What is Tezos (XTZ), and is it worth buying?
The environmentally friendly cryptocurrency Tezos (XTZ) made considerable gains in August w i th three Swiss companies Crypto Finance AG, In Core Bank and Inacta, all planning to use the platform.The trio joined forces to create regulated financial products, with smart contracts to support anti-money laundering and governance compliance activities, as well as supporting new digital financial products in the form of tokenized assets for institutional clients.In addition, Tezos has completed a key network upgrade, so taken together its not surprising its token price has risen by nearly 95% since early August.
Overview of Tezos
Tezos is a blockchain protocol with smart contract functionality, which describes itself as a “smart currency” as it first defines itself as a currency.Founders Arthur and Kathleen Breitman first launched Tezos in 2014.
Arthur has previously worked in the field of self-driving cars, and as an analyst at Goldman Sachs and Morgan Stanley,while Kathleen Breitman has worked at Accenture, Bridgewater Association and The Wall Street Journal.According to CoinMarketCap, as of August 30, 2021, the market value of Tezos is $4.8 billion.
What makes Tezos stand out from the crowd?
One thing that makes Tezos stand out is its governance system.The network calls itself a self-modifying blockchain because it aims to develop and update itself.The “bakers” of Tezos can propose changes to the system.
Bakers are people who own a large number of Tezos.They can participate in the network by adding new blocks to the blockchain, with their proposals voted on.The idea behind this system is to avoid a hard fork of the Tezos blockchain because these stakeholders are involved in the design and running of Tezos.For comparison take the example of Bitcoin Cash (BCH) which is a hard fork of Bitcoin (BTC).
Bitcoin Cash can process transactions more quickly than the Bitcoin network, meaning that wait times are shorter and processing fees tend to be less.This shows that hard forks are not necessarily a bad thing, but they may cause security vulnerabilities.
Tezos uses a more environmentally friendly proof-of-stake model than Bitcoin’s Proof of Work to produce new blocks and maintain network security.Its smart contract language called ‘Michelson’ is built for security avoiding the loss or freezing of funds due to errors in the code for example.Although many Tezos applications are designed to be used in finance, Tezos has also seen demand for NFT and gaming projects.
Is Tezos worth buying?
If you are considering buying Tezos, which is available on the BigONE exchange, ask yourself a few questions first.
Is Tezos’s leadership up to the job?
Tezos was in trouble shortly after the initial token issuance in 2017, with internal disputes delaying the launch of the platform and the issuance of tokens.
With the advent of lawsuits, the predicament has intensified.Finally, in 2020, Tezos reached a settlement agreement of $25 million, of which $16.5 million will go to investors that made losses.For Tezos, it is ironic that a token designed for self-management could not be delivered due to governance issues.
Deciding your level of loss before starting to invest
Cryptocurrencies may generate high returns, but they are also risky and volatile investments.Before you invest in any cryptocurrency, please make sure that your emergency fund is sufficient to cover any losses.
Ideally, cryptocurrency should account for a part of your overall investment, and this part of the investment amount is within the range of your acceptable losses.Which means that if the cryptocurrency causes losses due to market fluctuations, you don’t have to worry about it affecting your life.
Do you understand the cryptocurrency market?
Ethereum is the first cryptocurrency with smart contract functions and therefore still occupies a large market share.The dramatic increase in transaction volume means that it must deal with network congestion and resultant high fees until it can successfully upgrade to version 2.0.But it’s not just about technical prowess, to be a successful cryptocurrency currency, a combination of technical strength plus communication and marketing acumen is needed.
As outlined in a recent Cointelegraph article from Jordan Finneseth: “The Ethereum ( ETH ) network is currently the dominant layer-one protocol in terms of smart contract deployment and active users, but the race to become the ‘world’s computer’ is far from settled..one project that has been on the rise over the past month is Tezos, a proof-of-stake blockchain network that is designed to evolve over time without the needing to undergo a hard fork.”
In this light Tezos can be regarded as a highly regarded project; it seems to have overcome the initial difficulties; its governance model and native smart contract language are likely to help it achieve long-term success.This success has resulted in it attracting more projects to join its platform.“Three reasons for the strong growth seen in XTZ over the past month include improvements made to the network through the recent ‘Granada’ upgrade, the adoption of the Tezos network by several large banking institutions and attractive staking rewards that entice token holders to stake their coins on the network,” Finneseth concluded.For investment purposes BigONE recommends that you compare it with other programmable blockchains such as Cardano before buying XTZ.
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