Blockchain has come a long way since its inception, which had a humble beginning as a distributed Ledger with Bitcoin’s PoW protocol. However, since the growing popularity of Bitcoin, people understand its immense potential.
On the other hand, the introduction of smart contracts since Ethereum’s Blockchain has completely transformed the industry. Now people can use a distributed ledger and transfer value, where smart contracts have a fundamental role. However, in the beginning, it took many years for people to start identifying use cases in various industries.
Nowadays, Blockchain still faces issues regarding scalability, where some sectors have made improvements. Therefore, in this article, you’ll discover the first part of the Top 10 use cases of Blockchain.
Finance is one of the first sectors which is impacted by Blockchain. Therefore, it was the first sector that developed important use cases successfully. First, it started with introducing payments using cryptocurrencies (remember the famous/ infamous Bitcoin Pizza story?).
People started building smart contracts during IDOs, where if you pay by cryptocurrency, you will automatically have project tokens. We have come a long way since then.
Payments are one of the most related use cases of blockchain technology, where Bitcoin and other altcoins started getting accepted as a payment method.
For example, Bitcoin Maps is a good platform that shows which stores accept Bitcoin in your neighborhood. Also, other notable stores that accept cryptocurrency payments include Overstock, register, Expedia, cheapair, etc.
On the other hand, other popular cryptos are used for payments like DAI, USDT, ETH, etc.
Moreover, crypto debit cards are a good option for you to start with. You can load crypto in the app, which syncs it with a debit card, and the platform automatically converts your crypto to Fiat currency. Some notable crypto debit cards include Crypto.com, Wirex, Binance Card, etc. Watch our full video here:
3. Decentralized Exchanges
Initially, cryptocurrencies were traded in centralized exchanges only. These exchanges followed an order book where sales happen only if a buyer is willing to buy and vice versa.
However, the invention of Automated Market Makers (AMMs) ensured that the entire market making is implemented by the community and a group of smart contracts that manage trades in a decentralized way. This eliminates third parties for exchange and will have a deep impact on Banks, too, in the long run. Also, liquidity is not dependant on a central party.
The most important decentralized exchanges include Uniswap, Sushiswap, PancakeSwap, etc.
Source: SushiSwap Protocol
4. Lending and Borrowing
Nowadays, obtaining loans from banks is very complicated, full of requirements related to credit scores, reviews, delays, paperwork, high-interest rates. Still, your loan is at the mercy of the Bank.
However, getting a loan in crypto is simple. First, you need to hold a crypto asset by depositing it into a liquidity pool of a DeFi platform, which will give you a yearly interest. Also, you can get a steady yield by just depositing these assets in a crypto lending platform like AAVE, Compound, among others.
Source: AAVE Protocol
Note: You need to be extra careful while locking your assets. There have been occasions of rug pulls and people losing their money. We would recommend you to stick with reputed platforms only.
5. Synthetic Assets
Synthetic Assets are, in a few words, the tokenization of real-world assets in the Blockchain, where the price of a synthetic asset is pegged to a real-world counterpart—for example, Tesla’s Share, Oil, Gold, etc.
As a result, this allows investors to leverage the benefits of the Blockchain with 24-hour trading, instant buy and sell features that make them participate in real-world asset ownership.
Some notable projects that deal with synthetic assets include Synthetix, Mirror Protocol, etc.
Source: Synthetix Protocol
In Part 2 of this article, we will talk about Digital Ownerships and how NFTs are changing the philosophy of digital ownership in multiple sectors.
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