What’s the most popular crypto trading app at this point? While Coinbase is the most logical answer, another option exists that gives users more options in terms of the crypto assets that they can hold within one wallet. That particular app is Abra, which many of you probably already know due to its’ goal of being known as the go-to location for beginners to invest in cryptocurrencies.
In the last few hours, Abra has pivoted significantly from this focus to one that is much more wide-reaching. More specifically, today, Abra re-branded itself as the place for the average consumer to invest in stocks, ETFs, and cryptocurrencies, all in the same location. Even though Robinhood and other apps are offering the same services, Abra’s move is different because of how it works out on a technical level.
To understand why this is true, it is important to begin by understanding how Abra works. First, with the Abra app, you never actually hold more than one cryptocurrency at a time. If you know anything about smart contracts, then you know that they represent a promise for some kind of exchange of assets or services once certain conditions are met. In the case of Abra, everything basically depends on smart contracts that are tied to the Bitcoin or Litecoin networks.
This means that each user may feel that he or she is holding up to 30 cryptocurrencies, when he or she is really only in possession of two at most. By two, of course, we mean Bitcoin and Litecoin. Reinforcing this point is the fact that users can only ever withdraw any gains that they receive by moving from Bitcoin or Litecoin to fiat currencies like the US dollar.
Because this still represents how Abra does business, going forward, keep in mind that even when you try out the new options of investing in fractional shares of traditional stocks with Abra, you are really only investing in Bitcoin and Litecoin. In the end, because of this, these two networks are the ones to watch to manage your risk in this respect. As long as both continue to represent market leaders, then you will continue to be hedged against a large amount of the risk inherent in all other cryptocurrencies.
By: BGN Editorial Staff