Cronos: Good Place To Buy, But Caution Is Warranted
By Andy Wang | Crescent City Capital Market Analyst Intern
What is Cronos [CRO]
Cronos is an Ethereum Virtual Machine (EVM)-compatible chain with added support for IBC (Inter-Blockchain Communications) networks based on the Cosmos SDK. In other words, it is compatible with Ethereum and Cosmos-based ecosystems, allowing for easy porting of Ethereum smart contracts and decentralized apps (dApps).
The network, which launched on November 8th, 2021, runs parallel to the Crypto.org blockchain, the network that powers Crypto.com’s Pay feature. Crypto.com is the company behind both blockchains and has existed in the cryptocurrency space for several years, having launched in June 2016 with its headquarters in Switzerland.
The crypto payments company, co-founded by Kris Marszalek, Rafael Melo, Gary Or, and Bobby Bao, initially operated under the name Monaco Technology GmbH. It was later rebranded to Crypto.com, and its platform token, called Monaco Coin (MCO), was also changed to CRO (Crypto.com Coin). With the launch of the Crypto.org blockchain, the company rebranded the token name to Cronos but retained the ticker symbol CRO.
CRO is instrumental in powering the entire Crypto.com ecosystem and acts as the native token on both Crypto.org and the Cronos blockchains.
What makes Cronos Unique?
CRO primarily focused on providing utility for users of Crypto.com’s payment, trading, and financial services. CRO holders can stake their coins to act as validators, earning fees for processing transactions, and use CRO for settling transaction fees on the Cronos Chain. With the Crypto.com Pay app, users can enjoy cashback rewards when paying merchants, purchasing gift cards, and making peer-to-peer transfers. In terms of trading, staking CRO allows users to earn rewards and benefit from annual interest rates up to 10-12% on their CRO holdings. As a driving force behind Crypto.com’s mission to increase global cryptocurrency adoption, the company continuously explores and develops new use cases that empower users with greater control over their finances, data, and identity.
1. Cronos Bridge
As the name alludes, a bridge is a structure that connects two things. In the case of Cronos, its Bridge enables users to seamlessly transfer assets between various blockchains, thereby fostering interoperability. So far, the Cronos Bridge supports the following networks, which are based on the IBC: Crypto.org, Cronos, Cosmos, Akash. And to take advantage of the Cronos Bridge, you can use any of these supported web wallets: Metamask; Kepler; Crypto.com Defi Wallet.
2. Cronos Wallets
Cryptocurrency wallets are tools used to store private keys that control a user’s assets on a blockchain. They also facilitate asset transfers between various users. On Cronos Chain, the following self-hosted wallets can send, receive and store CRO tokens as well as be used to interact within the Cronos ecosystem: Crypto.com Defi Wallet; Crypto.org Chain Desktop Wallet; MetaMask; Math Wallet; Nabox; Trust Wallet; ImToken; CoolWallet; Krystal Defi; BC Valult.
3. CRO Token
The Cronos (CRO) token was initially called ‘Crypto.org Coin,’ but the name was changed to reflect the decentralized nature of the coin and the goal of making Cronos a diverse and extensive network. The token has a total supply of 30 Billion following a decision by Crypto.com to burn 70 Billion in February of 2021.
The remaining tokens, which were created on the Ethereum platform on the popular ERC-20 standards, were ported over to the Crypto.org Chain, but their utility remains the same. Here’s how the CRO token can be utilized across the Crypto.com ecosystem, including within Cronos blockchain:
- Staking – node operators, delegators, and governance proposers need to have CRO tokens to enable their activities. Staking can be done directly on the Cronos platform using supported self-hosted wallets or through a staking service such as the one offered by the Crypto.com exchange;
- Value transfer – CRO can be used to pay for transactions on the two parallel blockchains, pay for gas fees on the Cronos Chain and pay for trading on the Crypto.com platform. Additionally, CRO can be used to make payments across the multiple Crypto.com products such as the Visa Cards and the Crypto Pay app;
- Speculation – traders can speculate on the value of CRO on various trading platforms, including Crypto.com;
The CRO price on April 16th is $0.07279 USD with a 24-hour trading volume of $14,062,331 USD. It has a circulating supply of 25,263,013,692 CRO coins and a max. supply of 30,263,013,692 CRO coins.
As an innovative blockchain network, Cronos is now pushing the envelope toward making cross-chain interoperability a reality. That is its biggest strength. More crypto projects are launching with a similar vision, but Cronos has a leg up because it is launching as part of a family of other already established products.
Its parent company Crypto.com also runs another parallel blockchain dubbed Crypto.org Chain with limited features. Coupled together, the two blockchains complement one another and also enable Crypto.com to offer more advanced products such as Defi and NFT marketplaces, offering more utility to its user base.
To sum up, Cronos has had a very promising start, but only time will tell whether it achieves its vision of displacing Ethereum, which is currently ridden with scalability challenges.