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THETA Coin Investment and Price Prediction 2020

Author: Martin Moni
Martin Moni
All publications of the author

Most digital coins focus on money transfer, and they have been very successful such as Bitcoin. Many others have also prospered by providing a platform for decentralized apps such as Ethereum, but there haven’t been more uses for digital coins. Except for the likes of Theta, which focuses on digital streaming. Although it may not be a completely novel idea, Theta has been the first web to make the service actually possible and even better with the help of ledger technology. This is the story of Theta, its investment opportunities and how you can trade this coin in 2020.

Theta background information

As people get more connected, the need to share data and information has grown stronger mostly with the use of visual streaming. But few people understand exactly what it takes to watch a funny visual on, say, YouTube. Statistics show that 1 billion hours of visuals are watched on YouTube every day, which means there are millions of people streaming visuals at any given time. (These are the: 10 Most Important Resources to a Coin Trader)

Enter Theta…

To achieve this incredible feat, YouTube uses massive data centres around the world to store the data. Although YouTube is the largest and most popular visual streaming service around today, it isn’t the only company that has to grapple with the problems that come with the environment. Other companies such as Netflix in the visual on demand (VOD) industry also have the same issues to deal with; as is a recently popular industry, eSports. PricewaterhouseCoopers estimates that the current eSports industry will grow to produce revenue of $1.58 billion annually by the year 2022 and currently has over 400 million viewers every year. Meanwhile, the total global visual streaming market is growing at an annual rate of 17.9% up to 2022 when it is expected to reach $83 billion according to Statistics MRC. (Before investing: Learn How Coin Scams Operate And Avoid Them)

In the eSports space, Twitch is the leading company, but YouTube is not being left behind as it also offers similar services. But for these companies, real problems arise when there are multiple users streaming visuals at high quality. For instance, 4K visual quality can take up to 48 Mbps while high-quality 16K VR resolutions can take up to 768 Mbps. When millions of users are streaming such visuals, the demands can be very high and sometimes unsustainable. It gets worse in less developed countries where the CDN is not as extensive leading to cutouts.

A simple solution to such problems is to use multiple points of presence (PoPs) that store data in the form of a cache. Compared to data stored in a hard drive in a data centre, data in a cache is more easily accessible and thus helps to reduce latency. Popular services like YouTube have an extensive web of PoPs that create a Content Delivery Web (CDN). (To understand more about the ledger, read: The lowdown on coin)

Any other company hoping to compete and ensure great visual quality must create a CDN, but it doesn’t come without its downsides. First, it is impossible to store all data in a cache memory, so only the top trending visuals are cached. Second, it is costly to maintain such a web, which explains the rise of cloud service providers like Amazon and CDNs such as Akamai Technologies. (This is: The Strategy Of Coin Whales In 2019)

To eliminate these problems, Theta hopes that, with the help of ledger technology, this problem can be overcome through load sharing. The idea is to have users lending their devices to be used as caching nodes for the temporary storage of data. Once the web of nodes gets large enough, visual streaming will be much faster and will be capable of higher quality because data won’t have to travel too far nor will the quality vary. Besides, this cut in distance from PoPs will get rid of latency and enable higher bandwidth technologies like VR and even light field technology. (Do you know these: 5 Tips to Choosing the Ideal Coin Platform?)

It doesn’t stop there, because the Theta whitepaper also claims that its web will cut down energy and maintenance costs by 80%. As you would expect, it takes a lot of energy to maintain the data centres most companies rely upon. With a ledger, Theta won’t need to use such data centres and can, therefore, do away with most energy costs. Finally, the web will be more resilient because there will be thousands and even tens of thousands of nodes.

One should also consider changing laws to do with net neutrality. Following the FCC decision to repeal net neutrality, telecom companies are free to control bandwidth to users depending on their subscription. For example, an ISP may throttle access to Netflix in favour of Amazon Prime because the latter paid them for faster services. Through Theta, such a problem can be avoided and ensure truly free and fair access to the internet. (Gram (TON) Vs BTC in 2019: Best Worldwide Coin Fight, Pros, and Cons)

History of Theta

The story of Theta goes back several years when Mitch Liu and Jieyi Long co-founded SLIVER.tv back in 2015. It was meant to be a live streaming website specifically for eSports and it quickly grew in popularity to list games like CSGO, Fortnite, League of Legends and many more. Viewers can also watch live streams from individual streamers and earn rewards in the process. The streaming services are available on all devices and also VR headsets. Sliver.tv would later create a ledger arm called Theta Labs that is meant to transfer the company’s streaming services onto the ledger. (Do you know: How Did Tether Coin Survive The Coin Arena Selloff?)

