) and other objects on the blockchain. In addition, algorithms (DIP) and algorithms (PoD) are used. Nebulas also produces its own wallet software, available for download on the project's website.
The prospects of the coin are evidenced by the fact that it took 6th place in the Chinese ranking of public decentralized networks.
Rating of world public platforms
// Source: cena.com
Have questions
True, not all central banks are yet considering the possibility of using their future digital currencies abroad. This perspective is mainly favored by regulators who are responsible not for individual countries, but for associations. Among them are the European and Eastern Caribbean central banks. The latter is responsible for monetary policy in the eight countries of the regional monetary and economic union: Antigua and Barbuda, Grenada, Dominica, St. Vincent and the Grenadines, St. Kitts and Nevis, St. Lucia, Anguilla and Montserrat. The last two do not have full sovereignty and have the status of an overseas territory of Great Britain.
Digital Yuan logo
Photo: Ng Han Guan/AP
There is no direct mention of intentions to replace existing ones with a new type of money. Central banks of different countries and blocs, including the Russian one, declare that they will retain non-cash and even cash payments, it’s just that there will now be not two, but three monetary forms. The release of each unit of CBDC means the withdrawal of a different form of currency from circulation in order to avoid uncontrolled growth of inflation. The digital ruble, as stated, will have the same functions; it will be possible to replenish the wallet from a bank account, card, or even in cash - as well as make transactions in the opposite direction.
“The digital ruble will be able to make payments even faster, easier and safer. The development of digital payments and equal access to the digital ruble for all economic agents will lead to a reduction in the cost of payment services, money transfers and increased competition among financial organizations,” the Central Bank stated in last year’s release. It was also indicated that the introduction of the digital ruble will serve as an incentive for additional innovations in the field of retail payments.
Elastos (ELA)
Elastos (ELA) is one of the most ambitious and promising Chinese cryptocurrencies. Its goal is to create a new type of decentralized Internet, SmartWeb, based on blockchain technology. The platform also offers features such as identification, scalability and dApp building, which, by the way, are protected by Elastos Runtime. For example, the main blockchain is protected through PoW and uses Bitcoin computing power. In other words, by revealing a block in the Bitcoin blockchain, the miner simultaneously reveals a block in the Elastos blockchain.
Elastos held an ICO in 2022, but in February 2022, a group of investors accused it of fraud and filed a lawsuit in the New York Supreme Court for violation of the initial coin offering procedure. Regardless of how good or bad these accusations are, prices for the Elastos token immediately fell by 20% and continued to decline sharply throughout this year.
Today, this Chinese cryptocurrency costs $4.03, having dropped in price by almost 13% in 24 hours. In the Coinmarketcap ranking it ranks 101st by market capitalization of $62.9 million.
ELA cost chart
// Source: Coinmarketcap
Digital race
It is expected that the digital ruble will become accessible, and therefore the preferred means of payment in sparsely populated and remote areas - due to the fact that it will be possible to use it even without a connection. “Transactions with the digital ruble will be carried out both online and offline. For offline transactions, without access to communication networks, users will be able to pre-reserve a certain amount of digital rubles in their electronic wallet, just as they now take cash with them when traveling to places where payment cards may not be accepted,” explained the Central Bank.
The ECB speaks in approximately the same spirit. But, despite active work to create its own digital currency (the Russian regulator is going to test the digital ruble in January 2022), neither Russia nor the European Union are among the world leaders. They are Sweden and China. Beijing is preparing to introduce the digital yuan (officially Digital Currency Electronic Payment, or DCEP) at the Winter Olympics in February. Participants and tourists will be able to pay with it after purchasing a new type of money, for example, in a special terminal presented in early November.
Preparations for the Winter Olympics in Beijing, where the digital yuan will be introduced
Photo: Tingshu Wang/Reuters
During the trial period, lottery winners in four cities were given vouchers worth 200 digital yuan (about $30), which could be used to pay at select stores, cafes and online services. Moreover, in China they are still using a hybrid settlement scheme, in which commercial banks are also allowed to process transactions and keep records of CBDC of citizens and companies, but without charging fees for payments and transfers. For China, the issuance of a digital currency is extremely relevant and will help get rid of cash payments, because, according to statistics from the local People's Bank, about 20 percent of residents do not have bank accounts (even despite the highest popularity of payment services, the audience of which reaches a billion people).
Sweden, in turn, plans to complete testing of the digital krona by the end of 2022. Then the authorities will decide whether it is worth fully introducing it into the national financial system or whether it is better to limit it to partial use. The prevalence of cashless payments in Sweden is much higher than in China, and almost all residents have bank accounts. Last fall, the country recorded a record low share of cash payments—less than 10 percent of all transactions.
When is the launch?
According to a publication in China Daily on September 4, closed testing of CBDC with the participation of “certain commercial and non-governmental organizations” has already begun. An earlier publication by the same publication states that if successful, the project will launch before Libra. That is, this will happen no later than the first half of 2022, and according to Forbes, maybe even in November.
