on the crypto
Although the current cryptocurrency winter has been characterized by a gloomy and negative mood, the blockchain and cryptocurrency industry remains extraordinarily innovative. If nothing else, the ability to develop next-generation products and services might be easier now that there isn't the constant media hype to produce something immediately.
That's why I really like what I'm seeing with three different tokens that are changing the cryptocurrency landscape: Uniswap, Polygon and BitDAO. Each of these tokens is changing the way we think about cryptocurrencies, as well as helping lay the foundations for a stronger and more resilient cryptocurrency industry. Let's take a closer look at each of them.
Uniswap
With the continuing aftermath of the FTX cryptocurrency exchange crash, it is perhaps unsurprising that Uniswap is making headlines. Unlike FTX which is a centralized exchange, Uniswap is a decentralized exchange. This has several important consequences for the average investor who wants to avoid the risk of holding their cryptocurrencies on a potentially unreliable exchange.
The most important of these consequences is that you will never have to keep your funds on Uniswap to trade. Instead, the funds are held in a blockchain digital wallet that only you control. If you want to trade, you simply need to connect your wallet to Uniswap.
Another important consequence is that on Uniswap you have access to a much wider set of cryptocurrencies to trade than on centralized exchanges. This, combined with better prices for most cryptocurrencies, makes Uniswap's offer very attractive.
Uniswap faces a lot of competition, but remains the world's largest decentralized exchange by trading volume. It is also at the forefront of trading in other digital assets, such as non-fungible tokens (NFTs).
Polygon
What many investors may not know about Polygon is that it is a layer 2 blockchain built on top of the Ethereum blockchain, so there is a very symbiotic relationship between the two. Ethereum, as a base layer, provides security and stability.
Polygon offers faster transaction speeds, lower costs, and a superior user experience; it claims it can process 65.000 transactions per second at a cost of just a fraction of a cent. This makes it lightning fast and incredibly cheap, compared to Ethereum. Using Polygon, you truly get the best of both worlds: high speed, low cost, and full interoperability with the Ethereum blockchain.
Based on this unbeatable value proposition, Polygon exploded onto the scene in 2022. Over the course of the year, the blockchain fielded a number of high-profile partners, including Disney, Starbucks, Meta Platforms, and Nike. All of them are working on innovative NFT projects with Polygon, and this trend looks set to continue in 2023. Starbucks, for example, has built an NFT-based customer loyalty program that runs on top of Polygon.
BitDAO
BitDAO is unique in that it is a decentralized autonomous organization (DAO). Put simply, this means that it is an organization held together by a decentralized blockchain network. Every decision and every transaction of this organization is posted on the blockchain and coordinated via smart contracts.
This leads to enormous transparency and trust. Imagine if your boss, who works in the corner office, had to post a comprehensive list of every action taken during the day in a public ledger for all to see.
While each DAO can be set up to achieve different goals, BitDAO is set up to invest in different cryptocurrencies and blockchain projects. In many ways, it's like joining an investment club where you work with people from all over the world to choose your next investment.
Once you own a BitDAO token, you have the right to vote in this process. If you take a look at BitDAO's website, you can see some of the projects it has invested in, such as a new Layer 2 blockchain. If DAOs become more popular, they could change the way you think about blockchain investments and cryptocurrencies. Instead of investing in cryptocurrencies alone, the focus could shift to blockchain projects and digital assets.
Which of these is the best investment?
All three of these cryptocurrencies have attractive long-term growth prospects and rank among the top 50 cryptocurrencies by market capitalization. At the moment, Uniswap and Polygon are great long-term buys. As for BitDAO, however, the jury hasn't decided yet, simply because this type of crypto token is very new.
