The U.S Republican House Campaign Division to Accept Crypto Donations

The National Republican Congressional Committee recently announced that they would start accepting donations in cryptocurrencies. By doing so, they have become the first national political party committee to be taking contributions via cryptocurrencies.

Before this, U.S. political candidates like Emmer and former presidential hopeful Andrew Yang have also accepted crypto donations. However, a national political party engaging in cryptocurrency is a reassuring move, considering the state of Bitcoin in the United States a few years back.

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What Happened?

The NRCC has partnered with BitPay for facilitating all the cryptocurrency donations. They will, however, not hold any cryptocurrencies. Instead, all the donations will be converted to U.S. dollars before it hits the committee’s bank account, enabling more money to flow into their donation trunk.

In 2014, the Federal Election Committee had approved a $100 value for transfers of actual cryptocurrency, but now, since the cryptocurrencies get converted to U.S. dollars, the NRCC can accept individual donations of as much as $10,000 per year bypassing the FEC’s cap.

 “We are focused on pursuing every avenue possible to further our mission of stopping Nancy Pelosi’s socialist agenda and retaking the House majority, and this innovative technology will help provide Republicans the resources we need to succeed,” Axios cited NRCC Chairman Rep. Tom Emmer (R-Minn.) as saying in a statement.

What Does This Mean?

  • The National Republican Congressional Committee soliciting donations via cryptocurrencies may help in boosting people’s confidence around the topic. It has brought a lot of attention to cryptocurrencies, pushing them further towards the mainstream.
  • It is also a forward step towards bringing favourable regulations around cryptocurrencies, which might also translate to other countries following the same path.

If anything, the news indicates the growing familiarity and interest of people and committee’s in cryptocurrencies.

P.S: KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing.

Before all else, Congratulations to you, Kuberian! The RBI itself has come forward to clear the air around cryptocurrencies 🙂

Over the last few weeks, several banks from all over the country were turning their backs to cryptocurrencies by referring to the 2018 RBI circular against cryptocurrencies. They were doing so because of a lack of clarity on the subject matter. As soon as this caught the central bank’s eyes, RBI took this moment to address the ambiguity.

 They immediately rolled out a fresh circular on 31st May 2021 that said:

It has come to our attention through media reports that certain banks/regulated entities have cautioned their customers against dealing in virtual currencies by making a reference to the RBI circular dated April 06, 2018,” the central bank said.

“Such references to the above circular by banks/ regulated entities are not in order as this circular was set aside by the Hon’ble Supreme Court on March 04, 2020. As such, in view of the order… the circular is no longer valid from the date of the Supreme Court judgement, and therefore cannot be cited or quoted from,” RBI said.

After explicitly specifying that the old circular does not stand valid since March 2020, the Reserve Bank of India suggested that banks may carry on their dealings in cryptocurrencies as they would under existing regulations.

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What does this mean?

  • Banks can no longer refer to the old circular and flag crypto transactions made by you.
  • They cannot cite the 2018 circular and warn you against crypto transactions.

We are thankful to RBI for bringing about the much-needed clarity to cryptocurrencies. 

After positive responses like this, including the MCA announcement and the government’s keenness to set up a new panel for exploring crypto regulation; It would be safe for us to say that it’s only onward and upwards for cryptocurrencies from here.

P.S: KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing.

Bitcoin ETFs is to Bitcoin what Mutual Funds are to stocks.

You may have heard this advice at least once, that if you don’t know much about the markets and still want to dip your toes –  invest in Mutual Funds. It’s the same logic with Bitcoin ETFs; investors invest in Bitcoin ETFs to get their feet wet with Bitcoin.

It allows them to relish the returns from Bitcoin’s growth without having to directly invest in it. 

What’s the Difference Between Mutual Funds and ETFs?

The fundamental difference between a mutual fund and an ETF is that an ETF is more simplified. It allows you to invest in specific stocks and markets. In contrast, a Mutual Fund offers a broader range of assets under one bucket. It invests your money across industries and stocks and is actively managed, constantly revising the assets in the fund. 

For instance, an ETF gives you the flexibility to invest in a TATA motors stock or the entire automobile sector. However a Mutual Funds allocates your money between varying stocks of different industries.

ETF cater to an audience that wants exposure to specific assets and sectors, while Mutual Funds is more scattered. Additionally, Unlike Mutual Funds, ETFs can be traded on the open markets.

How Different or Similar Is Bitcoin ETF from the Regular ETFs?

Before we jump the gun and move to explore Bitcoin ETFs, let’s take a step back and first learn what ETFs are. 

What is an ETF?

ETFs or Exchange Traded Funds are investment tools mocking the value of its underlying asset or a group of assets.

The best example to understand this would be gold ETFs. Investing in gold ETFs allows you to put your money in a fund that replicates the movement of actual gold, and the same can be traded on the commodities market.

When you invest in an ETF, you aren’t directly investing in any asset but are investing in a fund linked to the asset.

How Does Exchange Traded Funds Work?

An ETF is managed by an investment firm that buys and holds the assets pegged to the ETFs. 

In the above example, the firm issuing gold ETFs buys an equivalent amount of gold and stores it before listing the ETFs on the traditional markets. Once the ETF is listed, you can buy and sell it just like any other stock.

What Are Bitcoin Exchange Traded Funds ( Bitcoin ETFs)?

