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2020 kicked off radically different than everyone expected due to COVID-19. The whole economic system came crashing down and no sector – whether it be healthcare, retail or financial – was safe from the downturn effects of the coronavirus pandemic. Consequently, many people lost their jobs and found themselves in complete financial turmoil. That’s because our economy has been propped up for decades by a deceptively frail currency system. One that isn’t sustainable in the best of times, let alone during a pandemic. For many people, the coronavirus is making them question why the money system has failed them. How is it possible for banks to print unlimited money, which historically has shown to devalue a currency? People are looking for alternative ways to store and protect their wealth, particularly during a crisis. So, people are quietly turning to cryptocurrencies. On that note – let’s have a look at cryptocurrencies in Canada. The top 20 for 2020 to be precise: Bitcoin Bitcoin is the first (and most popular) cryptocurrency ever developed. It’s essentially digital cash and was developed in 2009 by its founder, Satoshi Nakamoto – who remains a mystery to this day. Bitcoin is run on a peer-to-peer network (meaning that you can send and receive Bitcoin without going through a bank). This allows for quick, reliable and safe transactions to be made. Eventually, Bitcoin would go on to pave the way for the rest of the coins, often referred to as alternative coins (or Altcoins for short). Most new investors have heard of Bitcoin – in fact, it’s synonymous with cryptocurrency and blockchain technology. There will only ever be 21 million Bitcoins in circulation. This scarcity is what helps to protect Bitcoin against hyperinflation, unlike the Canadian dollar which is unlimited. There’s always a demand for the coin, and it can easily be sold whenever you feel it’s the right time to cash out. What people often don’t know is where to begin investing in Bitcoin. If we take, for example, an investor wanting to buy Bitcoin, they’ll simply search for “how do I buy a Bitcoin in Canada,” rather than “what is a good cryptocurrency exchange in Toronto?” That’s because most new investors don’t know that you can buy cryptocurrencies in exchanges – which is an online platform for buying, selling and trading cryptocurrencies. If one were to look up a cryptocurrency exchange in Vancouver, they’d soon see despite all the options the most sensible way to get started in crypto is to buy Bitcoin. Ethereum If Bitcoin is Batman, then Ethereum is Robin. Ether is the cryptocurrency, while Ethereum is the blockchain that allows Ether to be traded. But most people use the two terms interchangeably. Ether is nearly as popular as Bitcoin, but offers more features like (complex) smart contracts that can execute once specific requirements are met. This can revolutionize how digital business and transactions are conducted. Large, mainstream corporations are looking at growing Ethereum-based companies. Companies like Toyota, Deloitte, Bank of Canada (and more) are supporting the Enterprise Ethereum Alliance (EEA). EEA is designed to promote and support Ethereum-based technology standards, architecture and best practices. So we will likely continue to see Ethereum be adopted to counter challenges in the world of business. XRP The cryptocurrency commonly referred to as Ripple is actually called XRP. Ripple Labs is the name of the company that created the coin, while XRP is the actual cryptocurrency. But to be fair, Ripple is much easier to remember than XRP. Unlike Bitcoin, that needs to be mined in order to exist in the economy, all 100 billion XRP that will ever be created already exist. Over the next few years, 1 billion XRP will be made available per month, effectively causing the circulating supply to increase in the years to come. Unlike Bitcoin Ripple is centralized because their goal is to be fast, secure and a reliable transactions solution for banks and major financial institutions. Regular investors, like you and I, are not their target audience. With a high level of security and partnership with a number of major banks like BBVA, Ripple is one to watch for the foreseeable future. Tether Tether is well branded as the name describes its unique purpose: bridging the gap between crypto and fiat currency as a tether between the two. Tether maintains the same value as the USD which makes it more predictable and manageable for businesses, while theoretically offering the same level of security of Bitcoin since it’s built on the same technology. Litecoin There’s little to differentiate between Litecoin and Bitcoin in terms of technology and application. Litecoin just happens to have more emphasis speed, so transaction times are noticeably faster, making it more suitable for high frequency trading. This could be a key factor in its future growth and as crypto transactions become more prevalent in crypto exchanges in Canada. Bitcoin Cash Bitcoin is the undisputed leader on nearly all cryptocurrency hubs in Canada and the world, but the long transaction process periods required to exchange it mean it’s somewhat less than ideal