If you are looking to buy cryptocurrencies that can stand the test of time, investing in Ethereum (CRYPTO:ETH), Tron (CRYPTO:TRX), and Tezos (CRYPTO:XTZ) makes perfect sense. Let’s see why these three digital assets are well poised to deliver outsized gains to long-term investors.
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Ethereum
Valued at a market cap of US$339 billion, Ethereum is the second-largest cryptocurrency in the world. Ethereum enjoys a first-mover advantage, as it was the first blockchain network to support decentralized applications, or dApps, which are self-executing smart contracts.
The Ethereum network leads the dApp category that includes DeFi (decentralized finance), as the blockchain accounts for 54% of the market with US$117 billion in TVL, or total value locked.
Ethereum also hosts OpenSea, which is the largest marketplace for non-fungible tokens with a 24-hour trading volume of US$75 million. Further, Ethereum developers are working on a network upgrade, where the blockchain will now validate transactions using a proof-of-stake mechanism.
Here, validators will verify transactions by staking their coins instead of solving complex puzzles. The shift towards a PoS mechanism will allow Ethereum to increase its scale and reduce costs related to transactions by a wide margin.
Tezos
Valued at US$2.5 billion by market cap, Tezos has more than doubled investor wealth since the start of 2020. Similar to Ethereum, the Tezos network also supports the execution of smart contracts. The people who own the XTZ token can vote on protocol upgrades, making it inclusive in nature.
Tezos is well poised to benefit from the widespread adoption of its blockchain network. In Q4 of 2020, Tezos disclosed that Societe Generale plans to use its network to create a digital currency in partnership with a central bank.
Further, cryptocurrency exchanges, including Coinbase and Binance support the staking of Tezos where users can earn a passive-income stream based on the amount of XTZ tokens they hold.
Last week, Tezos announced its blockchain network can now execute 1,000 transactions per second. Comparatively, Ethereum’s network can execute around 30 transactions per second.
Due to its smaller size, the risks associated with investing in Tezos is higher. However, it may become the preferred network of choice for those looking to develop financial products on a blockchain.
Tron
The final cryptocurrency on my list is Tron, which is valued at US$6.3 billion, by market cap. In the last three years, the TRX token has more than tripled in market value. The Tron ecosystem has close to 90 million on-chain users and has executed over three billion transactions to date. In Q4 of 2021, the Tron blockchain was completely decentralized and restructured into the Tron DAO (decentralized autonomous organization).
Last year, Tron launched the USDD on its blockchain, which is a stablecoin pegged to the U.S. dollar. The USDD protocol will keep USDD stable at 1:1 against the USD on the back of a robust algorithm framework.
Additionally, Tron’s blockchain has the capacity to execute 2,000 transactions per second, as it aims to create a decentralized environment for content creators.
Investors should understand that investing in cryptocurrencies carries significant risks, and they should invest as much as they can afford to lose in this disruptive asset class.