Similarly, Bitcoin ETFs also allows you to reap the high benefits of investing in Bitcoins without having to really invest in it.

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The issuing company here buys and stores actual Bitcoins before going ahead and issuing Bitcoin ETF’s. Since these companies are trading on traditional markets, you need not go through an exchange to buy a Bitcoin ETF. You can easily buy, sell and trade Bitcoin ETFs on conventional markets.

Bitcoin ETFs also gives you the option to either invest in a fund holding Bitcoin only or be linked to a fund with a basket of investments, including Bitcoin. A hypothetical example of it would be; a Bitcoin ETF would consist, shares of companies like TATA and Reliance along with a portion of Bitcoin. It allows you to further mitigate the risk.

It lifts off the hassle from investors of owning, storing and protecting their Bitcoin investment.

Advantages and Disadvantages of Bitcoin ETFs

Let’s understand this entire concept of Bitcoin ETF in a more rational sense by weighing the pros and cons.

Advantages of Bitcoin ETFs 

1. Better Than Traditional ETFs

In traditional ETFs, though the ETF is following an assets price, the dividend you receive from investing through an ETF would be comparatively less than what someone would get if they had invested directly.

While in Bitcoin ETFs, since it is decentralised, the question of splitting the profit does not arise. Your ETF will be valued equivalent to Bitcoin’s value, and you can redeem it anytime you want after selling.

2. Convenient

Bitcoin ETFs are comparatively more convenient than actual Bitcoin. You can leverage the asset without having to burden yourself with owning and storing it. Additionally, it can be sold on traditional markets without the assistance of a cryptocurrency exchange.

3. Helps you Diversify

As said above, some ETF funds allow you to either fully invest in Bitcoin only or diversify and mitigate your risk by having a scattered fund. Hence, you can either invest in Bitcoin only or allot a portion of the fund to Bitcoin and have stocks as well in the ETF, thus diversifying your investments. 

Disadvantages of Bitcoin ETFs

1. Lack of Ownership

By being independent of third parties, Bitcoin is centred around being in charge of your own money. However, investing in ETFs takes that away from you. Thereby, blockchain’s anonymity and the ability to trade Bitcoin for services or other cryptocurrencies is out of your reach.

2. Higher Fees

Buying Bitcoin ETFs could be expensive; there’s no flat charge that you incur. Instead, your cost varies based on the sum you invest in ETFs and the funds you invest in.

3. Returns will Vary

Depending on the fund that you have invested in, if your Bitcoin ETF is diversified between stocks and Bitcoin, your ETF may not precisely replicate the returns of actual Bitcoin. For instance, if Bitcoin soars 30%, your ETF might not reflect a 30% growth. It will calculate your returns based on the share of Bitcoin in your ETF.

Now that you know the upsides and pitfalls of Bitcoin ETFs, it would be fair to question why have Bitcoin ETFs in the first place and why not directly buy Bitcoin.

Why Not Invest in Bitcoin Directly?

Bitcoin ETFs are for those who don’t want to have the responsibility of owning a Bitcoin. Otherwise, it doesn’t really stand out to be any better than owning actual Bitcoin.

However, an ETF could mean differently for different types of investors.

Bitcoin ETF for Retail Investors?

There is no reason for retail investors to think about taking the ETF route. They already have a very simplified way to invest in Bitcoin. They can set up their account in under 5mins on cryptocurrency platforms like CoinSwitch Kuber that allows them the convenience of storing their Bitcoin on the platform while promising the highest level of security. 

Bitcoin ETFs would just make a simple path complicated and expensive for retail investors. Additionally, you would incur the management fees of ETFs, which might offset all your gains. 

Bitcoin ETF for Institutional Investors?

However, for institutional investors, ETFs makes much more sense because they invest millions of dollars in Bitcoin. They would not want to risk its security, nor would they want to directly get impacted by its volatility. As a result, the fees and ownership aspect of it doesn’t bother them.

Secondly, the whole concept of ETFs is centred around giant investors and not everyday investors. Consequently, over 90% of the ETF’s market is dominated by institutional investors. 

Where to buy Bitcoin ETFs?

Bitcoin ETFs are gaining popularity among legacy banks as more and more companies invest in Bitcoins. With the very first ETF being launched no more than two months back in Canada. Large financial companies and banks like Fidelity and Goldman Sachs have also filed a request with the SEC (Securities and Exchange Commission) for issuing Bitcoin ETFs. India still doesn’t have a Bitcoin ETF yet, but we may see banks offering Bitcoin ETFs pretty soon.

Conclusion

With so many financial institutions worldwide wanting to launch Bitcoin investment-related services, there could be an even large scale institutional adoption of Bitcoin, which will further push its mainstream adoption. It will bring a lot of credibility to Bitcoin and might also amplify its charts. 

P.S: KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing.

India is the second biggest Bitcoin nation in Asia.

We are actively participating in the cryptocurrency market. We are curious to learn about this new age asset class, and more importantly, there is a wholehearted acceptance of Bitcoin in India. Ever since the Supreme Court retracted the ban on cryptocurrencies, the trading volumes of Indian exchanges have multiplied and continue to grow.

So when we are so into this new financial instrument called Bitcoin, let’s dive deep and learn some essential aspects of it.

Top Risks and Rewards of Bitcoin Investing

Every investment is tied to some level of risks and rewards, and Bitcoin is no different. 

