If you’re an avid Luno blog reader, you’re familiar with our stance on adding new cryptocurrencies to our platform. If you’re joining us now - buckle up and welcome aboard our rocket ship.
Behind our thinking
We know it can be frustrating if we don’t support your favourite altcoin, but we have good reasons as to why we don’t. Before adding any cryptocurrencies, we like to ask ourselves a few important questions, like:
- Does it solve a clear and unique use case? Does a working solution already exist?
- Does it have a large community of people who will be willing to adopt this solution?
- Is it decentralised? Is it controlled by a single organisation or person?
- What does the team look like? Do they have experience?
What problem are we solving?
According to CoinMarketCap, there are over 2,000 altcoins available on the internet. We want to ensure we're only providing those that perform a specific and obvious function to the majority of our customers.
Another aspect we consider important when determining which cryptocurrencies we list is mass adoption. Like other new technologies, unless it can help save a lot of time and money, or has some other tangible form of utility, people are unlikely to go to the effort of adopting it. Having a unique use case and reaching mass adoption go hand-in-hand. For a new cryptocurrency to gain widespread adoption and market traction, it needs to have a clear and unique use case which solves a problem for a large number of people.
A practical example: telephones. Landlines reached mass adoption because everyone needs to communicate with each other, and they were far more efficient than older methods like sending physical mail.
Bitcoin: Paving the way for a better financial system
Of all of the cryptocurrencies out there, we believe Bitcoin has the network effect and many snowballing benefits that continue to encourage people to adopt it into their daily lives. Plus its tenure within the crypto space has afforded Bitcoin the status of household name. Bitcoin offers a better solution to the unmalleable banking systems that were created decades ago at a time when people’s needs and desires were totally different from today’s.
Ethereum: Making contracts smarter
When we look at the case of Ethereum, it’s a great example of a cryptocurrency with tons of valuable and unique use cases. When we consider the way we interact within the contractual space (think: renting property, signing up with a mobile service provider, or even admitting yourself into a hospital), the paperwork generally exists in some type of database. Who controls the database? How safely are these important documents kept? Most of the time, you don’t know the answers to these questions, but the truth is, that’s your important personal information that only authorised personnel should be able to access for a specific reason. With the awareness and news surrounding data leaks becoming more and more prevalent (and rampant), people are becoming more concerned with protecting their data, which is where one of Ethereum’s great unique use cases comes in: smart contracts.
If it ain’t broke, why fix it?
The amount of innovation happening in the world right now is inspiring, but the viability of all of these innovative ideas and prototypes is tested when considering whether or not they’ll solve a problem for the larger public. More often than not, to innovate costs money, and if the innovative product isn’t going to sell (and, in turn, make a lot of money), there’s little chance it’ll survive.
The financial system is most certainly not broken (it’s not all doom and gloom, folks), but we believe it's due for an upgrade. We believe the two cryptocurrencies we offer have the potential to (and do) save people time, money, and a whole lot of hassle. Even though there are loads of cryptocurrencies out there with great unique use cases, we also need to ask ourselves if the world is ready for them yet.
Share a great use case
We understand the passion behind a popular altcoin, however, our vision of upgrading the world to a better financial system needs to be at the forefront of each and every cryptocurrency we consider.
We always encourage you to do your own research before you consider buying any altcoin, and ensure you’re aware of scams and fraudulent ICOs. Let us know on Facebook and Twitter which cryptocurrencies you believe have the best unique use cases.