Thinking of investing in crypto? Here are 4 coins and tokens that are actually useful

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Sometimes it can feel like crypto only solves problems within the crypto world. But these four projects are really useful.

Important points

• Cryptos that are actually useful are much more likely to survive long term.
• Livepeer and Helium use decentralized networks instead of expensive infrastructure to solve real-world problems.
• VeChain uses the blockchain to manage supply chains, among other things.

It’s been a tough year for crypto investors. Even top cryptos are down as much as 90% from their all time highs and many people’s portfolios have been decimated. Unfortunately, there is a good chance that prices will remain low for some time to come. Some see it as a buying opportunity, which it can be. But there is also the risk that many projects – especially those without much utility – could collapse before the market improves.

If you’re considering investing in cryptocurrency, it’s important to fully research each project and think about how it might work in the long term. Look at the management, how it stacks up against the competition, what it actually does, and who will use the product. As crypto enthusiast and billionaire investor Mark Cuban pointed out, it’s not enough to just be a cryptocurrency. If these projects are to succeed, they must still be able to make money, attract users and actually be useful.

Here are four with real-world applications that are already in operation.

1. VeChain (VET)

VeChain began using the blockchain as a tool for supply chain management, and has since expanded into other business uses. For example, let’s say you make luxury handbags. VeChain can track every step of the wallet’s production and sale on the blockchain, so the final buyer knows for sure that they got the real deal and not a knock-off.

VeChain has also worked with Walmart China to track fresh meat and vegetables all the way from farm to store. Increased traceability means that if there is a problem with a particular batch of food, it is easier to contain and control it quickly. Like other cryptos on this list, VeChain is available from some but not all top US crypto exchanges.

2. Live peer (LPT)

Video streaming is becoming increasingly popular and extremely expensive. Video content must be processed so that it can be accessed on different devices with different bandwidths. This is called transcoding, and it requires a lot of computing power.

Livepeer essentially pulls together unused data resources from a network of individuals and uses them to transcode videos. Content producers get scalable, affordable transcoding, Livepeer doesn’t need to buy expensive infrastructure, and network participants get LPT tokens, which have a real-world value.

3. Helium (HNT)

Helium is a decentralized wireless network powered by a network of long-range hotspots. Initially aimed at Internet of Things devices, such as smart pet collars, self-driving cars or fitness devices, Helium is now also expanding to 5G and WiFi connections. Network participants operate a Helium hotspot and receive rewards for providing connectivity.

This concept of using crypto-tokens to reward participants is an interesting facet of blockchain. Livepeer and Helium are two of many projects that reduce a company’s upfront infrastructure costs by using a network of individuals to do the heavy lifting. These individuals earn a portion of the fees in what is a more community-based, decentralized business model.

4. Cardano (ADA)

Cardano is a bit of a “love it or hate it” crypto, and some may question its real value. It is an ecosystem like Ethereum (ETH) that can host other crypto projects on its blockchain. Critics point out that it was slower to launch its smart contract functionality, and the ecosystem does not yet have as many apps as other similar cryptos.

However, Cardano has something else going for it: It’s a great example of real blockchain tools. For example, Cardano has partnered with the Ethiopian Ministry of Education to register the academic credentials of five million students on the blockchain. This will make it harder to cheat the education system, and potentially help students access opportunities such as university education or international jobs. Another project on the Cardano network, called Empowa, aims to help underbanked individuals access funds to build homes.

The bottom line

If blockchain technology achieves even a fraction of what is promised, it could transform entire industries. Medical records can be securely registered on the blockchain and you, the patient, can control how they are accessed. Insurance claims could be paid out automatically when certain criteria were met. You can even store the deed to your house on the blockchain.

The problem is that the industry is in its infancy, and there’s a lot we don’t know about how it might develop or whether it will make it through the current crypto winter. Think of it as akin to the early days of the internet. Everyone is chasing the next Amazon, but for every success story there will be hundreds of failures.

As an investor, looking for cryptos that are actually useful is a good start. Still, it’s important to only invest money you can afford to lose, and to ensure that crypto only makes up a small percentage of your broader portfolio. That way, you can still invest in smaller, riskier projects, but won’t face financial disaster if they don’t live up to their potential.