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Risks with Bitcoin Investment

Let’s hop in and look at some risks associated with Bitcoin.

1.  Volatile

Cryptocurrencies as an asset class are incredibly volatile, just like stocks, sometimes more. But volatility is also what makes them the most attractive asset.

A highly volatile asset is anything that has the potential to move considerably in value in either direction. When the movement is positive, you seem to make money, but you seem to lose when it is negative.

So as much as it is a risk to invest in a volatile asset like Bitcoin, it can be equally rewarding if not more.

2. Under-regulated Yet 

Bitcoin comes under the broader umbrella of Cryptocurrencies, and, indeed, the market is yet under-regulated.

But you must also factor in that it is built on a revolutionary technology like blockchain. By nature, its functioning and operations are quite technical and tricky, to say the least. This means it is not easy for governments worldwide to define a set framework for their operations.

Nobody has complete control over this technology, and it becomes a challenge for the governments to monitor something they don’t have control over.

So will it forever stay under-regulated? I don’t think so. 

Respective government authorities are exploring ways and means by which they can fully regulate this cutting edge technology and bring in a financial revolution. India, too, is in the process of exploring the adoption of cryptocurrencies in the country.

3. It Is A Software (Sort off & Software can have bugs) 

Bitcoin is essentially a programmed digital currency. It is a set of codes that operate on the internet, and there’s no denying that there is a possibility of bugs in the programme.

However, you must know, Bitcoin is open source and has some of the best developers and miners that help keep it secure. The developers on the Bitcoin network work tirelessly to enhance its functionality. And Miners are responsible for authenticating transactions on the network to maintain transparency.

4. Cyber Theft:

Bitcoin is protected with cryptography; every user has a public and a private key to ensure only an authorised user can access the cryptocurrency. 

However, being a digital asset, Bitcoin is at the risk of getting stolen by hackers. But such instances can be completely avoided if you are diligently taking all the required safety measures like not sharing your OTP’s and Mobile app password with other people, keeping your private keys to yourself and not sharing access to your hardware and software wallets through any means.

Rewards in Bitcoin Investment

Now that we have covered some of the risks involved in Bitcoin let’s also catch up on the rewards that it holds.

1. Asymmetric Returns:

The relationship between the risk and reward in Bitcoin is asymmetric. In simpler words, Bitcoin has the potential to give you a much higher return as compared to the level of risk you take.

For e.g., Over the last three months, Bitcoin has grown nearly 61%; it was valued at close to $30,786 in the first week of Jan 2021 and is now soaring near $52,666. Whereas in the same period it has not experienced a drop of more than 15% at a time

So if you see the risks to return ratio here is quite favourable.

2. No One Can Control It or Seize It:

Have you ever thought about what will happen if the bank you put your money in shuts down one day? All of your money will be seized; you will no longer be able to access them until things are sorted.

Thanks to Bitcoin, it is decentralised, and no one person or authority has control over its operations. This means no one can just come and say that you can’t access your funds.

You are in total control of your money; you can access it anytime, anywhere with a mobile and an internet connection.

3. Superior Store of Value (SOV):

Something can be a good store of value only if it retains and increases in value over time.

For E.g. Real Estate, at the time of purchase, is valued a certain amount and over time not only retains but increases in value. So real estate can be considered a store of value.

Similarly, Bitcoin is also a store of value. Its features like highly profitable (Volatility and Asymmetric Returns) and scarcity have helped it not only retain but exponentially multiply in value. Over the last year alone, Bitcoin grew 800%, so if you haven’t already dipped your toes into Bitcoin, you may want to rethink your decision!

Bottom Line

Over the last year, Bitcoin has turned out to be the most sought after asset from the bouquet of cryptocurrencies. It has had its ups and downs but continues to shine through. 

With so many people being invested in it and a ton looking forward to embracing it, I tried my best to call out the risks and rewards involved in making a choice. Now that the ball is in your court, Happy Investing!

P.S. KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing. 

Ten years back, we had nothing called cryptocurrencies. And then, one fine day back in 2009, somebody with the pseudonym Satoshi Nakamoto released the whitepaper of Bitcoin to a mailing list, and cryptocurrencies came into the picture. 

In the initial few years of its existence, only a couple of crypto enthusiasts were involved in Bitcoin and related activities. Gradually, by 2013 as Bitcoin started to gain traction, various other cryptocurrencies followed through. And now we have over 5000 cryptocurrencies in the crypto market.

Future of Cryptocurrency

From the hundred million crypto investors globally, the world could see more new crypto investors enter the landscape. There is expected to be a rise in the number of crypto investors, both; retail and institutional.

Moving forward, Cryptocurrencies may not be about Bitcoin only; other cryptocurrencies with varied purposes might also pick fire. But not every cryptocurrency will possibly flourish, remember ‘Cryptocurrencies’ is an umbrella term for more than 5000 protocols in the market, and only the best of the best will survive. Hence, while investing, it is important to mindfully analyse and invest.

However, the forecast is based on the current state of the crypto ecosystem in India.

Crypto World | Current State

Cryptocurrencies have been thriving over the last few years, especially in 2020. Over the previous year, the total market size of cryptocurrencies has grown 2X, let alone the double-digit spikes that individual cryptocurrencies like Bitcoin, Ethereum and other cryptocurrencies have experienced.