Investors were quick to spot the opportunity and many VC companies made an investment for a total of $56 million to date. Some of these companies include Sierra Ventures, Nirvana Capital, Greycroft and many more. To grow the company even faster, Theta hired some very qualified staff onto their team. These experts were sourced from major companies such as Sony, YouTube, Verizon, Microsoft, and even competitor Twitch. (These are: The Most Prominent Coin Hacks and Scams You Should Know)

Considering the potential of the technology and advantages of the ledger, the two seemed like a natural fit, and thus Theta was formed. Theta provides ledger solutions with the help of a very qualified team for the streaming of various services. So far, Theta has partnered with Sliver.tv, Samsung VR, MBN, a major media company in Korea, CJ Hello, Pandora.tv and BitMovio. The continued growth of Theta seems very likely, and this company sure looks to have a bright future.

How it works

The best way to understand how this company works is to break it down into three perspectives as follows.

Theta web

At the heart of the service is Theta ledger, which is made up of multiple nodes. These nodes are made up of individual user devices, but they would have to achieve certain standards in hardware and resources to become part of the web. Nevertheless, visuals are not actually stored on the nodes because that would be impossible due to storage demands. Instead, data will only be cached temporarily depending on the needs of a particular region. (Find out how PoS is working by reading the: Cosmos (ATOM) price prediction 2020)

Operating such an extensive web with high bandwidth demands requires a very scalable web. Many crypto webs have suffered in the past due to scalability when transaction volume became too high. Theta is not expected to suffer from the same problem because it uses a proof of stake (PoS) system rather than proof of work (PoW). PoW systems are prone to web lags because of increased transaction volumes while also being very energy inefficient due to the need for high processing power for hashing. On the other hand, PoS systems have been favoured by the likes of Libra coin, a potentially very successful coin. (Find out: How Libra Coin Will Change the World's Financial System)

PoS webs need to have a consensus mechanism for the nodes to agree on the verification of nodes. Theta ledger relies on a modified version of the Byzantine Fault Tolerance concept referred to as multi-level BFT. To enable this PoS system are two separate levels – a validator committee and a pool of guardians. The validator committee consists of a small group of people overseeing nodes numbering up to 20 that are actually responsible for the validating of blocks. For now, this pool is still being run by Theta Labs because the web is not yet well established. Theta is also trying to ensure that the web speed is high to motivate content creators to join.

A secondary pool of guardians is much larger and may consist of up to tens of thousands of nodes. This second category assists in the consensus role while also performing minor block validations at certain points of the web by agreeing to the hash at checkpoint blocks. The guardian pool ensures the validity of the blocks and prevents double-spending. The system has been made as such to ensure that there is always a high throughput in the entire web regardless of the number of transactions. (Do you know: What is the future of coin in finance)

Facilitating the communication between the guardian nodes is a system called an aggregated signature gossip scheme. Most PoS systems depend on direct communication between the nodes facilitating the verifications. With Theta ledger, signals are sent through the web until it reaches the other guardian nodes. Think of it as passing notes in class – a note is written for a specific person in the class, and it is simply handed off by the other students until it reaches the intended recipient. Such a system is more efficient and aids to improve web speeds. (These are the: Coin Regulations Around the World)

Theta coin

On top of the ledger in Theta are the tokens used within the web for transactions and as rewards. The most significant one is Theta Token denoted by the ticker THETA among cryptocurrency exchanges. The token was first released to users through a private ICO held between January 8 and February 8, 2018. During the ICO, 300 million THETA tokens were issued out of a total of 1 billion tokens. The company managed to raise $20 million in ether tokens, which was the company’s target.

At first, the token was hosted on the Ethereum web since it was an ERC20 token, but the company would later launch its own ledger where THETA tokens were swapped at a 1:1 ratio. The Theta mainnet was launched on March 15, 2019, at which point the token swap was done. Alongside THETA was a secondary token, Theta Fuel (TFUEL), that also runs on the Theta ledger. There is a maximum limit of 5 billion TFUEL tokens, and these will be the main token for transactions on the web. (Now: Coin Ads Banned From Google And Social Media)

THETA is mainly used to reward individuals who allow their devices to be used as nodes. Since the web depends on having numerous nodes for caching, anyone who donates their device to the web will be rewarded using THETA. Furthermore, this token is used in the staking process to allow Proof of Stake (PoS). The higher the number of THETA tokens staked, the higher the chances of being classified into the guardian pool. (Do you know: Which Are The Most Influential Coin Arenas By Country?)

To promote users to stake their tokens, anyone who does so will be rewarded using TFUEL tokens. These are to be used mainly for payment, tips and other transactions within the web. For instance, content creators may be paid or tipped for their content within the web using TFUEL. Because the company hopes to have a lot of transactions, the number of TFUEL tokens has been made higher to ensure scalability. Another benefit of having two separate tokens is that it eliminates double spend and guarantees transactions. (Investor Tips 2019: What To Include In Your Portfolio)

Since the ICO was held last year, THETA has been widely accepted among the world’s most popular crypto platforms including Huobi, Binance, Bithumb and many more. Suffice it to say that there is no shortage of sources to buy the tokens. Moreover, the coin is also supported by most wallets, starting with the proprietary Theta Wallet and many other popular crypto wallets.

