Top Market Cap Coins with a Centralized Model
Bitcoin emerged as a revolutionary force to challenge the monopoly of financial institutions and place the power back in the hands of cryptocurrency users through the blockchain. Cryptocurrencies operate on the fundamental principle of decentralization, seeking to shift control from centralized entities towards individual end-users. The global monetary system has long been governed by centralized institutions such as banks, which have historically prioritized their interests over those of the masses, as evidenced by the financial crisis of 2008. If you want to learn about cryptocurrency trading psychology, exploring the mindset and emotional aspects involved in trading digital assets can greatly enhance your understanding and decision-making abilities in the crypto market.
Bitcoin’s disruptive potential lies in its ability to empower individuals and communities to take control of their financial assets, free from the influence of centralized authorities. Cryptocurrencies are often thought to be synonymous with decentralization, thanks to the global network of trusted nodes that underpins the blockchain ecosystem. However, this ideal is not always upheld, particularly in the case of newer cryptocurrencies with practical real-world applications.
Despite purporting to be decentralized, some of these digital assets merely pay lip service to the concept, maintaining highly centralized elements that run counter to the spirit of a truly decentralized currency. It’s important to remain vigilant, as even some of the most well-known and popular cryptocurrencies on the market today have centralized characteristics that may come as a surprise to some. In the interest of transparency and awareness, we’ve compiled a list of the top coins ranked by market cap that demonstrate significant centralization in their operations and ecosystem.
Theta
Theta has seen a remarkable surge in value over the last 12 months, with its price skyrocketing by an astonishing 17,000%. This meteoric rise has propelled the project into the upper echelons of the cryptocurrency market, currently occupying the ninth spot in terms of market capitalization. The primary goal of the Theta network is to revolutionize video streaming and content delivery services through the creation of a decentralized platform. However, it’s worth noting that despite the network’s ostensibly decentralized structure, it is operated and governed by prominent corporations such as Samsung and Google, with a strong focus on enterprise usage. A recent review by Wu Blockchain discovered the top ten wallets on their own hold more than 61% of the entire Theta tokens, creating a significant danger for industry manipulation and central management.
IOTA
The cutting-edge strategy of IOTA to apply blockchain know-how to speed up the development of the Internet of Things (IoT) is accompanied by a pronounced increase in centralization. The coin is circulating for USD 1.43 and it is positioned 28th in terms of market capitalization. IOTA encountered massive difficulties, most specifically a hack in 2018 of us $4 million, followed by an alternate assault in 2020 which resulted in money currently being transferred from their wallets.
The Tangle was pressured to close down, stressing the network’s risk of being turned off by the founders or maybe some other person. In addition, IOTA created the IOTA oracle that doesn’t function on smart contracts as Chainlink, but calls for information being vetted by the “coordinator” node, adding a level of centralization as a result.
XRP
Ripple Labs provides full command of the nodes which make up the Ripple system, which is focused on facilitating seamless cross-border transactions for financial institutions. The firm has additionally been engaged in a dispute with the Securities as well as Exchange Commission, which asserts that Ripple is working as an unregistered security. Consequently, XRP happens to be removed from many US exchanges as well as Ripple has sought to enhance its presence in some other areas and also teamed with banks in Australia to use the Ripple Network for quicker trades. Ripple additionally partnered with MoneyGram in 2018, however, the agreement was halted after accusations by the SEC in 2021. Despite these obstacles, XRP was able to keep its status as the seventh-largest cryptocurrency by market capitalization, which is testimony to the coin’s acceptance in international marketplaces.