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It is also one of the years where a new wave of new first time retail crypto investors entered the market. Apart from that, multiple institutional investors have also dipped their toes into the market, including Tesla, PayPal, JP Morgan, MicroStrategy etc.

Additionally, cryptocurrencies are expected to penetrate deeper into the financial landscape, with regulators looking forward to defining a framework for its operations.

Apart from the cryptocurrency market’s valuation boom, multiple technological advancements have also happened over the past. Where earlier Bitcoin was the ultimate cryptocurrency, we are now seeing other cryptocurrencies like Ethereum, Tron, BAT making a significant impact.

In crisp, to accurately foresee what the future holds for cryptocurrencies is a challenge. The ecosystem is very happening, and any event could significantly change your expectations; however, the events look pretty favourable so far. 

Future cryptocurrency to invest in 2021

Knowing how the emotions are swiftly changing and realising that people are becoming more open to other cryptocurrencies. Here are some of the best cryptocurrencies to invest in 2021.

1.Basic Attention Token (BAT)

The Basic Attention Token or BAT powers a blockchain-based digital advertising platform, Brave browser.

 It aims in solving the privacy issues of the prevailing digital advertising industry. There have been concerns around how the existing digital ad companies have been breaching people’s privacy; BAT is working on maintaining user privacy on the internet.

The Brave browser is the first crypto application to have more than one million users.

Greyscale, one of the renowned investment firms, also confirmed their interest in setting up a BAT Trust. Since then, it has been getting a lot of traction.

BAT also announced its roadmap, BAT Roadmap 2.0. They revealed that they are looking to create a decentralised exchange (DEX) aggregator and a Brave Wallet. These additions will extend its reach beyond browsing and expose it to the gigantic world of DeFi.

2.Chainlink (LINK)

Chainlink is an oracle network that feeds real-world inputs to smart contracts, enabling them to execute tasks successfully. LINK has been widely used by some of the leading companies like Google, Aave etc.

They are diversifying into NFT’s and are planning to also enable them to interact with the external world.

Chainlink is also scaling the oracle network by increasing the amount of data the network can transfer. The Chainlink team has developed an Off-Chain Reporting solution that has boosted its scalability capacity by 10X.

LINK has been steadily increasing in value since 2021, with some bumps along the way.

3. Tron (TRX)

The Tron protocol is focused on decentralising the internet; it aims to build a global digital content and entertainment ecosystem. It encourages creators and viewers to participate in creating and sharing content actively.

Similar to Ethereum, Tron is also a smart contract protocol that powers DApps (Decentralised Applications). Apart from that, it also has a super-efficient network speed with the capacity to handle 200 transactions per second. It is one of the fastest-growing public blockchains.

Though Tron hasn’t seen any significant spikes in its value, it has remained pretty sturdy. The objective of the protocol looks promising and is expected to revolutionise the content and entertainment industry.

To wrap it up, I would like to give you a heads up that the above-mentioned cryptocurrencies are just some protocols that excite me, and they may or may not outshine in the future. Hence request you to please make sure you do your research before investing in any crypto.

With that said, Happy Investing!

P.S. KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing. 

Growing up, do you remember thinking you can’t wait to be an adult and doing whatever it is you want in life, imagining living life on your own terms-no rules, no school?

Well, frankly, all I can remember is the disillusionment that slowly sinks in with each passing year. Being an adult is not everything it was cut up to be while growing up. You may not have school or homework anymore, but frankly, tax time can be so much more overwhelming.

Experience will also teach that being an adult isn’t necessarily only about fun and freedom, mainly because it is unsustainable. It sounds boring and simple, but it’s really about doing what needs to be done and doing it on time.

A huge part of enjoying being an adult is about having the time and resources to live life on one’s own terms, which is possible with financial freedom. No matter how much or how little you earn, achieving financial independence is not unattainable. In fact, it can be as simple and straightforward as we want it to be. 

Best Financial Moves Before Turning 30:

Live Frugally (spend less than you earn)

Sounds simplistic, but nothing spells financial ruin like racking up debt faster than one’s ability to earn. Credit cards are a great fix in an emergency, but living life on credit every month is unsustainable. 

The most responsible thing one can do as an adult, or at least one without a trust fund at their disposal, is to live within their means.

Save Regularly (slow and steady wins the race) 

Financial discipline is about living within one’s means and setting aside money for future financial goals. These goals vary among individuals—some may want to save for further education or buy a vehicle or a house, or for wedding expenses or set aside for their folks or their own retirement. 

Goals vary, but what is universal is that not everyone earns well when they start their careers. This is where it becomes essential to set money aside, however little, regularly as soon as one starts earning. 

The younger you are when you start saving, the larger the corpus as the years go. Saving from a young age helps achieve financial goals faster.

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Building an Emergency Fund (no one can predict the future) 

As young adults, we are all guilty of thinking we are ‘bulletproof’. We have our whole lives ahead, and we are energetic and passionate and want to take life by the horns. 

However, as far as clichés go, here’s another for you, life is unpredictable.

Job loss, accident, sudden hospitalisation, unexpected expense that hadn’t been accounted for–none of these situations comes with fair warning. 

However, planning for these can help take off some of the stings when any of these situations arise. Building an emergency fund should be done on priority when one starts earning. This fund should help you cover roughly four to six months’ worth of expenses.