as a liquid currency. That’s where Bitcoin Cash comes in. Because its blockchain technology is scalable it can reduce processing times as well as transaction fees, making it more suitable to commercial transactions. QCAD Similar to Tether and DAI, which are USD stablecoins, QCAD is a CAD pegged stablecoin. Simply put, it’s designed to utilize a 1:1 CAD backing that means its creator company, Stablecorp, maintains a balance of 1 CAD for every 1 QCAD cryptocurrency in circulation. This could be the blueprint for digitizing conventional fiat Canadian dollars into a cryptocurrency. Zcash Zcash is something of an evolution in cryptocurrency on exchanges. It features more advanced security technology, but unlike Bitcoin is not limited to 21 Million coins. The main focus of Zcash is privacy though. It provides more anonymity to all sides of transactions by recording transactions without revealing identities or amounts. This in and of itself is an extra level of security against hackers and fraudsters. VeChain This is a crypto platform that is intended to streamline leveraging of coins by cryptocurrency merchants. Like Ethereum, VeChain has the potential beyond simple currency units, so its applications are wider than Bitcoin. Cardano Also seeking to tap into the endless application potential of blockchain technology, Cardano seeks to optimize all characteristics like transaction speed and interoperability, while maintaining a high level of security. It’s expected to offer smart contracts as well, which will make it a strong alternative to Ethereum. Monero This is a privacy-centric cryptocurrency available on many exchanges in Canada. Monero’s technology is believed to be untraceable which, along with high marks for security, make it a popular choice for those concerned with safety from hackers. Also positive for Monero is that it has a long track record and substantially large portion of the market. Tezos With a fairly large market cap, Tezos is a promising up-and-comer. It has faced a lot of volatility, but maintained a general upward trend compared to the crypto exchange index. EOS This crypto aspires to be all things to all users, combining the application adaptability of cryptocurrencies like Ethereum with more speed-oriented cryptocurrencies. EOS provides features that help draw up and execute contracts, while holding all parties to their contractual commitments. It also features a voting system so users can participate in any changes to the apparatus. DAI and Maker These two cryptocurrencies are intertwined. DAI is a stablecoin in that it is regulated by a platform to consistently maintain a $1 USD value. Using the same technology as Ethereum, Maker acts as the smart contract platform that backs and regulates DAI which users can borrow by putting up Ethereum as a collateral held in a decentralized smart contract. IOTA Cryptocurrency is evolving at a rate never before seen in technology. In keeping with that trend, IOTA is one crypto on the exchanges that aims to break new ground by solving scalability issues in the Bitcoin model. It replaces the traditional blockchains with the Tangle which reach consensus in the decentralized peer-to-peer system more efficiently. This ambitious goal has led to some security vulnerabilities, but as they are addressed and the technology is proven, IOTA shows great promise. Stellar The aim with Stellar is to generate digital representations of all kinds of assets including fiat currencies and other cryptos in Canada and all over the world. Stellar does this through its own built-in trading hub. Chainlink Most cryptocurrencies on the exchanges in Canada have some features that are meant to connect them to the world outside of blockchain, but Chainlink is all about that connection. Open-source API is used to develop software that supports the crypto market. Chainlink acts as a link between conventional payment tools and financial institutions like Paypal and banks, and a multitude of crypocurrcies. Achieving these ambitious goals would make it a prime candidate for massive growth in the years ahead. Dash Dash is unique in that it has a very clear administrative structure. A seasoned team of developers regulates its network. They opted to optimize performance by breaking down the mining operation between Miners and Master Node. This offers traders options like PrivateSend and InstantSend for their transactions, so they can opt for increased speed or added privacy depending on what transaction requirements are. Nexo This is not a crypto in a traditional sense. Nexo is designed to enable lending in digital currency. It’s a logical next step in the evolution of cryptocurrency. By taking advantage of unique blockchain features, Nexo allows those with digital assets to put up holdings as collateral for a crypto loan, all without a third party middleman like a bank taking a lion’s share of the transaction for no added value. The blockchain ensures transparency and holds all parties to their obligations without the added hidden fees of banks or other financial institutions. Thanks for reading. If you want to start trading crypto in Canada, you can sign up here.
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