2 High Cryptocurrencies I Would Purchase Earlier than Shiba Inu Coin – Motley Idiot

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Shiba Inu (CRYPTO: SHIB) was a hot topic last year. The meme token that cleverly took its name from Dogecoin‘s canine mascot, soared 42,000,000% in 2021. In other words, if you had invested $ 10 in Shiba Inu last January, your tokens would have been worth over $ 4 million by the end of the year. What’s even more impressive is that Shiba Inu has actually lost 62% of its value since its high in late October. To say his performance was unprecedented would be an understatement.

However, if you failed to make a fortune with Shiba Inu, don’t beat yourself up. More importantly, think very carefully before buying the dip. The chances of a repeat in 2022 are practically non-existent. Meme tokens are inherently unpredictable and, by definition, lack usefulness in the real world. Shiba Inu is no exception.

Building on this idea, there are dozens of other cryptocurrencies that I would buy before adding Shiba Inu to my portfolio. and avalanche (CRYPTO: AVAX) and Cardano (CRYPTO: NO) are at the top of this list. Here’s why.

Digital token consisting of 1 and 0.

Image source: Getty Images.

1. Avalanche

The Avalanche blockchain is a developer-friendly smart contract platform. If this term is unknown, smart contracts are simply computer programs that run automatically when predefined conditions are met. More importantly, they are key to building decentralized applications (dApps), including Decentralized Financial Products (DeFi), a type of software that resides on a peer-to-peer network rather than on central corporate servers.

Avalanche is secured by Snow protocols, a type of Proof of Stake (PoS) that allows the platform to validate transactions quickly. Just like other PoS blockchains, validators must use ADA tokens to participate in securing the network, but instead of requiring each node (computer) to review every transaction with every other node, the Snow protocols allow it to go through repeated and random samples of a small subset of nodes. Because of this, Avalanche can process 4,500 transactions per second (TPS) and these transactions complete in less than 2 seconds. This makes Avalanche the fastest smart contracts platform in the blockchain industry in terms of finality (i.e. the point at which transactions are irreversibly added to the blockchain).

Why does that matter? Many programmable blockchains are burdened by a lack of scalability. Case study: ether is by far the largest dApp and DeFi ecosystem, but the platform can only handle 14 TPS and it takes six minutes for those transactions to be final. As Ethereum-based dApps and DeFi products continue to grow in popularity, the resulting network congestion has led to an increase in transaction fees, creating significant headwinds for mainstream adoption.

Avalanche seems to have solved this problem, and that translates into popularity. In fact, despite going live in 2020, Avalanche is already the fourth largest DeFi ecosystem with $ 12.1 billion invested in the platform. More importantly, it’s compatible with Ethereum dApps, which means developers can easily deploy their programs on both blockchains. It is precisely this quality that could be a major growth driver in the years to come.

Regardless, the demand for the AVAX token should increase as more and more people use dApps and DeFi products on Avalanche, resulting in a higher price. That’s why I would buy this cryptocurrency every weekday before Shiba Inu.

Person touching a digital dollar sign overlaid with 1 and 0.

Image source: Getty Images.

2. Cardano

Cardano is a programmable blockchain based on the ADA token. Like other smart contract platforms, it was designed as an ecosystem of dApps and DeFi services, although the development team took an unusually strict approach. For example, Cardano is backed by a proof-of-stake consensus mechanism called Ouroboros, the industry’s first peer-reviewed blockchain protocol. In fact, the development team often submits new features for academic peer review, taking a very methodical approach.

The Cardano project itself is divided into five different phases: providing the basic blockchain, decentralizing the network, introducing smart contracts, scaling the network and implementing a long-term governance solution. The project is currently in the third phase, as smart contracts went live on September 12, 2021. This event could be a major catalyst in the months and years to come, as developers can now create dApps and DeFi products on the Cardano blockchain.

Of course, that won’t mean much if Cardano lacks scalability. Fortunately, the team plans to address this in the fourth phase of development, when the consensus protocol is updated on Ouroboros Hydra. Like the mythical multi-headed serpent, Hydra adds side chains (i.e., additional blockchains) to the core chain, thereby sharing the network load more efficiently. Think of it this way: Companies are divided into several departments so that small groups of employees can focus on specific tasks. That is more efficient than commissioning every employee with every job. Side chains serve the same purpose. Once complete, Cardano’s throughput could theoretically reach 1 million TPS.

As a caveat, Cardano is far from the only blockchain hoping to be the next Ethereum, but its evidence-based development approach sets it apart from other projects. And if Hydra’s rollout goes as planned – an event expected in late 2022 or 2023 – Cardano’s scalability would likely make it very popular with both developers and consumers. And as the demand for dApps and DeFi services on its blockchain increases, the demand (and price) for the ADA token should also increase.

This article represents the opinion of the author who may disagree with the “official” referral position of a premium advisory service from the Motley Fool. We are colorful! Questioning an investment thesis – even one of our own – helps us all reflect critically about investing and make decisions that will help us get smarter, happier, and richer.


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