Rewards to the users

Theta has some very ambitious goals, which seem to be very likely especially for the users. Content creators face a lot of challenges that Theta aims to eliminate, thus there should be more rewards.

First and foremost is that content creators will receive more rewards than they currently do. If a creator on, say, YouTube, gets paid for their work, the amount is usually much less than YouTube actually makes. This is because YouTube has to spend a lot of money maintaining its CDN and global system of data centres all of which require a lot of resources. Compared to this, Theta does not rely on any centralized data systems of CDNs, so the costs of maintaining the web are a lot less. Therefore, content creators can earn more for their work directly from their customers – cutting out the middle man. (Do you know: What is An ICO and How Can I Make Money On It?)

Viewers will also be able to tip creators using TFUEL directly on the platform. On other platforms like YouTube, creators have to rely on other services like Patreon to receive tips and payment. Theta can make this entire process streamlined, making both the viewers and creators happier. If a creator can provide their content through conventional platforms and Theta, this would only increase to their outcome, thus would promote higher quality content which is good for everyone.

The second and perhaps most critical loophole Theta hopes to fill is that of security. It is possible for hackers to take down a network like Switch.tv and even YouTube by attacking the primary servers. Without the central server, the entire CDN goes down, but Theta does not have a centralized server. It would be impossible to take down all nodes when there are thousands of them. Since Bitcoin was launched in 2008, no ledger web has ever been hacked, and this is the security of ledger extended to content.

Investing in THETA tokens

Inasmuch as THETA tokens were meant to be a reward system for web node operators, nothing can stop you from speculating on the price changes. To become a better investor, you must first know how the token has performed since it was launched before reading out future price predictions.

Historical performance of THETA on crypto exchanges

Following the ICO in January 2018, THETA was first listed on crypto exchanges at the price of $0.15. As this was also the time when most coins were soaring in prices, THETA followed suit to reach an all-time high of $0.31 on January 27, 2018. From then on, the token’s value has fluctuated below this limit and is currently trading at about $0.08 at the moment of publishing. This is more than 46% lower than the ICO price and 74% below the all-time high value reached ever.

From the above chart showing the price of THETA over its lifetime, it doesn’t look much different from that of many other coins in the market. Since January 2018, most coins have lost their value and market capitalization as well for various reasons. It would seem that THETA has not been immune to the same problem and it should be interesting to see how it performs in the future.

Price predictions for 2020

So far this year the value of THETA has almost doubled from $0.05 in January 2019. Market capitalization has also more than doubled from $33 million at the start of the year to $73 million today. This growth has been thanks to the recovery of the crypto markets in general after a sharp decline in 2018. 2017 up to the start of 2018 was the time coins really took off and recorded massive growth rates. Many have claimed that this may have just been due to the hype and perhaps even a bubble. When crypto prices started to decline, some investors thought it was the end of the coin market, but instead, it has remained very stable. This is because crypto has finally been embraced by institutional investors who have the resources to purchase large amounts of crypto. (Read more about this here: Will institutional investors and sharks invest massively in bitcoin in 2019?)

This is good news for coins in general and Theta Web in particular because investors are more discerning and only invest in worthy coins. To see the value of Theta nearly doubling in a year only goes to show that investors have started to see the value of the web and are increasing their investment in it. Also because THETA is earned by staking, it shows that there are more people staking their coins as you can see from the current 870 million THETA tokens in circulation. Investors are also pouring money into the project leading to the burgeoning market cap, showing more confidence.

It is at this point that the secondary token TFUEL must also be considered. Unfortunately, TFUEL has only recorded price declines ever since the launch and the trend has remained mostly downward. This is not a good sign for the web because it may indicate a lack of demand for the token. Since it is used for transactions within the web, that could mean there aren’t many users. But it could also be attributed to a large number of tokens being issued on the web. Thus far over 3.8 billion tokens are in circulation with a limit of 5 billion. As more people keep using the web and the limit of coins is reached, the value of TFUEL will definitely rise from the sudden low supply. (After The BTC Cash Fork, Which Is The Real BTC?)

The only question now is whether the demand for Theta Web will rise or not. The streaming industry is definitely growing, and VR, in particular, is growing extremely fast. An advantage for Theta over its competitors is that it is the first to launch a ledger system through which it can offer its services. There are no other companies with such an advanced ledger system and this gives Theta an edge. (Does BTC Stand A Chance Of Becoming The Worldwide currency?)

It is a long way, though, with the likes of YouTube and Twitch already having a massive following and popularity. But ledger certainly seems to be the future of the technology, and when that future arrives Theta will be miles ahead of the competition. That means Theta is more of a long-term investment than a short-term one, and investors must be ready to wait several months and even years to see any significant growth. Nevertheless, it is certainly a worthwhile investment for the position trader.

 

If you want to know more before investing in Theta, watch this visual from an expert:

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Risk Warning: Your capital is at risk. Statistically, only 11-25% of traders gain profit when trading Forex and CFDs. The remaining 74-89% of customers lose their investment. Invest in capital that is willing to expose such risks.
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