List of All Smart Contract Coins
April 2024

What is Blockchain?

Blockchain is a system of data recording. Data and information are written on different blocks and each information on different blocks must match and validate the data. Each block is controlled by a different user or server. Thanks to the Blockchain system, we can store data in an environment that no individual can change, hack or damage stored data.

What are smart contracts?

Smart contracts are like a real-world contract that defines the terms of an agreement. The difference between smart contracts is that they exist as a coded program on blockchains. Once code is written and the program is established on a blockchain, it can not be changed, forged, or hacked. Smart contracts automatically execute when predetermined terms and conditions are met.

Smart contract use is extending day by day. There are many real-life problems that can be solved with smart contracts because secure and transparent. Smart contracts are expected to be a part of our daily lives and to be actively used in many industries.

Why are smart contracts used for?

You can create an app on the blockchain and stream it online for users. Those apps are called Dapps because they are decentralized. The most used type of Dapps is DEXes, Decentralized Exchanges. Many cryptocurrencies can be traded, exchanged, lent, or borrowed by using decentralized exchanges. DEXes are apps on blockchains and they are created by using smart contracts. There is no middleman on DEXes. Many successful DEXes are used to open a saving account, lend and borrow funds without needing a KYC or ID verification.

Smart contracts are also used to create a government voting system. A decentralized platform or an app created on a blockchain by using a smart contract can be governed by its users. Smart contracts allow app users to vote and make important decisions for the app.

Smart contracts also allow users to create NFTs (Non-Fungible Token). NFT is used to prove ownership of digital work. Once a digital work is signed and saved on a blockchain with a smart contract, it can not be changed. NFTs are good for copyright purposes.

How many smart contract coins are there?

There are many smart contract blockchains on the market now. Ethereum is the most popular smart contract blockchain. Ethereum is the native coin of the ERC20 blockchain system. Other popular smart contract blockchains are Binance Smart Chain and its coin BNB, Cardano ecosystem and its coin ADA, Avalanche blockchain and its coin Avax, Dot for Polkadot, Sol for Solana, Link for Chainlink, and Algo for Algogrand blockchain systems. Each blockchain ecosystem has its own features and dynamics. Ethereum is the most popular and oldest one and it is the most decentralized ecosystem but it comes with a price. Gas fees (the fee you pay when you use the system for transactions) are too high. For example, the Avalance ecosystem has more than 4000 validators from all around the world while Ethereum has more than 200,000 from all around the world.

Different ecosystems use different methods. The most common and well-proven method is PoS (proof of stake) which is used by Ethereum. Proof of stake is an innovation after Bitcoin’s proof of work method.

Bitcoin ecosystem uses PoW and it requires a lot of computing but PoS requires less computing since it doesn’t require every transaction to be verified by the entire system but requires randomly selected transactions by randomly selected validators.

There are new developments on the methods used by blockchains to improve efficiency. Zero-knowledge proof is the latest method by new generation blockchains.

There are also roll-up and layer 2 developments on the Ethereum network. Since Ethereum is the second maximum security network after Bitcoin, Ethereum Network consumes too much energy and requires too much computing. As a result, transaction costs are very high on the Ethereum network. There are now new networks and ecosystems trying to create a new parallel layer for Ethereum and scale the network and lower transaction costs.

Types of Smart Contract Coins

Different blockchain ecosystems have their own native cryptocurrency. We can separate them into two groups; inflationary and deflationary. Deflationary cryptocurrencies have a maximum supply. The number of supplied coins is predetermined at the beginning and can not be changed or added to new coins. For example, the Maximum supply for Bitcoin is only 21 million. Ethereum has a more complex system with its supply. There are new Ethereum coins that are mined while there are Ethereum coins that get burnt as transaction fees at the same time. Some smart contract coins have a limited maximum supply while some don’t.

Advantages of Smart Contract Coins

Smart Contract coins are promising coins because they are meant to solve real-life problems and have use cases. Smart contracts and blockchains are very promising technologies. They will replace the notaries and copy mark offices in near future.

Smart contracts have a key role in industry 4.0 which means the production with machines that communicate with each other. Smart contracts can be used as a key, or a lock to grant permission to other machines to operate inside another machine’s software.

Not sure if it is a plus or minus but smart contracts are irreversible. It means once the smart contract is written, added to a blockchain, you can not delete or reverse it.

Disadvantages of Smart Contract Coins

Bitcoin is the first blockchain cryptocurrency and there are many others. The reason there are many different ecosystems with different blockchain technology is there is no perfect solution. The biggest dilemma is that the more secure the blockchain is, the more computing power needed, and the more computing power used, the bigger is the environmental cost. The leading cryptocurrency Bitcoin’s network energy consumption is more than almost 150 nations in the world. There are new ecosystems trying to lower the environmental cost but they do it by making concessions.

There is another big debate about smart contract coins is their legal status. Most of the cryptocurrencies are not regulated and should be invested after research and at your own risk.

How to Buy Smart Contract Coins?

You can buy smart contract coins on centralized and decentralized exchanges. If it is going to be the first purchase of a crypto coin, you definitely need a centralized exchange to buy some cryptocurrencies. Smart contract coins are more promising compared to many other coins. Because other coins are built on a smart contract and pegged to the ecosystem’s native currency. For example, if you create a Dapp which is a protocol and you want that protocol to have its own currency. You need to pay a smart contract coin to create a new coin depending on the blockchain you preferred. If the smart contract is written on Binance Smart Chain, you need to spend some BNB coin, If you use Avalanche chain, you need Avax. That makes smart contract coins irreplaceable.