Cryptocurrencies seem to be the new big thing at the threshold of the Industrial revolution 4.0 and the digital transformation of the entire human world.
Digital money has turned to be a worldwide phenomenon, and at the same time, it is still not deeply understood by the majority of people.
While corporations and enthusiasts start going deep into blockchain technologies a big part of humanity lives their offline lives.
The very existence of crypto money is already a proof that there is a change in the society collective thinking and the type of confidence among us.
But will cryptocurrency become the 21st-century gold? We are about to see.
Brief Intro to Cryptocurrencies
Cryptocurrency is a computer code; which people accept as digital money.
Each type of cryptocurrency is based on open-source and uses encryption technology. The main idea is that cryptocurrencies keep their owners anonymous although Bitcoin, for example, saves data for each transaction which is visible through the network.
The primary feature of cryptocurrency is that it is not issued by a central authority and thus it is prevented from manipulations and government decisions.
Some countries have decided to ban cryptocurrencies for their citizens while others talk about adopting some of them. Still, no currency has turned legit that way.
There are two ways to get crypto coins – you could either buy it with investing money or you could start mining it by yourself.
Which one you will choose, depends on your literacy and preferences to deal with different matters.
If you decide to invest your money in buying cryptocurrency one thing is sure – you need to be updated about the markets trends in every few hours.
Let’s see which the market leaders are and what’s a better idea – to buy a crypto coin or to dig and make deals with some other cryptocurrencies.
On the one hand, buying crypto coins is very similar to buying shares at stock exchange – depending on your knowledge you may be able to deal with it by yourself or to outsource it to an expert.
Specifications of this market are that it’s very fluctuating and lacks regulation – everything is based on confidence among users.
Anyone should be ready to become a millionaire with a blink of an eye or lose every invested dollar in seconds.
On the other hand, the truth is that mining is not for everyone.
The process requires specific technical knowledge, and it is necessary to invest time and money to fulfil the idea. See details about how cryptocurrencies function in Cryptocurrency Guide With All the Information You Need
1) Bitcoin
Whatever we say about Bitcoin will not be enough – it has fluctuated in price and investors’ preferences since its creation in 2009 until nowadays.
Still, with all its positives and negatives it remains the best-known cryptocurrency and embodies the brand-new way humans give their trust, and that fact exactly makes it the symbol of a disruptive new way of perceiving and using the money.
Due to its extremely high-rise price bitcoin has turned to be the exclusively famous cryptocurrency which is known all over the world.
At the end of 2017, its value made a significant increase from $1,000 to almost $19,000, which is about 1800 percent.
You need quite a good economics’ consultant to analyse if the price is about to rise or collapse. Meanwhile it might be a good idea to start researching if this idea complies with you.
You might find detailed info here.
Bitcoin has the historical advance of being the first released cryptocurrency and consequently the most preferred and favoured among beginners in the area.
At the same time, one of the features that Bitcoin’s blockchain owns is qualified by alternative currencies (altcoins) as one of its disadvantages.
The network has been settled in such a way that anyone can see the transactions between all the addresses and see each balance, which is not precisely 100% anonymity.
2) Dash
There is a bunch of other cryptocurrencies that also have made their path to worldwide recognition.
Characteristics of Dash:
It is among the most popular altcoins which primary focus is on privacy as well as the transaction speed. Unlike bitcoin, which uses only one mining algorithm, Dash consumes 11 algorithms responsible for the distribution of coins among the miners.
Why would someone prefer it as a part of one’s wallet? Here are some of the advantages of Dash:
The currency provides some precious assets and those put Dash in the Top 10 cryptocurrencies.
It ensures high-level of privacy for transactions and at the same time they are almost immediate.
The combination of these two qualities is a guarantee for the anonymity that Bitcoin does not entirely offer.
Another interesting to mention about Dash is that it can be bought with cash through ATMs in the USA – 3 locations are currently available, and despite high fees, it saves you while making a cryptocurrency wallet.
Mining: Of course, as each cryptocurrency, Dash can also be mined.
However, you should have in mind that you need specific hardware to do it.
It is called ASIC – Application Specific Integrated Chip, and you need to add it to your PC.
These appliances are much more powerful than GPUs (Graphics Processing Units), which every computer owns.
ASIC devices are in the package with an integrated controller that contains the mining software and are easy to configure.
3) Ripple
Ripple used a distributed open source internet protocol and was released in 2012.
It gained immense popularity during last months and at the moment ranks third among cryptocurrencies.
The value of ripple has risen by more than 35,000% during 2017.
Characteristics:
It began turning so much legitimate because some large institutions and banks started using it.
According to Wikipedia info companies such as UniCredit, UBS and Santander adopted the payment network.
Crypto supporters, however, that this development of centralisation does not comply with the idea of cryptocurrencies – which is just the opposite and focuses on decentralisation and it may be described as a particular disadvantage.
Advantages:
Advantages of Ripple are well-known, and that’s why it’s the first that has penetrated into bank transfers and operations.
First and foremost, Ripple settles payments in 4 seconds and can handle about 1,5 000 transactions per second.
Comparison to other popular currencies is in total favour of Ripple:
It is a considerable margin – both from Ethereum – 15 transactions per second and Bitcoin – 3-6 transactions per second.
The other significant factor for preferring Ripple than other cryptocurrencies is that it has a proven stability record since its creation five years ago.
One important mark – Ripple mining is not possible. The company that has created the currency is the only one that creates them.
A quantity of 100 billion Ripple coins have been released – once a coin has been used, it cannot be further used in the next transaction. The only way to have a Ripple is to invest and buy coins from trading platforms.
