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Cronos (CRO) explained: does fortune still favor the brave?

If you were part of the crypto bull run in 2021, you'll likely remember Crypto.com's (CDC) "Fortune Favors the Brave" catchphrase uttered by actor Matt Damon during televised NFL games. To CDC's misfortune, the now-infamous advertisement signaled the top of the bull market as the crypto market began its downward spiral a month later. The backlash towards CDC was so bad that the exchange had to take down the advertisement and make it private.

Despite this, the Cronos chain (developed by CDC's partner, Cronos Lab) and its native token CRO have continued to make progress behind the scenes. From expanding upon its array of developer tools to keeping CRO inflation under control, Cronos has shown its resilience throughout the crypto bear market. It's also continued to double down on its vision of having an ecosystem that accelerates the world's transition to crypto.

Curious about the future of Cronos and where CDC plans to take it? Read on as we answer what is Cronos and why it might have brighter days ahead thanks to its transparent roadmap.

What is the Cronos ecosystem?

Before elaborating further, it's essential that we clarify one crucial concern. Searching for the CDC's Cronos will often bring up mentions of the Cronos coin and Cronos blockchain. For the sake of clarity, we'll be referring to the Cronos coin as CRO and the Cronos blockchain as Cronos chain.

Additionally, throughout its five-year history as Crypto.com, the Cronos ecosystem has developed itself to offer a whole suite of financial and trading services. From issuing rewards in CRO to an entire DeFi ecosystem, we'll walk you through each aspect of the vast Cronos ecosystem, so you have a better understanding of everything that encompasses Cronos. This includes:

  • The CDC app ecosystem

  • Cronos token (CRO)

  • CDC Visa card

  • Cronos chain and its DeFi ecosystem

Understanding the CDC app ecosystem

Hop onto any app store and you'll be immediately greeted with three separate applications that have the CDC name. They're the Crypto.com app, Crypto.com exchange, and Crypto.com DeFi wallet. Here's a brief description of each CDC app so you're familiar with each of them.

The Crypto.com app allows users to buy, sell, and store cryptocurrency. It's meant to be an easy-to-navigate entry point into the Cronos ecosystem, allowing users to buy crypto with fiat currencies effortlessly with market orders.

This contrasts with Crypto.com exchange, which allows for more complex trading actions that go beyond a simple buy and sell at the last-traded price. Here, you'll find your traditional centralized exchange experience, complete with candlestick charts and limit order fields.

Lastly, there's Crypto.com DeFi wallet, a user-custodied wallet. The wallet grants you full access and control of your crypto private keys. Unlike entrusting your crypto to a centralized custodian on the CDC app, you have complete ownership of your crypto when they're stored in the CDC DeFi wallet. This means you're free to interact with the various decentralized applications (DApps) upon linking your DeFi wallet.

What is the Cronos token?

From MCO to CRO, Cronos has undergone numerous rebranding efforts. However, one thing that remained constant was that CRO was to act as the defacto utility token for the Cronos ecosystem. With CRO, CDC plans to push it as the main medium for users to enjoy various forms of utility in the areas of CDC's payment, financial, and trading services. From receiving cashback in the form of CRO to paying CRO gas fees, CRO is the Cronos token that's fueling the entire Cronos ecosystem.

The history of Crypto.com and CRO

Crypto.com was founded in Hong Kong by Kris Marszalek, Bobby Bao, Gary Or, and Rafael Melo. While it was originally named Monaco and started operations as a crypto wallet and payment platform in 2016, the company renamed itself to CDC in 2018 after purchasing the Crypto.com domain for an undisclosed fee rumored to be upwards of $5,000,000. A year later, CDC unveiled exchange services.

Even after rebranding from MCO to CRO, the coin itself was called Crypto.com up until February 2022, when CRO was given the name Cronos. For CDC, this new name reflects its vision of the decentralization of money and growth of its existing ecosystem.

The Crypto.com Visa card

As one of the main drivers of CDC's popularity among crypto beginners, the Crypto.com Visa card is a prepaid card that can be loaded with fiat or cryptocurrencies and offers spending rewards in the form of CRO tokens. With its sleek metal design and perks like free Spotify and Netflix subscriptions, the Visa card is often an entry point for many crypto curious beginners. The kicker is that CDC users will need to buy in and lockup CRO tokens to enjoy the benefits of the Visa card. This amount ranges from $0 to $500,000 in CRO lockups.

While the CDC Visa card reached peak popularity during the crypto bull market of 2020-2021, the rewards have since been reduced to cut costs. This includes reduced CRO staking rewards and a six-month limit to the free Netflix and Spotify subscriptions for Jade Green, Royal Indigo, and Ruby Steel tier members.You can learn more about current reward tiers and benefits on CDC's Visa card page.

Cronos utility: what's CRO used for?

You'll often hear how CRO is a utility token with plenty of use cases for CDC users to explore and benefit from. From bonus spending rewards to favorable trading fees, here's everything CRO can be used for in the Cronos ecosystem.

  • Visa debit card cashback: when making day-to-day purchases, CDC users can earn cashback up to 5% in CRO alongside other miscellaneous perks and benefits.

  • On-chain transfers: CRO can be used to pay for gas fees when carrying out transactions in the DeFi space.

  • Staking and yield farming: holders can stake their CRO to a validator node or provide it to a liquidity pool on-chain, which generates returns in the form of additional CRO. Holders can also make CRO transfers to make payments.

  • Exchange benefits: As part of their CRO Lockup program, crypto traders can enjoy benefits like reduced trading fees and daily CRO rewards of up to 8% APR.