Also, this fund needs to be liquid, i.e. quick to access. It can either be saved in the form of a fixed deposit or set aside in an ultra-short-term debt mutual fund.

Insurance (be prepared)

One of the most common financial planning errors we make as a layperson is meeting our financial goals through insurance products. A majority of us look at insurance schemes as money-making schemes. In doing so, we lose the opportunity to cover ourselves effectively. We fail to choose a financial product most suitable to meet our financial goals effectively.

Insurance products that you should purchase are medical and life insurance. You could buy term life insurance for more effective coverage where the plan cover is at least ten times your annual income. A good thing to remember when purchasing life insurance is that money from the insurance policy benefits your dependents upon your death. It’s not to help you meet any financial goals or save taxes.

Another thumb rule to keep in mind is premiums will be less prohibitive if you were to lock them in at a young age when there are usually lesser health problems to pencil into the premium mathematics.

Public Provident Fund (cause it’s never too early to start planning for retirement) 

Wondering why we skipped other sensible investment avenues, including mutual funds? Well, the reason is the magical concept of compound interest, which is what investing money in a PPF account earns. Not to mention the sovereign guarantee it carries and its tax-deductible status. PPF is essentially a retirement tool. The money you deposit there gets locked up for 15-years with the opportunity to extend the lock-in period in blocks of years.

Financial planning may seem overwhelming on the face of it, but the truth is, the sooner you develop financial discipline, the smoother, more carefree life one can afford going ahead.

Bonus Tip:

The beauty of imbibing financial discipline early in life is that one can afford to take bigger financial risks, which comes with better returns than traditional products and financial instruments. 

Over recent years, interesting financial products such as cryptocurrencies have been gaining popularity. Provided one has a substantial risk appetite, investors can explore them as they have emerged as one of the highest yielding asset classes.

P.S. KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing. 

If you are one of the newcomers to crypto and trying to figure out from where you can buy your first crypto, then you are at the right place. 

Apart from just buying it from somebody, you know who has cryptocurrencies. You can leverage the power of exchanges to connect with buyers and sellers. Cryptocurrency Exchanges are where buyers and sellers get together to perform crypto trades almost instantaneously.

There Are Two Types of Exchanges:

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1. Centralised Exchanges

Centralized cryptocurrency exchanges are third parties involved in monitoring and facilitating the buy-sell transaction between interested parties. These exchanges not only help transact but also allows you to store cryptocurrencies on the exchange.

They require investors interested in making a transaction to submit their personal information, though depending on their respective policies, some exchanges allow investors to remain anonymous.

2. Decentralised Exchanges

There is no third party involved in decentralized cryptocurrency exchanges to facilitate or monitor transaction security. All transactions are peer-to-peer and do not require interested parties to share any personal information.

Difference Between Centralized Vs Decentralized Crypto Exchanges?

Though centralised and decentralized exchanges both are just market places for you to buy or sell cryptocurrencies, their core functionality of centralization and decentralization enables the following differences.

1. Liquidity

Currently, centralized exchanges rank higher on popularity among investors, which invariably affects the liquidity and time taken to fulfil orders. Since there are many buyers and sellers on centralized exchanges, it allows for faster order matching and higher liquidity.

On the other hand, decentralized exchanges have comparatively lower liquidity since they have fewer buyers and sellers on the platform.

2. Charges

Centralized cryptocurrency exchanges may or may not charge a small fee to their customers for services. In contrast, Decentralized exchanges have minimal to zero charges.

3. Security

Decentralized exchanges have higher security than centralized platforms, where the main threat is from hackers. Where wallets that hold one’s cryptocurrencies or the accounts with the exchanges are vulnerable, it is usually advised that given an option by the exchanges, customers may transfer their holdings to private wallets after transactions and take basic online security measures.

Even among centralized exchanges, some have better security measures than others, making the threat of hackers a far less likely event.

Why a Centralized Exchange Might Be Better?

For novice investors, centralized exchanges help manoeuvre the complexity of a cryptocurrency transaction. The involvement of a third party to oversee and facilitate a buy-sell transaction gives the impression of a trustworthy investment environment and lends investors’ confidence when trading in alternative investments such as cryptocurrencies.

Why CoinSwitch Kuber?

Beyond centralized exchanges lie cryptocurrency exchange aggregators such as CoinSwitch Kuber that partner with several exchanges and wallet services so that investors don’t have to go through multiple exchanges looking for the best trading rates.

CoinSwitch Kuber facilitates trades in over 100+ cryptocurrencies with Indian rupees. The advantage of a crypto exchange aggregator like CoinSwitch Kuber is that it pools liquidity from the largest, most popular cryptocurrency exchanges helping investors get the best rates on any trade. 

These trades can be between two cryptocurrencies or a cryptocurrency-INR trade, for example.

We essentially facilitate ease of trading in cryptocurrencies since investors can view rates for a particular cryptocurrency pair from across exchanges while they trade and hold on a single platform. It helps beginners ease into the habit of trading in a complex asset class such as cryptocurrencies.

It could sometimes be overwhelming for beginners to invest in an asset class like cryptocurrencies that have gained wide attention in a brief span. Hence we equip you with features on the platform like the price chart, limit order etc. The liquidity on the platform also helps facilitate faster trades, thereby lowering the volatility or fluctuations around market rates.

