The crypto market has had a banner year in 2018. Many people have made a lot of money buying and holding the top-performing cryptos, particularly Bitcoin and Ethereum. However, these days there’s been a lot of talk about the “great crypto winter.”
And it’s true—these past few months have seen quite a few coins lose more than half their value. It makes you wonder if this is the end for cryptocurrencies, or if it’s just another passing fad.
In any case, we’ll be looking at some of the best Layer 1 crypto projects to help you decide whether or not to invest in them during this bear market. These projects are all either already disrupting the world, or poised to make major waves in the years to come.
What Do We Mean By Layer 1 Crypto?
Layer 1 Crypto is basically the most basic form of cryptocurrency you can get. They provide a platform to allow anyone to pay or receive money from anyone else, regardless of their physical location. You can use these cryptocurrencies to pay for things like bills, groceries and utilities, just like paying by cash or credit card.
With a Layer 1 Crypto account, you can send and receive money to anyone with a Layer 1 Crypto account. You can withdraw your money in your local currency at any ATM machine in the world.
Layer 1 Crypto usually has some fees, but they are generally lower than credit cards and other bank transfers, while being much faster as well. Many places have stopped accepting credit cards and bank transfers due to high fees and slow transaction times.
A Comparison Between Layer 1 and Layer 2 Crypto Projects
Many projects claiming to be blockchain technology are actually doing something else entirely. There are two kinds of crypto projects: Layer 1 and Layer 2.
Layer 1 is a cryptocurrency, like Bitcoin or Ethereum. It’s a decentralized ledger that records transactions in a blockchain. Layer 1 is a blockchain platform that supports smart contract functionality, such as Ethereum and Bitcoin. These projects are building decentralized apps on top of Layer 1 technology using programming languages like Solidity and Go.
Layer 2 is an off-chain solution, like the Lightning Network or Raiden Network. It’s also a decentralized ledger, but it sits on top of the blockchain instead of inside it.
Layer 2 is a blockchain platform that relies on another blockchain for its base functions (such as a Layer 2 platform built on Ethereum). These projects are building decentralized applications on top of Layer 2 technology using programming languages like Solidity, but have the added benefit of increased transaction throughput due to off-chain scaling solutions like Lightning or Plasma.
Best Layer 1 Crypto Projects
Bitcoin: Launched in 2009, Bitcoin is the original cryptocurrency and blockchain project. Its popularity has led it to become the most valuable crypto by far, but its development team remains relatively small.
It’s currently undergoing a period of developmental stagnation due to the difficulty involved in making consensus changes. Despite this, Bitcoin remains relevant and popular because of its first mover advantage and large developer community.
Ethereum: Launched in 2015, Ethereum is a blockchain-based platform that allows developers to build smart contracts and dApps onto its underlying technology. The most well-known use case for Ethereum is the creation of ERC20 tokens which are built off of the Ethereum blockchain and have raised billions of dollars in recent years.
Despite this popularity, Ethereum has struggled with scaling issues and debates over how best to develop its network have slowed progress down considerably. It’s currently undergoing a period of developmental stagnation due to the difficulty involved in making consensus,
Solana is a layer 1 blockchain project that aims to build the most powerful, efficient and scalable distributed ledger technology (DLT) infrastructure for decentralized applications (dApps) of the future. Solana’s key innovation is the proof of time and commitment (PoTC) consensus protocol, which achieves “near-infinite scalability” by integrating a novel Byzantine fault tolerance (BFT) mechanism with a new proof of time into its consensus engine.
Solana’s mission is to enable developers to build the most performant dApps in the world. To do so, it provides a platform for dApp developers to integrate their projects with Solana’s blockchain infrastructure, allowing them to scale, while eliminating their need to develop all their own infrastructure.
Avalanche is a project based on Mimblewimble, which is one of the most promising solutions to scaling that has been introduced so far. This layer 1 solution will allow transactions to be both scalable and private while maintaining all the transaction characteristics of Bitcoin that make it function well as a currency.
Cosmos is a layer 1 protocol that lets anyone create their own token. The tokens will be used to trade on the Cosmos Hub, which is a multi-asset blockchain where you can trade tokens representing fiat currencies like the US dollar or cryptocurrencies like Bitcoin or trading pairs such as BTC USDT.
You can also trade other types of assets, such as commodities and shares of stock, or even more exotic things like weather data and concert tickets. The Cosmos Hub will also be able to support applications that need to use blockchain technology without necessarily needing to interact with the tokens on the blockchain directly.
Bitgert coin is an ERC2O token that has a great use case. Bitgert coin was made as a joke cryptocurrency that pays users in Amazon’s gift cards for mining it on the Ethereum network. It has recently been moved to the Ethereum Classic network and has already seen a nice boost in price since its move to this network. The reason behind this is that many people like the idea of having a token where they can get paid to mine it and sell it for USD or another currency.