Allow me to start this list of cryptocurrencies that aim to build the next generation of connectivity solutions with a concession. Over the last several months, I’ve been concerned about the viability of digital assets — and at these deflated levels, I had a right to be. However, it’s always possible that the sector could swing higher, which could particularly benefit so-called Web 3.0 cryptos.
The latest iteration of the broader internet evolution, Web 3.0 takes the advancements of the second phase — most notably integrated search engines and informational platforms — and takes it to greater plateaus through disruptive concepts such as decentralization and open-source utility. Web 3.0 cryptos are undergirded by blockchain networks that cater to this paradigm shift.
While it’s difficult to describe Web 3.0 cryptos in just a few sentences, the primary catalyst behind the innovation is control. Under the Web 2.0 hierarchy, big technology firms dictated how your data was used. Under this latest iteration of the internet, you choose the implications behind your digital footprint. Better yet, many projects associated with Web 3.0 cryptos allow you to profit from your data.
Though the concept itself is instantly compelling, the problem with this advancement is investor sentiment. Right now, markets are in flux due to Russia’s invasion of Ukraine, and Web 3.0 cryptos (and all investment categories) have experienced a shock to the system.
Nevertheless, the response from Ukraine President Volodymyr Zelenskyy and the Ukrainian people have inspired the world. From Los Angeles to Paris to Tokyo to even Moscow, the international community has united against this unnecessary invasion. It may be exactly what humanity needs to stamp out this affront, which is why these Web 3.0 cryptos could benefit from both fundamental catalysts and a feel-good narrative:
- Filecoin (FIL-USD)
- Zcash (ZEC-USD)
- Kusama (KSM-USD)
- Livepeer (LPT-USD)
- Audius (AUDIO-USD)
- Helium (HNT-USD)
- Flux (FLUX-USD)
Now, you should be aware that virtual currencies are incredibly risky, having demonstrated an ability to turn on a dime. And the catastrophe in Eastern Europe is truly unpredictable. However, the Ukrainian resistance is creating a hopeful atmosphere. Thus, I’m willing to entertain the possibility of Web 3.0 cryptos as a long-term investment.
Web 3.0 Cryptos: Filecoin (FIL)
One of the most intriguing Web 3.0 cryptos available, Filecoin could be a massive discount from its recent record-breaking high. A decentralized storage system, some analysts regard the platform as the filing cabinet for the next generation of connectivity platforms.
Similar in principle to cloud-based storage solutions, Filecoin differs from platforms like Amazon (NASDAQ:AMZN) or Cloudflare (NYSE:NET) in that data is stored in a decentralized network, thus protecting data integrity and mitigating efforts at censorship.
But perhaps the most important factor driving Filecoin is that the system allows anybody with extra storage space in their computer to contribute said capacity to the underlying network. In exchange for being a component of a decentralized content delivery network, Filecoin users can accrue cryptos as a reward.
Of course, the valuation of these cryptos will depend on market sentiment, which is a key vulnerability of decentralized protocols. Still, Filecoin demonstrates how internet users can detach themselves from centralized digital solutions.
An easy-to-appreciate misunderstanding is that all virtual currencies are anonymous. However, CoinMarketCap states that a majority of coins and tokens are pseudonymous. While “they do not explicitly reveal the identities of their users, each user has their own public address or addresses which can be traced back to them via the methods of data science and blockchain forensics.”
On the other hand, Zcash is different. Because ZEC transactions don’t reveal sending and receiving addresses nor the amount being transferred, Zcash is much more catered to digital privacy, making it an ideal choice for those whose lives are fully integrated with the internet.
While private anonymous transactions may raise alarm bells for law enforcement agencies and regulatory bodies, the reality is that multiple reasons exist for desiring discretion with your Web 3.0 cryptos. If you happen to be a Zcash billionaire, you probably don’t want to broadcast that fact to the world, especially when you’re moving money around.
Web 3.0 Cryptos: Kusama (KSM)
At the peak of its power, Kusama coins were trading hands at just over $600 a pop. These days, consumer inflation woes and geopolitical flashpoints have succumbed the per-unit price to less than $140 at the time of writing. Still, this erosion might be a discounted opportunity, provided you’re the patient type.
