A brief analysis of hot topics and blockchain payment projects in 2021: LTC, BCH, USDC, ACH, etc.

The internationalization trend of online payment is becoming increasingly obvious.

In 2020, BTC, which uses blockchain as the underlying technology, is favored by traditional institutions with a sense of breakthrough due to its digital gold properties and flexible usage in the field of value storage. It has been gradually verified over time, and I believe that BTC will be further recognized globally. In the hot spot analysis in July 2020, 5 hot spots (ETH, Shelley (ADA), SOV (Algo), AR, Fil, etc.) also generated a 2-10 times increase in market value. The Defi hot spot suddenly hit around August, which also benefited from the continuous increase of USDT and the increased attention and quantitative easing brought by the BTC institutional bull market. I personally remind general investors to be cautious in participating in Defi and soil mining projects, because it seems that there are more runaway pit projects in Defi than conscientious projects. Readers must have their own research and judgment, and do not blindly believe in anyone's analysis and ideas.

Personally, I think the hot spots in 2021 should focus on the following points:

1. Will the latest BTC ETF proposal be approved by the US SEC? Will traditional financial institutions enter the market after the market stabilizes?

2. Further application of blockchain technology in the payment field (CBDC, Paypal, Bitpay, Alchemy, LTC, etc.)

3. Further cooperation and expansion of large-scale projects of compliant schools: USDC, Algorand, ETH 2.0 continued transition, etc.

4. Polkadot's series of slot parachain operations and developments continue to attract industry attention

5. Further expansion of DeFi applications - growth opportunities, risks and default leverage coexist, so be cautious

6. The freshness and gameplay innovation brought by the NFT hotspot (be careful of excessive bubbles)

7. Unpredictable WSB-like style, unconventional play, advance ambush, sudden call

In addition to value-added applications, blockchain technology will also be a key area of ​​flourishing and contending in the payment field in 2021-2022. Some applications have payment attributes, such as BTC, LTC, BCH, and USDC. Some types provide payment system bridge functions, such as Bitpay and Alchemy. Some are public chain ecosystems, but they have fast processing capabilities and provide development ecosystem platforms, such as ETH 2.0 and Algo. This article will briefly analyze the value and differences of several types of blockchain payment and settlement applications. BTC is not recorded in this article, mainly because I prefer BTC as a large-value gold-like value-added option.

1. Litecoin (LTC)

Category: Asset attributes + Merchants in some countries accept payment

Introduction: The main differences between LTC and BTC are: 1. Block speed: about 2.5 minutes (BTC is 10 minutes), so it can provide faster transaction confirmation. 2. The total amount of Litecoin is set at 84 million, with a market value of about 8 billion US dollars. 3. After halving in 2019, the current block reward is 12.5 LTC, the circulation rate is about 80%, and the mining inflation rate is about 3.96%, which is at a relatively low inflation rate level. 4. The algorithm used by LTC's consensus mechanism PoW is the scrypt encryption algorithm. Compared with BTC, it is easier to mine LTC on ordinary computers before the emergence of ASIC mining machines.

• Application prospects in payment: Merchants that support cryptocurrencies generally support LTC, mainly because LTC has a faster block generation speed and a wider range of popularity. In addition, after the sell-off in the 2017 bull market, LTC’s degree of centralization is relatively low, making it more flexible at the payment level.

• However, the actual daily transaction transfer volume of Litecoin is still at a relatively low level compared to digital currencies such as BTC. Currently, there are about 50,000 to 70,000 transactions per day, and the number of active addresses fluctuates around 150,000.

• Litecoin has always been known as Litecoin Silver. With the halving in 2019, the inflation rate has further decreased. It also has the potential to be similar to digital silver in the payment and storage fields. And the current market value of LTC is also within an acceptable range. After BTC gradually complies with the regulations on a larger scale, the market value potential of LTC will gradually emerge.