Bottom Line

The benefit of having a third party involvement in facilitating transactions on platforms like CoinSwitch means investors can have access to a dedicated support team to help them in the process.

Investors at the beginning of their investment journey typically lack the confidence to explore a concept like cryptocurrencies. This could be for several reasons, including that the concept is a relatively new one compared to some other traditional financial investment avenues. We usually tend to fear that which we do not know of.

Thus we help investors ease into the environment of cryptocurrency trading by providing you with a sense of security, ease of trading from a single feature-rich platform, and reaping the benefits of higher liquidity, including faster transactions at attractive rates.

KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing.

Remember, in the old days; we had a pack of Pokémon cards? If you have come across it, you would know that each of those cards in the collection was unique and non-replaceable. NFTs or non-fungible tokens are on the same line. 

You can replace a TV unit with another one. You can even trade a BTC for another. Contrary, the term “non-fungible” refers to something unique and that you cannot replace. These are a part of the Ethereum blockchain (a blockchain exclusive to NFTs) and some other supported blockchains. 

The gist is that NFTs can refer to anything uniquely available digitally (there have been attempts to attach NFTs with real-life objects). But the current traction is more towards digital art and other such rarities.   

It is imperative for people Googling words like NFT token list or NFT token price to understand NFT refers to non-fungible ‘token’ token or non-fungible ‘token’ token price. It is incorrect, and instead, search for “NFT” or “NFT price.” Also, if you are searching for NFT crypto, it is not a cryptocurrency.

A 2021 Guide to Non-Fungible Tokens (NFTs)

Blockchain has a unique knack for being in the headlines. Every time there is something that breaks out, people across the world go, “Wow! What’s next?”

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We are all used to investing in mutual funds or ELSS, which entails part ownership of a company’s stock. It has become so common that a new fund comes up every other day, and hardly anyone bats an eyelid.

But we suggest you take a step back to read what’s coming next. 

Twitter founder Jack Dorsey sold his very first tweet as an NFT via a platform called Valuables. 

Stunned? There is more to come. 

The furious bidding ended at a user acquiring it at roughly $2.9 million. 

We understand you are already scratching your head. But this is one of the minutest possibilities made possible by NFTs or non-fungible tokens. And that is what this guide is all about. 

Characteristics

Here are the attributes of NFTs – 

  • Each NFT is unique and cannot be replicated by any other NFT. They contain a highly secure information tab for defining their qualities.
  • Each item in the NFT list represents a unique element that you cannot further divide into smaller units. It brings clarity to the purpose of such tokens.
  • Creators can modify the characteristics of each such token.
  • These demand higher value because of their uniqueness.

Importance of NFT

Here is why NFTs are the real deal – 

1. The inculcation of blockchain adds a much-needed layer of security

We have seen the digital representation of physical assets before. So what is NFT doing differently? It adds a layer of blockchain that ups the security aspect and helps curate intelligent contracts. These also offer higher safety and can be the potential future of transactions.

2. They help in identity management

Nike has already started using NFT for identity management. They have a patent for a method of verifying their sneakers’ authenticity via CryptoKicks, an NFT-based system. The idea, if it seeps down to a more generic usage, such as human ID verification, can improve entry and exit processes. It can also make tagging easier and manage it all seamlessly.

3. They redefine the meaning of the term ‘investment.’

The offline world has a very narrow meaning of the word ‘investment’. Imagine the real estate that you see in front of you as a digital one, and the equations become very different. You can now fractionalize it, distribute each segment as a token. The possibilities are endless.

It often gets difficult for individuals to own artworks and other invaluable items. Instead, if we create a digital equivalent of the asset, there is no need for a single owner to own the entire piece. We can instead assign parts of it to multiple owners.

4. Possibility of democratising physical assets

A middle-class individual in India can aspire to own a piece of land near a beach in the USA, but he knows it can be difficult to achieve in reality. The inculcation of non-fungible tokens opens a world of possibilities for people who limit their dreams because of a lack of resources.

With NFT’s help, owners can divide their real estate or other assets into tokens. Each such division has a unique set of characteristics and an NFT to represent them. It can help generate higher returns and also democratise physical assets for people across classes and means. 

5. They streamline the investing process

Selling a physical asset like land or building often involves agents and a flurry of complex processes. What NFTs do so well is transfer the entire process online. It removes the need for intermediaries and lets you meet your buyers directly without any barriers. It makes the process holistic and does away with any potential communication gap that usually creeps when multiple parties are involved.  

Popular examples of NFT

Even though the possibilities are endless, here are some probable use cases of NFTs – 

1. Gaming industry

A game called CryptoKitties allowed the users to trade virtual kittens among themselves in NFT form. These can become very popular in games, enabling the exchange of accessories and rare features. 

2. Collectibles

We are not sure how collectible Jack Dorsey’s first tweet is, but there are undoubtedly other highly collectible assets that can benefit from the inculcation of NFTs.

3. Digital assets

Don’t be surprised if you come across people selling virtual land and other assets in the upcoming future.

4. Identity tagging

Spoofing and other illegal activities have been a major headache for governments across the world. With NFT’s adoption, you can soon safeguard critical assets from frauds and seamless verification. 

2021 can well be the year of the NFTs

The first quarter of 2021 saw massive adoption and NFT becoming a hot topic. We are yet to see the use cases in tandem and cannot wait for NFTs to unearth alternative possibilities. That being said, it is imperative for us to be cautious before adopting it in a full-fledged manner.

KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing.

Crypto tokens are digital assets that offer functionality over and above what a cryptocurrency does. 

The best analogy to understand the difference is currency vs shares. Both of these have intrinsic value, but the token is valued in terms of the cryptocurrency. 

So, a crypto token on Ethereum will be valued in terms of the Ether cryptocurrency. You can, of course, extrapolate this value into regular currency such as INR. Ethereum has by far become the most popular blockchain for crypto tokens. It uses its own Ether cryptocurrency on it.

These tokens are typically issued via initial coin offerings (ICOs) by companies to fund projects. The difference is, instead of raising US dollars, or Indian Rupees, or Euros, they raise funding via the native token of the blockchain they exist on, like Ether or Bitcoin or NEO. 

Investors are given tokens that they can redeem for a product or service or something else of value. Unlike shares in a company that provides an ownership stake in the company, crypto tokens do not offer ownership. At no point is the investor part-owner in the company.

How is it different from Cryptocurrency?

A cryptocurrency is a digital asset (coin) that runs on its own blockchain. For instance, Bitcoin is on the Bitcoin blockchain. 

I will define it in another way: 

A cryptocurrency is a native token – a token native to its own blockchain.

Bitcoin was the cryptocurrency pioneer. Then came a whole bunch of other such coins, such as Ether (on the Ethereum blockchain), NEO on the NEO blockchain, Litecoin, Cardano, Ripple, Stellar, Tron, Chainlink, Tether, Dash, Monero, and so on. All these cryptocurrencies other than Bitcoin are grouped into a description – altcoin.

All these coins act as money. However, there are no physical coins. These coins exist as verified data on the blockchain. Every time you send these coins, the blockchain keeps track of them, with the many computers (called nodes) recording, checking, and verifying these transactions.

Although cryptocurrency is still in its infancy, many companies and service providers are accepting them for payment. You can transfer money, or you use them as a store of value (Bitcoin has increased in value from $1 in April 2011 to $59,386 at present). 

Unlike cryptocurrencies, which are native tokens, crypto tokens are non-native tokens. They do not have their own native blockchains, instead of using existing blockchains and their respective cryptocurrencies as an exchange medium.

Types of Crypto Tokens

There are various types of such tokens based on what they offer, such as:

  • Security or asset tokens
  • Payment tokens
  • Equity tokens
  • Utility tokens 

For instance, ICO tokens are security tokens since these tokens expect profit based on the assumption that the company issuing the token will do well, increasing the token’s value.

Payment tokens are used to pay for services and goods. Equity tokens represent stock in a company, although very few companies do this because the regulations are not clear around this practice. 

Utility tokens are used to access a product or service, such as power or subscriptions. These are amorphous classifications, and some tokens might fall into more than one of these subsets. When the market for these tokens become larger and more established, regulators will probably come up with more specific classifications.

Difference Between Altcoin and Crypto Tokens

As explained previously, all cryptocurrencies are native tokens, while crypto tokens are non-native tokens. Native tokens have an intrinsic value – they are used as payment on the blockchain. It takes time and effort to create the native token by mining them. To learn more about crypto mining,  here is a great tutorial.

On the other hand, the crypto token is more speculative. Though their value based on their native token, it can fluctuate depending on the token offers. No intrinsic value is associated with the token. If its demand is high, it goes up, if not down.

Best Crypto Tokens to Invest in 2021

Here are some of the most popular crypto tokens to invest in 2021

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     1. Uniswap

Uniswap is a DeFi (Decentralized Finance) protocol essentially used to exchange cryptocurrencies. It facilitates transactions between various crypto tokens through the use of smart contracts on the Ethereum blockchain. It is currently priced ~₹2,750 and ranks #8 in terms of market capitalization.  

     2. Tether

Tether is a crypto token issued by the company Tether Ltd. It is a type of stablecoin that helps anchor the value of cryptocurrencies to the price of national currencies. It is generally used by people who want to avoid extreme volatility in the crypto market. Tether is currently priced at ~₹80 and ranks #5 in terms of market capitalization.

    3. Chainlink

It is an ethereum token that aids the running of Chainlink decentralized oracle platforms. It can be defined as a secure blockchain middleware as it intends to link smart contracts across blockchains. It is currently priced at ~₹3,000 and ranks #10 in terms of market capitalization.

FAQs on Crypto Tokens:

1.How to buy Crypto tokens?

You can buy crypto token by participating in their ICO’s. First, you have to register yourself for a genuine ICO and then transfer Bitcoin or Ethereum to the wallet address shared by them and get ICO tokens in exchange.

2. Which are the best Crypto Tokens?

Here are some of the most renowned crypto tokens:

  • Tether
  • Uniswap
  • Chainlink

3. What is the difference between a Crypto token and Crypto Coin?

The biggest difference between a crypto token and a crypto coin is that a cryptocurrency runs on its own blockchain while a crypto token operates on an existing blockchain.

4. Is Bitcoin a token or a coin?

Bitcoin is a cryptocurrency coin as it is the native token of the Bitcoin blockchain.

KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing.

The growing popularity of cryptocurrencies has thrust a new set of jargons onto investors. Tokens, blockchain, smart contracts, decentralised apps etc., are becoming a part of our everyday vocabulary on cryptocurrencies or specific platforms. 