CRO tokenomics: max supply of Cronos, market cap, and more

Keen to learn more about the tokenomics of CRO? Here are some key statistics (accurate as of December 1, 2023) to take note of if you're planning to trade it:

  • CRO has a circulating supply of 26,400,832,801 and a max supply of 30,000,000,000.

  • Discounting CDC's various CRO rewards and benefits, CRO has an annual inflation rate of 2.5%.

  • CRO's market cap currently sits at $2,393,428,801 and is 90.62% down from all-time highs.

A concern for CRO among crypto traders is that the CRO coin was too inflationary because of its overly generous rewards for its Visa card and staking. While this has been dialed back considerably, CRO still has an inflation rate of about 2.5% and is far from reaching deflationary status.

What is the Cronos chain?

The Cronos chain is an Ethereum Virtual Machine (EVM) compatible blockchain powered by Ethermint. As the Cronos chain supports the IBC protocol, users can conveniently import cryptocurrencies from the Ethereum, Cosmos, and other chain families into Cronos. One perk of this interconnectedness is that users can take advantage of the interoperability and leverage the rich application ecosystem of Ethereum and Solidity. Given Cronos' plug-and-play nature, developers can port over apps and smart contracts from Ethereum and EVM-compatible chains with ease.

With grand aspirations of being the foundational infrastructure for an open metaverse, Cronos is aiming to serve Web3 users and help them experience the full promise of digital asset self-custody.

Why Cronos has two blockchains

Interestingly, CDC has two blockchains running in parallel to support the overall Cronos ecosystem. They are the Crypto.org chain and the Cronos chain. As both blockchains will support smart contracts written in different programming languages, CDC ultimately intends both to be used for different purposes.

The Crypto.org chain is likely intended to be for fast transaction settlements at very high transactions per second. This would make it suitable for handling NFT interactions and real-world payments. Conversely, the Cronos chain will primarily be used for building DApps and supports smart contracts written in Solidity, which is the same programming language used for implementing Ethereum-based smart contracts.

Does this mean they'll be using different native tokens? Fortunately, since both chains are built on the Cosmos SDK and support the Inter-Blockchain Communication protocol, any standard ICS-20 token can be transferred between chains without a need to wrap them. This means the Crypto.org and Cronos chains will be using the same native CRO coin and will function like BNB between the BEP-2 and BEP-20 token standards.

Cronos chain's proof-of-authority (PoA) consensus mechanism

Curious about how Cronos chain's consensus mechanism differs from other layer-1s? In a nutshell, PoA is a modified form of proof-of-stake (PoS), where a set of pre-approved validators are responsible for verifying transactions and adding new blocks to the Cronos chain. These validators are typically organizations or individuals known to be trustworthy and have a good reputation. This is unlike PoS, in which validators are chosen based on the amount of crypto they stake and the likelihood of being chosen to verify transactions is based on the amount staked by a validator.

While detractors may cry foul at PoA's lack of decentralization, Cronos proponents will argue that this vetting keeps the Cronos chain secure from malicious actors since all validators are vetted beforehand and proven to have a vested interest in the network's success. As of writing, Cronos has 100 active validators, according to the Cronos POS Chain Explorer.

Growing the Cronos DeFi space

Keen to find out more about how Cronos is performing in the DeFi market? According to DefiLlama, the Cronos chain currently has a total value locked (TVL) of about $344,450,000 as of late 2023. Although this may be far from its all-time high TVL of $3,220,000,000, the Cronos chain still ranks in ninth place behind competing DeFi ecosystems offered by Solana and Avalanche. DappRadar paints a similar story, as Cronos has a total of 69,230 monthly unique active wallets interacting with the Cronos chain DeFi ecosystem.

From these statistics, while we might be able to partially attribute the lack of activity to bearish market conditions, Cronos detractors will immediately point out how Cronos isn't living up to its potential. This is despite numerous initiatives to attract more developers to build on Cronos. While top DApps like VVS Finance and Tectonic are driving DeFi activity, Cronos lacks a killer DApp like BNB's PancakeSwap and Ethereum's Aave, which are popular with DeFi natives.

That isn't to discount Cronos' efforts at trying to breathe life into the Cronos ecosystem. Cronos Labs recently announced a $100,000,000 Cronos Accelerator Program that aims to support early-stage crypto projects. According to Cronos Labs, the 12-week program is designed to attract AI-based crypto projects that provide unparalleled speed and efficiency. With the help of mentors like Google and Amazon, the program aims to help take these high-potential products to market.

Cronos and GameFi: Loaded Lions Mane City

Incubator programs aside, Cronos has also recently launched Loaded Lions Mane City — a browser-based Web3 idle tycoon game that instructs players with the goal of building the ultra-luxe mansions of their dreams. Besides boosting the Loaded Lions NFT collection, the game shakes up the Cronos ecosystem by offering users the opportunity to turn a profit by strategizing their building layouts and trying to earn the highest in-game income possible. Even though it's still too early to tell, CDC's foray into GameFi certainly implies they're not giving up on nurturing their DeFi and Web3 scene yet.

Final words and next steps

From offering an attractive metal debit card to enticing users with various forms of CRO utility, the future of Cronos looks promising. While competitors like FTX and Celsius overleveraged themselves and bowed out during the crypto winter, the fact that CDC remains active in the crypto scene today shows that they might be able to turn things around and come out on top during the next crypto bull run.

For the many CDC Visa card holders and CRO stakers, Cronos looks to be a dark horse bet among crypto traders who are still holding on to the mantra that fortune will favor the brave. Will this be the case? Only time will tell as the expansive and dynamic Cronos ecosystem continues to BUIDL and carve out a niche for itself in the crypto space.

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