2. Bitcoin Cash (BCH)

Category: Asset attributes + Merchants in some countries accept payment

Introduction: The concept of BCH was first proposed by Bitmain, a leading mining company in the industry, to expand the capacity of Bitcoin. The creation of BCH digital currency originated from the hard fork of BTC on August 1, 2017. The BCH on the market has experienced two hard forks in 2018 and 2020. The block size of Bitcoin Cash was expanded to 32MB by 2020. Some people believe that SegWit, which was added to Bitcoin after Bitcoin Core, was not the original design of Bitcoin. Compared with BTC, BCH is more centralized, with the same total amount as BTC. It is also a PoW mechanism and mining output. The current block reward is 6.25, the circulation is about 1,867,656 pieces, and the circulation rate is about 88%. The average daily transaction of BCH is about 200,000, and the active address fluctuates between 60,000 and 100,000.

• Roger Ver, a core BCH holder, often spreads the potential of BCH in the payment field on Twitter, and demonstrates the value transfer reward through the Bitcoin.com website wallet and the instant value transfer mode of QR code.

• However, the price volatility and frequent forks of BCH and the internal instability of the core group Bitmain should have also affected people's enthusiasm for investing in BCH and using BCH to a certain extent. However, not long ago, the Bitmain equity dispute, which had a wide impact, also ended with one shareholder's settlement and withdrawal.

Through the Bitcoin map, we can see that many countries and merchants around the world currently accept BTC and BCH for payment.

3. Alchemy Pay (ACH)

Category: Payment ecosystem + merchant payment applications

Introduction: Alchemy Pay (ACH) provides "safe, fast, compliant, and international" payment system services to global developers (enterprises) and their users. It can realize the free exchange of legal currency and cryptocurrencies, and provide exchange rate locking, security anti-fraud, Bitcoin instant payment, etc. for transactions. At the same time, it has deep technical and resource reserves in the fields of DeFi and mining.

ACH's main businesses include: international payment channels + bank card issuance + buying and selling Bitcoin with legal currency + investment, etc.

• International Payment Channel: In the form of an open platform, we provide online payment solutions for more than 65 countries and regions, 300 legal currencies and 20 digital currencies to global developers (enterprises). Developers can apply for global payment channels in one stop.

• Bank card issuance: Provide white-label bank card issuance services for enterprises, supporting Visa/Master, physical cards/virtual cards, and issuing cards to more than 200 mainstream countries and regions around the world.

• Fiat currency trading of Bitcoin: Provide a compliant fiat currency trading Bitcoin SaaS system for global financial institutions, provide fiat currency payment channels for global cryptocurrency exchanges, and support fiat currency trading of Bitcoin, Ethereum and other mainstream cryptocurrencies in 22 mainstream countries and regions around the world.

The value of ACH: When paying Alchemy Pay related service fees (such as using payment channels, transfers, bank card applications, etc.), you will get more discounts and can participate in investment or mining. ACH tokens are used as intermediate settlement tokens of the network consensus protocol. In the process of free exchange between fiat currency and cryptocurrency, they are used as collateral settlement equivalents for guarantee and anti-fraud, providing Alchemy Pay with network value liquidity and security guarantees.

Alchemy Pay is one of the developers of the encrypted payment cashier platform of Shopify, a US-based e-commerce service platform worth hundreds of billions of dollars. Alchemy provides underlying technology and overall payment solutions, while other digital currencies such as LTC and BNB directly provide upper-level payment tokens.

ACH currently serves more than 100 world-renowned developers such as Shopify, QFPay, Arcadier, Binance, Gemine, and more than 3,000 corporate merchants such as Pricerite Group, Aldo Group, and CeLaVi Group.

