In case you haven't noticed, interest in cryptocurrencies is growing. While tokens like Bitcoin and Ethereum have become household names, and make up the bulk of the total market cap, there are literally thousands of cryptocurrency investments out there.
Bitcoin, which is trading at more than $ 44.000, also started at a mere penny and took nearly three years to begin to surpass the dollar, reached in February 2011. Every great journey begins with small steps. While it's impossible to predict which tokens will have that kind of long-term success, there are some cryptocurrency investments under $ 1 with great potential. One of them is Hedera (CRYPTO: HBAR). But can it reach $ 1?
What is Hedera?
If you are not familiar with Hedera, you are not alone, but it is a cryptocurrency worth knowing. Hedera is an alternative to traditional blockchain networks that has some unique advantages.
Hedera is a publicly distributed ledger that is not built with a blockchain, but rather with a distributed consensus hashgraph algorithm developed by Hedera's co-founder and chief scientist, Leemon Baird. Hashgraph technology stores hashed data within a graph as opposed to blocks. With hashgraph technology, each container (the infrastructure that holds the applications) is embedded in the ledger, with none being discarded. All branches of the hashgraph continue to exist forever, entwined into a single whole. It is designed so that the more transactions there are on the hashgraph, the faster the transactions are verified.
To do this, it relies on a verification method different from the traditional proof-of-work blockchain used by Bitcoin and Ethereum. With this system, the community of nodes (computers that connect to the cryptocurrency) on the hashgraph reaches consensus on both the validity and timestamp of each transaction through gossip about gossip and virtual voting protocols. Gossip gossip is a variation of the gossip protocol, which is a way of sharing information between nodes to validate and record the transaction.
Hedera is not built on Ethereum, as it has its own source code. Furthermore, it is governed by the board of directors of Hedera. The board, whose members have duration limits, makes key decisions on software updates, network pricing, and treasury management, among other things.
Hedera is built to process transactions at higher speeds and lower costs than its competitors. It can handle 10.000 transactions per second, which is a lot more than Bitcoin or Ethereum, and can confirm transactions in three to five seconds. It has an average transaction fee of $ 0,0001 and uses a miniscule amount of power. Additionally, Hedera is validated as an Asynchronous Byzantine Fault Tolerant (ABFT), which is considered the highest level of security for distributed systems.
Of course, the speed and security of the systems is a big plus, but one differentiator that shouldn't be overlooked is Hedera's energy efficiency. Crypto mining has come under scrutiny by federal lawmakers for its huge energy consumption and contribution to climate change. Through the hashgraph consensus model, Hedera avoids energy-intensive proof-of-work crypto-mining.
Hedera would be in great advantage if federal lawmakers placed restrictions on the use of energy on crypto mining.
Hedera has a quotation of just $ 0,26 after hitting a high of $ 0,57 in September 2021. It has a market cap of $ 4,7 billion, making it the 33rd largest cryptocurrency.
Will it reach $ 1 by the end of 2022?
Given the uncertainty and potential regulation of the market right now, it is difficult to say when this will be achieved. But it's definitely worth keeping an eye out for as it has some key benefits that could serve it well in the long run as the market evolves.