An interoperable and scalable blockchain network, Kusama bills itself as an experimental platform. Per CoinMarketCap, the “platform is designed to provide a testbed for developers looking to innovate and deploy their own blockchain and can be used as a preparatory network.” Basically, Kusama provides a framework to spark innovation — and many developers stay on the KSM network rather than shifting over to another blockchain.
Another factor that boosts Kusama as one of the more intriguing Web 3.0 cryptos is its nominated proof-of-stake (NPoS) consensus system. In short, the NPoS protocol provides an alternative consensus mechanism for verifying transactions and is far less energy intensive than the traditional proof-of-work (PoW) protocol.
Over the last few years, debate has raged about the role of censorship in mainstream media and social media platforms. On one hand, a reputational and moral catalyst drives companies to clamp down on commentary and content that’s disseminated on their channels, which on the internet can get awfully vile due to digital anonymity.
But on the other hand, media giants have incredible power, which raises the question: Who watches the watchers? With Livepeer, the people decide what voices will be heard through the democratic power of the free market. Seeking to disrupt the broadcasting industry with blockchain technology, Livepeer utilizes multiple decentralized applications to foster censorship-free journalism.
Of course, with that comes the responsibility of free speech, which is going to be a massive debate moving forward. Yes, censorship-free media is “good,” but such platforms are also vulnerable to an influx of fake news. Pretty soon, you might not know what’s real anymore.
Still, maybe it’s time to give decentralized media a chance?
Web 3.0 Cryptos: Audius (AUDIO)
If you thought the health insurance ecosystem was complicated, you might want to take a step into the music industry. With multiple layers and interconnected relations, many artists find it difficult to navigate. But that’s also where Audius comes in center stage.
According to CoinMarketCap, “Audius was launched to remedy the inefficiencies of the music industry, which is plagued by intransparent music rights ownership and intermediaries standing between artists and their audience.” Basically, the network provides a decentralized platform for artists to share their music with the world. Future developments are expected to allow artists to post paid content in exchange for stablecoins.
Therefore, Audius is similar to Spotify (NYSE:SPOT), with the exception, of course, that the former is a self-reliant ecosystem. As well, artists can upload content without fear of censorship or being removed from the platform.
Again, the lack of censorship is a double-edged sword as some content arguably should be censored for the greater societal good. However, as part of the growth in Web 3.0 cryptos, AUDIO could be worth consideration.
As digitalization expands in scope and scale, the Internet of Things — or the integration of connectivity technologies with various devices — will only become more relevant. Thus, the concept of Helium is an organically enticing one for Web 3.0 cryptos.
Billed as a decentralized blockchain-powered network for IoT devices, Helium — which was launched in July 2019 — allows for low-powered wireless devices to communicate with each other and send data across its network of nodes, per a description by CoinMarketCap. In short, Helium’s goal is to prepare IoT communications for the future through identifying inadequacies in current infrastructures.
Another intriguing fact behind Helium is that the network deploys a novel protocol called proof of coverage, a consensus algorithm that facilitates transactional consensus when connection quality is highly variable.
It’s quite possible, then, that Helium could have significant implications for emerging markets, where communication infrastructures might not be as robust as in developed regions. Still, caution and due diligence is always advised with Web 3.0 cryptos — or any asset within this broader investment category.
Web 3.0 Cryptos: Flux (FLUX)
Defined as a “new generation of scalable decentralized cloud infrastructure,” Flux is one of the most powerful among Web 3.0 cryptos. Facilitating development, management and spawning of applications on multiple servers simultaneously, the Flux platform is particularly useful for decentralized applications, or Dapps.
In addition to its rapid scalability, Flux features a Blockchain as a Service (BaaS) business model, which is similar to Amazon’s AWS development ecosystem. Of course, the key difference for Flux is that its platform is decentralized as well as interoperable.
As is the case with every other blockchain network, Flux node operators are rewarded with its underlying namesake cryptocurrency. However, what makes this platform especially intriguing is that Flux users are able to earn other cryptos by hosting certain Dapps on their nodes.
Essentially, the platform features a level of integration and self-sufficiency that has been lacking in early generation blockchains. While this innovation is no guarantee that FLUX will move higher, it’s something to keep in your back pocket.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.