4. USD Coin-USDC

Category: Compliant payment stablecoin

Introduction: USDC, or USD Coin, is a regulated stablecoin issued by Circle, a regulated financial institution, and backed by all reserve assets, which is exchanged for US dollars at a 1:1 ratio. USDC is governed by Centre, a membership alliance that develops technical, policy and financial standards for stablecoins. Currently, the circulation of USDC is 5.1 billion US dollars, mainly issued on Ethereum and blockchains such as Algorand. Personally, I speculate that due to the sudden surge in GAS fees during large-scale hot transactions on Eth, resulting in rising costs, and the foreseeable mass production of USDC as a more compliant stablecoin, USDC is likely to choose Algorand and other fast, high-performance and compliant public chains for large-scale use after 2021 before ETH 2.0 is officially launched.

Use in payments: In December 2020, USDC-Circle joined Visa's growing Fast Track programme, which already has hundreds of fintech companies, including about 25 crypto wallets. Circle's USDC functionality will be available to other members of the program, and it will work with the payment giant to issue the first Crypto VISA corporate card, allowing cardholders to use USDC at any of VISA's 60 million merchants. And payment underlying technology providers such as Bitpay and ACH will also actively support compliant international stablecoins. The international financial use of USDC and compliant use such as international trade can be expected. Although USDT is still the most popular stablecoin, the growth rate of USDC should not be underestimated.

5.CBDC-(Central Bank Digital Currency)-China DCEP

Introduction: CBDC is a general term for various proposals involving digital currencies issued by central banks. Central bank digital currency is also called digital legal tender or digital base currency. In my country, it is called DCEP-Digital Currency Electronic Payment. At present, the domestic DCEP is still in the testing point stage and is progressing steadily.

The essence of DCEP is the digital form of legal tender, which can be understood as paper money turned into digital form. Its essential attributes are exactly the same as cash, and its legal status is the same. The currency in Alipay and WeChat Pay can be simply understood as the electronic form of M2 currency, such as the digital form of deposits, rather than digital currency; digital currency is a distributed architecture based on blockchain technology, while ordinary currency is based on the current common underlying architecture of the Internet. DCEP is also mainly used on M0,

M0 = Cash in circulation

M1=M0+demand deposits

M2=M1+various time deposits, certificates of deposit, trusts, etc.

M3 = M2 + other various short-term liquid assets (short-term government bonds, bills of exchange, commercial paper)

So we can find that DCEP mainly refers to cash in circulation. Since it is cash in circulation, there is no such thing as savings income, so holding DCEP is interest-free. Wallets based on blockchain technology can make DCEP have relatively higher privacy, independence and portability. Our usual WeChat and Alipay basically have to be bound to bank accounts for recharge and transfer, while DCEP can be independent of bank accounts and has higher convenience and flexibility.

The gradual improvement and use of DCEP will further deepen the influence of RMB internationalization, and have a very important impact on the status and flexibility of RMB in the international field. At present, the stability of USDT, USDC and other USD-pegged currencies is still the dominant force in the blockchain field, and the depreciation of the US dollar has also reduced its stability. If DCEP can be compliantly and maturely applied to the blockchain world, it will be a great blessing for the Chinese people.

Summarize:

Payment, as an important application field of blockchain technology, is also closely related to our daily life. The advantages of digital assets such as speed, convenience, security, and time saving are already very obvious. Payment applications will also be the first field to develop in the blockchain field. The popularity of digital currency in payment will also drive the popularization of blockchain technology in various industries.

As the internationalization trend of online office, online entertainment, and online payment becomes increasingly obvious, the expansion of blockchain applications in payment by various countries, including large companies such as Paypal, will surely accelerate further in 2021-2022. Therefore, for payment underlying projects and payment contract projects, BTC, LTC, BCH, ACH, ALGO, BNB, USDC, etc. will all have the potential to shine in the field of financial payment.

At the same time, readers also need to improve their ability to judge value and scams. In the bull market, there will be a constant stream of projects that run away and projects that are overstated to lure you in. Therefore, strengthening your own judgment logic can allow us to truly ride the wind and waves.