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Why API3 could be a big winner in 2022


Fool.com contributors Chris MacDonald and Jon Quast explain why API3 (CRYPTO:API3) could be one of the top cryptocurrencies to watch this year. This conversation comes from January 12 edition of “The Crypto Show” on Backstage pass.

Jon Quast: The first one here is the one you mentioned, API3.

Chris McDonald: API3 is the one I started to dive into. I introduced it earlier in terms of allowing APIs that are essentially the building blocks of applications to be integrated into the blockchain from off-chain data sources.

One that we’ve talked about on a few different shows is Chain link (CRYPTO:LINK). This is called the oracle network, which helps bridge the gap between off-chain data streams such as price streams. If you’re a decentralized exchange, it’s probably a good idea to have real-time price feeds from the outside world, feed, or exchange. Or whether it’s weather-related operations with real-time weather data. Whatever real-time data source is needed for a blockchain-based application, they need to use an oracle network right now to solve this problem.

API3 is a smaller scale project. Its market cap is $140 million. It’s way down, 360th on the list right now. But this is one of the more speculative ones I’m looking at because API3 approaches the problem of off-chain data integration differently.

They are looking to launch what are called decentralized APIs or dAPIs I guess. With these, essentially those that developers or vendors of proprietary APIs can directly and seamlessly integrate with the blockchain. Not only that, it would be blockchain independent. If you are doing a project that you would like to cover different blockchains, this might help solve this problem.

Right now it’s in beta, so it’s early stages of development. It’s high risk, but the team behind seems to know what they’re doing. This is an intriguing use case and an intriguing potential market they could tap into. There are a lot of risks with that. This is one that is definitely like a much higher risk.

But digging through the weeds and trying to find some interesting ones is one that really caught my attention in terms of what might be perhaps the riskiest and most profitable investment I would be interested in. This would probably be one of the ones that would pique my curiosity.

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