5 Great Potential Layer 1 Crypto Assets Apart from BTC and ETH
Those of you who own crypto assets must be also familiar with Blockchain. While crypto assets are used for transactions and investments, the blockchain system consists of cryptography and blocks forming a network and recording data. But not much is known that Blockchain has 2 layers, namely layer 1 and layer 2.
What are Layer 1 Crypto Assets?
Bitcoin and Ethereum are layer 1 crypto assets which means blockchain, layer 2 is coordination with third parties. Layer 1 is the foundation of a decentralized data collection system which is generally a smart contract. If you know Bitcoin and Ethereum as Layer 1 crypto assets, there are other asset options that have the potential to be owned in that layer as well.
1. Binance Coin
This crypto-asset for decentralized finance takes advantage of being a more affordable version of Ethereum that is played by large-capitalized users. Its programming and coding is similar to that of ETH and expands its scope which neither Bitcoin or Ethereum has taken up.
The best thing about Binance is its accurate duplication with the ETH system. So, everything has to happen first on the ETH platform then if it proves to get a positive response, it will be adapted to Binance. It’s like, this is an affordable version of Ethereum with safer gameplay and of course less risk.
Read: Bitcoin Rainbow Chart
No one thought that Dogecoin, which is a derivative of Litecoin, could be popular and get a lot of fans. Now doge occupies the top 5 crypto assets traded. Initially Doge was used exclusively in certain communities which were generally intended to support fundraising and the like. Since being adopted by Elon Musk to be used for Tesla, Doge’s position deserves to be reckoned with.
The Doge system is not meant for serious things which actually makes it more interesting to own. Users use it with no high hopes and support its wide range of uses and it has proven to be very popular.
Polkadot combines the blockchain network with other blockchain networks or is known as a multi-chain network. Unlike a network that operates alone like Bitcoin. As a DeFi system, Polkadot is built to be compatible with other crypto assets. This fact makes DOT a popular choice over Bitcoin and Ethereum which are big players in layer 1 crypto assets.
While Binance is building a system similar to Ethereum, Cardano is focused on building a layered security system with a smart contract platform like Ethereum. This crypto asset takes one of the advantages of a superior coin and concentrates on that aspect so that it is widely known and makes it associated with that function.
Cardano’s approach is based on a scientific philosophy and academic research that also looks at securities to be applied to banks and other companies. Cardano’s uniqueness as layer 1 is the strict programming system that combines regulatory requirements with privacy.
The way Cardano works, which differs from Ethereum, even though both are Smart Contract platforms, is the convention mechanism and technical design framework. Cardano uses the Proof of Stake convention with Ouroboros. The mechanics will create blocks and make slot leaders based on automatic selection.
Ripple enables various cross-border transactions and adoptable crypto assets for the banking, financial and even personal industries. All done through a peer-to-peer platform in the blockchain. Ripple’s network system is known to be fast and low-cost, two important things that have given this crypto asset such a steady popularity.
Even XRP, the cryptocurrency that facilitates transactions on Ripple, uses less energy than Bitcoin. Ripple is so energy efficient that it uses far below Bitcoin. Because of this, this coin has become a favorite of major banks and financial services institutions around the world in transferring funds across borders
The Great Potential of Various Future Layer 1 Crypto Assets
Layer-1 crypto assets are the basic structure of the Blockchain which has a lot of potential to be developed. Changes are implemented according to market needs or as an improvement from the previous system for the better. Take for example Ethereum 2.0 which is an upgraded version of the previous format.
Some things that can be expected from layer 1 crypto assets are to create a special and specific function that can be compatible with other crypto assets. Things that could be improved include.
1. Consensus protocol changes.
Many crypto assets such as Ethereum are switching from the Proof-of-Work (PoW) protocol to the more efficient and faster Proof-of-Stake (PoS) protocol. Bitcoin and Ethereum both use PoW, where miners solve cryptographically difficult equations using their computing power.
Scalability is important for working on projects and collaboration. Sharding breaks down a set of transactions into smaller shards that can be processed online. So the way it works is much faster and can be measured easily because of its small size.
Layer 1 acts as a security system that stores durable data with secure stains. In the future, the security level will certainly continue to be improved to meet the demands of the users and also in accordance with the wishes of the developers.
4. Easy and Faster
Now layer 1 services are already fast and easy. But in the future, of course, it can be made easier to use and the service is faster than before. These two things that have always been the focus of users, especially large companies and news of developments to try to make services faster, will always get a positive response.
If you don’t have big capital, you can look at other layer 1 cryptocurrencies that are no less profitable. Even its performance can be more stable or reliable by looking at its various potentials in the future. At least crypto assets other than BTC and ETH are easier to make changes or adjustments because they are not as big as BTC and ETH.
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