Cryptocurrencies have been around for a long time: Bitcoin, the first cryptocurrency project launched in 2009. There are currently over 16,000 cryptocurrencies currently in circulation.
With each year, the awareness of cryptocurrencies has increased. But digital currencies are still an unknown quantity for the vast majority; most people are not fully aware of their full function.
NFTs hit the headlines in 2021; it was the word of the year and has become well known as some popular cryptocurrencies such as Bitcoin and Ethereum.
A cryptocurrency project has two components, the blockchain and a native coin associated with the blockchain. Blockchain is the technology, and the native coin is the digital currency.
NFTs are different from cryptocurrency, but NFT and cryptocurrency projects have many similarities. They both have a team or company working on developing and completing the project's aims.
Bitcoin is a blockchain, and the associated coins serve as a digital currency. Bitcoin as a blockchain is old technology and serves no purpose other than registering the transactions of its digital coins.
There are other crypto projects with more features than Bitcoin. For example, blockchains such as Ethereum, Solana, and Polkadot allow advanced information storage facilities on their blockchain.
XRP is the native token associated with Ripple; it plans to act as a money transfer utility at meager prices. Ripple and its native coin XRP, seek to compete with the fiat currency.
Tether is the native token linked with the Tether network; it's a stable cryptocurrency. While other cryptos face high volatility and swings in price, Tether is secure as it's pegged to the US dollar. It acts as a reliable medium of exchange and a way to store value.
All cryptocurrency projects strive to provide a service. As the oldest cryptocurrency, Bitcoin has the clout to act as nothing more than a digital currency. Other cryptocurrency projects aim to provide some form of value in addition to serving as an electronic currency.
This is similar to the utility feature of NFTs. NFT utilities can consist of events for the holders, play-to-earn games to ownership of virtual land. Owners gain other benefits in addition to the great-looking artwork stored on the blockchain.
A crypto project has a white paper to describe its aims and the achievements they seek to realize. All NFT projects have a white paper and roadmaps that state the project's ambitions.
All crypto and NFT projects try to build a community at the start; they do this through giveaways. NFT projects will try to provide free NFTs, while crypto projects offer free currency airdrops.
Building a community on Discord and using Twitter as the leading Social Media communication channel is a shared feature.
The blockchain Polkadot and the NFT project World Of Women have become successful projects. They do not need to make a significant effort to grow; the expansion takes place organically. Many external sources will discuss and market these projects, and people will readily engage.
NFTs use blockchains to register and record ownership details, and a crypto project helps facilitate the requirement. Crypto projects have enabled NFTs to become successful entities in their own right; without blockchains, there cannot be NFTs.
The success of NFTs has spawned a new industry. Entrepreneurs can pursue new lines of business, further employment opportunities, and an additional investing stream for investors.
NFTs have helped many crypto projects. The likes of Solana, Polygon, and Tezos have seen people using their blockchain in increasing numbers, which has led to a positive impact on these projects. The value of Solana coins was less than a dollar in early 2020; its price rose astronomically, reaching as much as $250 in 2021.
As well as giving the blockchain real-world use, NFTs have encouraged a new range of people to enter the crypto space. The cool-looking artwork attracted people who would not have entertained blockchain technology previously. It has led to people examining the broader crypto ecosystem and other projects in the crypto space. The user base of cryptos has increased.
Conclusion
Until recently, most crypto projects have been speculative with no real-world use. People could exchange cryptos as payment between themselves, but there is no central payment system like the traditional banking system.
NFTs projects, offering only artwork, have limited physical world use. But utilities such as play-to-earn games, casinos, and events change the landscape.
NFTs allow crypto-based blockchains to flourish and provide a beneficial effect. There is little doubt that both crypto and NFTs will see a greater prevalence and use in society with time.
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