Photo by Shubham Dhage on Unsplash
Cryptocurrencies, which once faced a lot of skepticism, have become an important aspect of the modern global economy. That’s because as blockchain technology has advanced, these digital assets have spawned an ecosystem with various cryptocurrencies and side products that have multiple uses.
These range from decentralized finance (DeFi) platforms to gaming applications and secure contracts, that have made cryptocurrencies more than just virtual money. This is why we’ll be taking a look at some of the biggest cryptocurrencies along with their side products below.
Ether and Ethereum Dice
First, we have Ether (ETH) which is the native cryptocurrency of the Ethereum blockchain, the second-biggest blockchain after Bitcoin by market capitalization. It was designed to do much more than facilitate transactions. That’s because it was built onto a programmable blockchain, that allows developers to create their own decentralized applications (dApps) on it.
Allowing developers to create their own dApps on this blockchain has resulted in a notable side product, which is decentralized gambling platforms, with games like Ethereum dice growing popular. What has made them attractive to players is that Ethereum’s blockchain allows for payouts in less than five minutes and hosts large game libraries with different variants of dice games.
Bitcoin and Lightning Network
Next up, there’s Bitcoin (BTC), which still dominates the cryptocurrency market as it’s the original and most recognized virtual coin. However, even though it has served as an excellent medium of exchange and store of value, it has been plagued with scalability issues that often result in slow transaction times and high fees when many people are using it simultaneously.
Luckily, Bitcoin has seen a side product emerge to address this issue, which is called the Lightning Network. This product is asecond-layer solution that makes transactions faster and cheaper by letting users create payment channels that don’t rely on the main blockchain to avoid congestion.
Binance Coin and Binance Smart Chain
There’s also Binance Coin (BNB), which is the native token of the Binance ecosystem that is now more than just a discount token to lower trading fees on the Binance exchange. That’s because this year, BNB has managed to get into the DeFi space with the launch of Binance Smart Chain (BSC), which is a blockchain that runs alongside Binance’s primary chain.
BSC’s launch has enabled many developers to create their owndApps, whilst also serving as a cheaper alternative to Ethereum. This is why BNB is now used on various Binance side products like yield farming platforms, decentralized exchanges (DEXs), and liquidity pools.
Solana and Solana NFTs
Solana (SOL) has attracted a lot of attention in the crypto scene by being one of the fastest blockchains in the world that can handle large volumes of transactions whilst keeping transaction costs low. However, Solana’s blockchain is also famous for being a dApp hub.
The most prominent side product Solana has produced by allowing dApps is its thriving NFT ecosystem. Since Solana is cheaper and faster to transact with than many cryptocurrencies, it has drawn many creators and artists who want to mint NFTs without having to pay high gas fees.
Cardano and Project Catalyst
We also have Cardano (ADA), which operates on a blockchain that’s focused on security, sustainability, and scalability. This coin’s transactions are processed with a proof-of-stake consensus mechanism that is more energy-efficient than traditional proof-of-work models, which is why it’s popular among environmentally conscious developers and investors.
One of the most significant side products Cardano has is Project Catalyst, which is a decentralized funding initiative. Project Catalyst is boosting innovation in projects on the Cardano blockchain by letting ADA holders propose new ideas and vote on them instead of just offering funds.
Polkadot and Parachains
Lastly, there’s Polkadot (DOT), which is a unique cryptocurrency. It’s on a blockchain that focuses on increasing interoperability instead of focusing on promoting its own. This is why the project behind this coin and chain has been able to find a way to allow different blockchains to securely share data and communicate.
Polkadot has done this by having a multi-chain architecture that allows other blockchains, which are called parachains, to operate on their own but still connect to the main chain. These parachains have been the biggest side products Polkadot has produced.
These parachains are usually optimized for specific use cases, like DeFi, gaming, or privacy. To get a parachain, developers have to bid for slots that Polkadot auctions. This approach is what has played a big role in boosting the ecosystem’s growth, as it has allowed developers to create blockchains for whatever they want.
In conclusion, we hope that you’ve seen how the crypto scene has grown exponentially since its inception in 2009. Also, we hope you now have a better understanding of what has transformed cryptocurrencies into more than just tools to exchange or store value.
As we’ve seen, these coins and their blockchains are now platforms for innovation by providing the infrastructure to facilitate decentralized finance, gaming, digital art, and countless other applications. With cryptocurrencies continuing to evolve, we can also expect their side products to reshape more industries and economies in the future.