4) Litecoin
Litecoin resembles Bitcoin, but at the same time, it has two significant advantage features that differentiate it – it has faster confirmation that BitCoin, and it’s also cheaper than the Crypto Coin Number 1.
These features have been appreciated well as in December 2017 Litecoin reached its highest value – $360.
This rise is an unbelievable jump compared to a year ago at the cost of $4.40.
Buying Litecoin looks the same as buying Bitcoin – you may use exchange and a credit or debit card.
The statistic shows that the most prominent part of purchases is made with Bitcoin.
Litecoin mining is also an option.
However, a significant thing should be clear – compared to Bitcoin, Litecoin uses an entirely different “proof of work” algorithm.
The so-called script’s algorithm requires large amounts of memory (RAM), and that means that ASIC hardware might not be that useful compared to GPUs.
The quantity of Litecoin is limited as there will be 84 million Litecoins in total. The number has been based on the 21 million Bitcoin restriction, having in mind that Litecoin was designed to be four times faster. Calculations show that almost 56 million have been released or mined already.
Still, there are nearly 30 million coins for miners.
5) Ethereum
Ethereum has the second largest market share after Bitcoin and together with the impressive rise of Ripple at the beginning of 2018.
In fact, the two altcoins continuously interchange their top spots depending on price.
It has emerged with the growth of 230% in the last year.
Ethereum is an open software platform which uses blockchain technology.
In this way it allows software developers to build decentralised applications (DAPPs).
But what’s the difference then?
While Bitcoin aims to disrupt banking applications, there aims to use blockchain to replace internet third parties which store data. We might say that Bitcoin is focused on digital currency, while Ethereum puts the accent on smart contracts.
These are pieces of code that can be distributed around the network and start working by themselves, by incoming data from the system.
The advantage of Ethereum compared to Bitcoin is that it supports a lot of different types of decentralised applications.
As it supports a different concept about decentralisation at every level, it is entirely different and functions on a larger scale.
The tokens here are named Ethers and developers use them to pay for transaction fees.
Mining is available for Ethers as well as with CPU and GPU improvements. Therefore, you should keep in mind to check in mining calculators will an Ether be enough for electricity and hardware costs.
Unlike the Bitcoin, here hardly half of its coins will have been mined within four years of existence.
Litecoin resembles Bitcoin, but at the same time, it has two significant advantage features that differentiate it – it has faster confirmation that BitCoin, and it’s also cheaper than the Crypto Coin Number 1.
These features have been appreciated well as in December 2017 Litecoin reached its highest value – $360.
This rise is an unbelievable jump compared to a year ago at the cost of $4.40.
Buying Litecoin looks the same as buying Bitcoin – you may use exchange and a credit or debit card.
The statistic shows that the most prominent part of purchases is made with Bitcoin.
Litecoin mining is also an option.
However, a significant thing should be clear – compared to Bitcoin, Litecoin uses an entirely different “proof of work” algorithm.
The so-called script’s algorithm requires large amounts of memory (RAM), and that means that ASIC hardware might not be that useful compared to GPUs.
The quantity of Litecoin is limited as there will be 84 million Litecoins in total. The number has been based on the 21 million Bitcoin restriction, having in mind that Litecoin was designed to be four times faster. Calculations show that almost 56 million have been released or mined already.
Still, there are nearly 30 million coins for miners.
6) Zcash
Characteristics of Zcash: It’s a currency that fulfils the Bitcoin promise to fulfil transactions without revealing the wallet’s balance or details about the involved parties.
As one of the new altcoins it has been highly appreciated and with increasing volume, close to Ethereum concerning price – it was above $400 in June 2017.
Besides the advantage of the privacy and security also comes the fungibility of Zcash – each coin worths the same value as the others issued and are mutually interchangeable.
Similar to Bitcoin the Zcash blocks add an average amount of 50 new coins in every 10 minutes – and the plan is that a total of 21 million coins will be ever created.
The easiest ways to purchase Zcash is using Bitcoin while using any of the widely popular exchanges.
Mining is also an option, with the application of your central processing unit (CPU) or GPU.
You need to adjust it for these actions, and similar to every cryptocurrency mining there is a necessity to choose a wallet and register in a mining pool.
A possible disadvantage might be found in the way Zcash is decentralised.
It has been developed as an open-source project, but it comes from a company with a specific business model.
That affects the way the coins are distributed – from the very beginning there is a Founders’ Reward introduced.
According to this concept, 10% of the tokens are allocated into the Founders’ Reward fund, while the remaining 90% is distributed among the miners.
This decision might be an issue as founders could end up as owners of 10% of the total supply of Zcash.
7) Monero
Monero offers a private digital currency – which is untraceable and secure.
Like other cryptocurrencies, it uses open source and allows everyone to have one’s own money.
Among Monero’s assets is the fungibility of the currency.
Unlike Bitcoin where all transactions are seen and once recorded illegal a Bitcoin stays tainted forever, Moneros transactions are private, and therefore fungible.
Last, but not least, the mining algorithm has been created to help ordinary people to mine cryptocurrency.
Regular computers could mine Monero with their software without adding additional software or hardware solutions.
Willing miners have to download a Monero wallet, and that’s enough.
Being famous as the most private cryptocurrency due to its Ring Signatures, Monero is well positioned on to the markets.
Most of the people worldwide could easily buy it using their credit cards in the exchanges websites, while U.S citizen needs to buy Bitcoins first and then Monero.
Conclusion
Each of these 7 cryptocurrencies has contributed important innovation into the blockchain ecosystem. Their central ideas have been adapted and included into even newer projects such as Cardano ADA – the so called 3rd generation of cryptocurrencies. The evolution of cryptos promises to continue at an accelerated pace and these seven currencies have been leading the field in innovation and market valuation.