In 2013, cryptocurrencies took the next step in their evolution when ether (CRYPT: ETH) was created. With the arrival of Ethereum, a new form of blockchain technology known as smart contracts would provide the basis for things like non-fungible tokens, decentralized exchanges, and yield farming. Now that it’s been a few years, the number of smart contract-based blockchains has grown. Newer cryptocurrencies like Cardano (ADA -7.54%), Solana (SOL -8.58%)and VeChain (VET -6.51%) have begun to use smart contract technology in their own unique ways and should be considered for a place in every investor’s portfolio.
Cardano
Neil Patel (Cardano): Cardano was created by Ethereum co-founder Charles Hoskinson in 2017, which immediately makes the blockchain project more interesting and credible as its leader’s pedigree helped create the world’s second most valuable cryptocurrency. As of August 24, Cardano has generated a gargantuan total return of more than 1,700%, despite falling 85% from its all-time high of $3.10 in September 2021. Today, Cardano is the 8th most valuable crypto with a market cap of $15.6 billion.
While Cardano a Proof of Stake Consensus mechanism, it works on two levels. The Cardano Computing Layer runs decentralized applications (dApps). smart contracts. And transactions are validated on the Cardano Settlement Layer. This innovative setup allows network congestion to be offloaded from the main blockchain, helping to speed up transaction processing times.
Cardano’s development process is unique in that it uses a research-driven stage-gate approach. This strategy, which draws on peer reviews from computer scientists and cryptographers at top universities around the world, could make Cardano slower to implement upgrades than other cryptos. But this approach helps minimize mistakes by thinking through potential risk factors.
The latest phase of development, called Goguen, brought smart contracts to the platform as a result of the Alonzo hard fork that was completed in September last year. This immediately made Cardano a direct competitor to Ethereum’s dominance in this space. And the current phase, known as Basho, is all about improving network scalability and interoperability. With the Layer 2 solution Hydra, Cardano can theoretically process a staggering 1 million transactions per second (TPS), surpassing Ethereum’s current capacity of 13 TPS.
As of this writing, more than 1,000 different decentralized applications are running on Cardano’s network, demonstrating its attractiveness to developers working on building services that bring utility to the blockchain. In addition, Cardano is showing promising enterprise-level solutions such as identity verification for financial organizations and counterfeiting prevention for retail businesses.
achievement of a Price of $1 per tokenroughly 117% above today’s price, is certainly on the table if Cardano can keep moving forward with its development roadmap and the growth of its dApp ecosystem.
Solana
Michael Byrne (Solana): Solana is an attractive platform for smart contracts thanks to the network’s lightning-fast speeds and low fees. Solana can achieve a throughput of around 65,000 transactions per second, although the average is typically around 3,000. Solana also offers sub-second transaction times. This high speed and capacity prompts Bank of America (NYSE:BAC) Analysts say Solana may be the “Visas (NYSE:V) of the digital asset ecosystem.” Solana achieves this speed by using a process called proof of history, where transactions are ordered and stacked before being processed through proof-of-stake consensus. The Solana network had nearly 2,000 validators as of July. far more than any other smart contract platform outside of Ethereum, making it more decentralized than other Layer 1 blockchains.
Additionally, Solana uses popular programming languages like Rust, C+, and C++, which means developers can build applications on the platform without having to learn a new language.
These characteristics make Solana an attractive platform for application development. According to data from crypto research firm Messari, the number of unique programs on Solana has exploded over the past year, with more than 1,000 programs having daily usage in July, up from less than 200 last August.
VeChain
RJ Fulton (VeChain): VeChain was originally an ERC20 token on the Ethereum blockchain, but switched to its own blockchain in 2018. Since then, the blockchain has partnered with some of the largest companies in the world to solve business challenges in a secure and instantaneous environment on the blockchain.
VeChain customers use their smart, contract-based solutions to track, automate, and account for goods as they move through supply chains. In an increasingly globalized world where products change hands multiple times before being purchased, VeChain offers an invaluable solution for businesses across multiple industries.
The list keeps getting longer, but VeChain has already formed partnerships with some of the most well-known brands around the world. automaker bmw (OTC: BAMXF) uses VeChain to manage data such as mileage, repairs and additional services of a vehicle. Walmart (NYSE: WMT) in China used VeChain as part of a traceability program that promotes transparency for consumers so they know exactly where their food is coming from. Pharmaceutical giant Bayer (OTC: BAYR.Y) used VeChain to build an application that tracks clinical medicines as they move through the supply chain. Luxury brand Givenchy adds microchips to its handbags so owners can verify authenticity. The world’s leading manufacturer of electric vehicles, BYD (OTC: WILL)uses VeChain to track CO2 certificates for drivers.
As companies continue to grapple with supply chain issues, VeChain could be used to maintain accuracy and track logistics for international products. The counterfeit economy is lucrative and is projected to reach nearly $1 trillion in 2022. With VeChain, companies can ensure authenticity and minimize cost impact more effectively.
The future for VeChain is bright as the world becomes more digital. If you’re looking to diversify your smart contract blockchain holdings, it’s difficult to ignore VeChain’s long-term value as more companies seek blockchain-based solutions.
Bank of America is an advertising partner of The Ascent, a Motley Fool company. Michael Byrne has positions at Ethereum, Solana and Walmart. Neil Patel has positions on Ethereum. RJ Fulton has positions in Cardano, Ethereum and Solana. The Motley Fool has positions in and recommends BYD, Ethereum, Solana, Visa, and Walmart. The Motley Fool recommends BMW. The Motley Fool has a disclosure policy.
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