As already mentioned, the first users of the Chinese currency will be large state-owned banks, as well as Alibaba, Tencent and Union Pay corporations. One of the sources close to the NBK confirmed that the above-mentioned organizations are definitely participating in the project. However, much of the information is confidential and much remains unclear, such as what their role in this initiative will be.
According to the Chinese state publication Global Times, at first the new system will be launched locally, in the city of Shenzhen. The Tencent holding company is also located there, which, together with local financial institutions, will continue to develop a new means of payment.
It should be noted that the NBK's research division previously opened an institute in Shenzhen specializing in financial technologies and projects related to digital currencies. This institution is now actively recruiting various technical experts, including blockchain developers and cryptography specialists, who will also work in Beijing. In addition, the PBOC division has filed more than 50 patent applications detailing possible features of the Chinese digital currency.
Hidden
However, there is a country in the world that unexpectedly overtook all the recognized leaders and heavyweights in the financial industry and introduced its own CBDC a year ago. This is the Bahamas, a Caribbean state that gained independence from Great Britain only in 1973 and has since earned a reputation as one of the most popular offshore havens, where billionaires and corporations from all over the world hide their fortunes and assets from prying eyes. Companies registered in the archipelago are exempt from all types of taxes, provided that they conduct operating activities outside the country. Income from the services of lawyers and notaries working with foreigners amounts to 30 percent of GDP.
In October 2020, the Bahamian Central Bank, led by John Roll, issued the world's first CBDC, called the Sand Dollar and designed to complement the national currency, the Bahamian dollar. According to Roll, he realized the need for a digital version of his home country's currency when he saw the difficulties payment systems and their operators faced. The geographical location of the state significantly complicated their work: banks simply refused to service some islands, which were nicknamed family islands due to the small number and demographic composition of the population. Residents often found themselves cut off from a full-fledged financial system and forced to travel to neighboring islands to make basic transactions. Such trips could take from several hours to a whole day.
Bahamas
Photo: Dee Browning/Shutterstock
Another challenge facing banks and other financial institutions in the Bahamas is natural disasters. Hurricane Dorian, which hit the archipelago in 2022, has exacerbated the already low availability of banking services on the outlying islands. It took some credit institutions about a year to restore damaged branches. For several months, people were deprived of the opportunity to make non-cash payments, service loans, and conduct business. The storm also damaged cell towers, further complicating transactions through mobile banking apps. In such a situation, the ability to make transactions without connecting to the network, using the amount reserved in the wallet, became a salvation.
It is too early to talk about the widespread use of the “sand dollar” even within such a small state as the Bahamas (the population of the islands is 321 thousand people), despite the fact that immediately after the launch of digital money they began to be accepted for payment in all shopping centers in the country. The inhabitants of the islands are strongly divided along socio-ethnic lines. Representatives of certain groups may not communicate with outsiders, which makes innovation difficult. But gradually more and more banks and services are connecting to the system, which allows them to accept CBDC from clients. In October 2021, a year after the launch of the “sand dollar,” it was used for the first time to pay salaries. The food delivery service Bahama Eats decided to introduce this innovation by announcing a partnership with the mobile payment system Island Pay. By the end of the year, about 60 people receive salaries using digital wallets.
Zilliqa (ZIL)
Zilliqa (ZIL) is one of the fastest blockchains on the market, with its speed increasing exponentially as the network size increases. Sharding provides excellent network scaling, with a throughput of 1000 and even 2000 transactions per second. The Zilliqa cryptocurrency deservedly took 58th place in the Coinmarketcap rating. Today, the coin’s capitalization is $176 million, and the price of 1 token is $0.02.
If you look at the Zilliqa trading chart, you will notice that the coin reached its all-time high on May 10, 2022. Then the price rose to $0.23. However, on December 5 of the same year, the altcoin fell to its lowest point of $0.012.
ZIL price chart
// Source: Coinmarketcap
The platform went live in 2022. The idea of “sharding” is key to the project. It was implemented by dynamically dividing the nodes of the blockchain network into shards (subgroups). Each fragment is processed independently and reaches consensus using the secure Proof-of-Work (PoW) protocol. Shards can process transactions in parallel, thereby significantly increasing throughput. In addition, the Zilliqa team is also working on creating a new smart contract language, Scilla, that will be able to work with a wide range of applications such as automated auctions, collaborative economies, and financial modeling.
ZIL is currently listed on various exchanges including BITBOX, Binance, Huobi, Bithumb and OKEx. The most popular coin trading pairs include ETH, USDT and BTC.
LoopRing (LRC)
Loopring (LRC) is a Chinese cryptocurrency that experts suggest has an exciting future. The underlying protocol used by blockchain is “ring matching.” The transaction is not limited to the exchange between two parties. For example, a particular exchange transaction may be complex and involve a series of exchanges. With ring matching, each of these multiple requests can be executed as the same order/transaction on the chain.
“Matching Rings”
// Source: WhitePaper Loopring
The LRC token is an ERC-20 token. At the time of writing, the market capitalization of the coin is $50.7 million, and the cost of one altcoin is $0.053. In the Coinmarketcap rating, the coin is in 116th place.
LRC cost chart
// Source: Coinmarketcap
