Decentralized Exchanges
A decentralized exchange is a fundamentally different way of interacting with capital markets when it is compared to centralized systems, such as stock exchange apps like Robinhood or crypto exchange applications like Crypto.com. In contrast, running a decentralized exchange does not necessarily require a company registration, or using a decentralized exchange does not necessarily require users to share their personal information.
Unlike a centralized service, decentralized exchanges do not require funds to be in their custody. The user holds all of their funds, even during their trade/exchange process execution. This eliminates the counterparty risk meaning decentralized exchanges cannot default the funds they hold as a centralized entity, like banks or centralized exchange companies. This value proposition is brand new and fundamentally different from traditional financial services.
Another benefit of using a decentralized exchange is that they are open-source, they are programmable, and composable. This opens up an opportunity for both developers and investors, meaning, any talented set of individuals can launch a project on a decentralized exchange by interacting with their smart contracts without permission. Unlike monopolized centralized services where the institutions hold the power and decide which projects are going to fly including the parameter that is how much fee is required for listing. Also, there are a lot of opportunities that can be found on decentralized exchanges because early-stage gem projects are being developed and launched on DEXes before they gather some clout to hit on known centralized exchanges. When a project gets to that level, the widespread usage of centralized exchanges may provide intense capital exposure thus benefitting the early investors.
Example Project in Cronos [PROMOTED]
Meme Tokens
The meme coins started as memorable jokes as there was no intention behind them to be worth their current value as of 2022. Dogecoin, as a pioneer, did not have a complex structure as reflections that newly developed meme tokens are adopting. The subject introduced as reflections is a complex subject that exposes investors to a whole new type of game theoretical structure. The incentive mechanism for the sellers, buyers, and holders is experimental. But there are already a lot of successful projects that reach decent market caps.
Example Project in Cronos [PROMOTED]
Governance/DAO Tokens
Governance in crypto is a very hot topic and community members of various projects are constantly coming up with new ways of governing a network of people who share a similar vision, and investing in shared ideas. When the governance of a project is being run by the community members who use their network tokens as a means to vote for proposals that are also submitted by other community members can be categorized as DAO, Decentralized Autonomous Organization.
The decentralized autonomouıs organization model is an emerging structure in crypto, which offers a new model of a corporation that is nothing like a traditional one. Dominantly, it is being used in Decentralized Finance which offers financial services such as offering lending & borrowing, yield Farming, issuance of stable coins, and liquidity pools. There are already a lot of working examples of DAOs that offer financial services and there are also a lot of experimental DAOs that try different things which signal to the crypto ecosystem that the surface is barely scratched.
Example Project in Cronos [PROMOTED]
Gaming Tokens
Gaming tokens, sometimes called metaverse tokens, are the in-game currency of blockchain-based play-to-earn games. They act as the unit of exchange, they are being used as expenditure for upgrading weapons or armors. In other words, a gaming token in a game is the measure of the resources the player possesses along with the ability to trade them in global crypto markets.
Example Project in Cronos [PROMOTED]
NFTs and Collectibles
Non-Fungible Token(NFT) is a different standard than traditional cryptocurrencies whereas Bitcoin, Ethereum, and CRO are fungible, however, NFTs are not. Fungibility means tokens or coins are exchangeable with others of the same kind that equate to the same amount of value. We can also exemplify this with dollars: A 100 dollar bill is exchangeable with 5 of 20 dollar bills. There is absolutely no difference between a 100 dollar bill and 5 of 20 dollar bills, making them fungible. When it comes to Non-Fungibility, each piece of the token or the object is one of its kind which does not equate to any other thing that exists in the universe. A home, an original painting from Leonardo Da Vinci, or any digital object that is minted as one of its kind can be examples.
When these NFTs come into the collection, like profile picture projects that revolve around its community members, each piece of the collection is one of its kind with slight differences from others in accessories, eye shapes, skin color, clothing, and others.
Example Project in Cronos [PROMOTED]
NFT Marketplaces
Having an efficient platform for NFTs to be displayed, traded, and auctioned is paramount for its economy to stay vibrant. It is also a good place for people to browse the projects & their art so they can be exposed to the bleeding edge of the digital art transformation. NFT marketplaces pose as a museum, commercial gallery, and an intersection for exposure to the internet culture.
Example Project in Cronos [PROMOTED]
Launchpads
Launchpads are intermediary platforms for those who want to invest in projects at their early stages. A launchpad acts as an authority that vets the projects to be displayed or promoted on their platform. Community members who are already aware of the launchpad have an easy reach to the information that is collected and cured on the platform. The integrity and reputation of the launchpad can also signal the trustworthiness of projects for investors which builds an additional layer of conviction in their decision-making.
Example Project in Cronos [PROMOTED]
Lending & Borrowing (DeFi)
Lending and Borrowing is one of the killer apps of DeFi. Any person that has an internet connection can instantly borrow from many decentralized services in a peer-to-peer fashion, without any paperwork or even basic identification. Although uncollateralized credit line hasn’t been efficiently developed and widely adopted, collateralized borrowing is widespread and mainstream.
Borrowing money in crypto hasn’t become the absolute killer app yet, due to the lack of uncollateralized credit line applications, but the service of lending money has. There are crazy interest rates, even for stable coins(exchangeable 1:1 with USD) in crypto that people can make 8%-15% interest annual per year on Decentralized Finance relatively safely. Where, currently, the federal government of the US is offering 0.25% interest annual per year. It is mind-blowing to even compare the two.
There is still some due diligence needed to be done. A couple of research topics would be: which Decentralized Application is to be chosen, what is the smart contract risk, and what stable coins exactly entail.