I know that these terms may sound like complex jargons, but the truth is that they are actually simple concepts to understand. 

The blockchain technology underpinning the first original cryptocurrency ‘Bitcoin’ has evolved two more generations since its inception. 

Ethereum, the second generation blockchain used to create smart contracts, is bringing forth strategic evolutions across multiple industries, including finance, insurance, healthcare and more.

But what are smart contracts, and how do they work?

Let us find out.

What are Smart Contracts?

Smart contracts are self-executing programs stored on a blockchain that run when pre-defined terms and conditions are met. 

In other words:

They are a set of computer codes that run on blockchain technology. And constitute a set of pre-defined rules which are agreed upon by the involved parties. 

Smart Contracts help verify, enforce, and execute digital transactions without third parties’ involvement once these predefined rules are met. 

Simply put:

Smart contracts are designed to eliminate the need for middlemen such as a lawyer or a bank representative for getting a job done. The terms of agreement and contracts are written directly into lines of code. Upon fulfilment of the conditions laid out, the smart contracts self-execute the transaction. 

The corresponding agreements and code are stored on a decentralised and distributed blockchain network. This means the transactions can be easily tracked in real-time by the involved parties and are irreversible. 

Thus, you don’t need a central party to intervene in the agreement, and the system remains conflict-free and transparent.

Smart Contracts for cryptocurrency and digital tokens make the transfer between the buyer and the seller possible once the transfer conditions are met.

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How Do Smart Contracts Work?

Let’s look at an example to understand how these contracts work.

Suppose you are selling a house property. This is a cumbersome and time-consuming process involving a lot of paperwork. Not to forget the constant back and forth over calls to communicate any developments. 

Plus, if you hire a real estate agent, it brings in a possibility of risk, frauds or scams as they are responsible for overseeing your deal. Taking into account that they charge you commission and involve an escrow service to ensure the transfer of funds from one party to another. These cuts can add up to a lot of extra loss of money for you as a seller.

Now, imagine a world where you could sell your property without a real-estate agent and an escrow service agency. Enter Smart Contracts.

Smart contracts work on a simple condition-based principle, “if/when….then” lined into codes on a blockchain.

Referring to the example cited above, you could establish a smart contract with pre-defined rules like this:

“if/when Mr A pays the agreed property amount, then I can transfer the property in his name.” Or, “if/when I transfer the property in Mr A’s name, then he will pay the agreed property amount.”

You can include as many terms and conditions as you want in a smart contract. And can code all the functions of a real estate agent into a smart contract. Once all the requirements are met, the smart contract executes and validates your digital 

transaction.

Types of Smart Contracts

There are many types of smart contracts, including:

Smart legal contracts

These are the most common types of contracts. Most contracts are enforceable by law. Without delving into the technicalities, smart legal contracts involve strict legal consequences if the parties involved fail to fulfil their contractual obligations. 

Decentralized Autonomous Organizations (DAO’s)

DAO’s are generally communities that exist on the blockchain. These communities may be defined by a set of rules made up and put into code by multitudes of smart contracts. 

Application logic contracts (ALCs)

These contracts are built upon application-specific code designed to work together with other programs and smart contracts on the blockchain. 

Since this concept is currently dynamic, all the definitions may be fluidic and vague at best. 

Key Benefits of Smart Contracts

Listed below are the top advantages of smart contracts:

  • Speed

Smart contracts eliminate the need to manually process every document as it is a distributed network that works online. This can speed up the execution process.

  • Transparency

Before the smart contract is coded, all the agreement rules are doubly checked by the involved parties. This ensures transparency.

  • Accuracy

When you switch to smart contracts, there are no more manual form fillings. A self-executing smart contract is coded in an exceptionally detailed form which ensures better accuracy.

  • Savings

As the middlemen and third parties get eliminated from a smart contract. You can significantly save on transactional and operational costs.

  • Secure

You don’t have to worry about any hacks or breaches for smart contracts. They are built using supreme data encryption technology, offering the highest security levels.

  • Paperless

Since smart contracts are computer coded documents, there is no documentation involved in the process. This not only saves time but also contributes to the ‘go green’ initiative.

  • Data Storage

Smart contracts come with easy storage and backup options that cover you in the rare event of a data loss. Your data stays secure at all times, and you can access it any time of the day. Even if you lose it by accident, you can restore it quickly.

  • Trust

As we learned, smart contracts don’t involve any third parties. Since its transactions are highly encrypted and shared across on a decentralised platform, it helps build trust. There is no need to question whether any involved party has altered information for personal benefit as smart contracts are irreversible.

  • Time-efficient

Smart contracts are run through pieces of software code, ensuring the transactions get completed fast. There are no human delays caused by intermediaries or mediators, making them time-efficient. 

Wrapping Up

The future of the contracts world is headed towards smart contracts. They can bring revolutionary changes to the way business is currently being done using traditional systems. 

It is for this reason and more that use cases for smart contracts have been evolving globally. By the end of 2023, the global smart contracts market is expected to reach approximately US $300 million with an annual growth rate of up to 32%. 

Suppose you wish to keep pace with the technological advancements and make your business more seamless. In that case, a smart contract offers a fitting solution. 

KuberVerse is an educational initiative. Anything expressed here directly or indirectly is not investment advice. And we ask you to do your own research before investing.