BCGAME - Free 5BTC Daily Bonus!Not only was Bitcoin a trendsetter, ushering in a wave of cryptocurrencies built on a decentralized peer-to-peer network, it also became the de facto standard for cryptocurrencies, inspiring an ever-growing legion of followers and spinoffs.
MAIN ADVANTAGES
- A broadly defined cryptocurrency is currency that takes the form of tokens or “coins” and exists in a distributed, decentralized ledger.
- In addition, the field of cryptocurrencies has expanded dramatically since Bitcoin was launched more than a decade ago, and the next big digital token could be launched tomorrow.
- Bitcoin continues to lead the cryptocurrency suite in terms of market capitalization, user base and popularity.
- Other virtual currencies, such as Ethereum, are being used to create decentralized financial systems for those who don't have access to traditional financial products.
- Some altcoins are being endorsed for having newer features than Bitcoin, such as the ability to handle more transactions per second or use different consensus algorithms, as proof of bet.
In this article, we will discuss:
What are cryptocurrencies?
Before we take a closer look at some of these alternatives to Bitcoin, let's go back and briefly examine what we mean by terms like cryptocurrency and altcoin. A cryptocurrency, broadly defined, is virtual or digital money that takes the form of tokens or "coins". Although some cryptocurrencies have ventured into the physical world with credit cards or other projects, the vast majority remain entirely intangible.
Crypto “cryptography” refers to complicated cryptography that allows the creation and processing of digital currencies and their transactions in decentralized systems. Alongside this important “cryptographic” characteristic of these currencies, there is a common commitment to decentralization; Cryptocurrencies are typically developed as code by teams that create issuing mechanisms (often, though not always, through a process called "mining") and other controls.
Cryptocurrencies are almost always designed to be exempt from government manipulation and control, although as they have become more popular, this fundamental aspect of the industry has come under fire. Coins modeled after Bitcoin are collectively called altcoins and, in some cases, “shitcoins”, and often attempt to present themselves as modified or enhanced versions of Bitcoin. While some of these coins may have some impressive features that Bitcoin doesn't have, the correspondence with the level of security that Bitcoin networks achieve largely still needs to be seen by an altcoin.
Below, we'll look at some of the most important digital currencies besides Bitcoin. But first, a warning: it is impossible for a list like this to be all-inclusive. One reason for this is the fact that there were more than 4.000 cryptocurrencies as of January 2021. While many of these cryptocurrencies have little or no following or turnover, some enjoy immense popularity among dedicated communities of sponsors and investors.
Furthermore, the field of cryptocurrencies is always expanding, and the next big digital token could be released tomorrow. While Bitcoin is widely seen as a pioneer in the cryptocurrency world, analysts take many approaches to valuing tokens other than BTC. It is common, for example, for analysts to attach great importance to the ranking of currencies against each other in terms of market capitalization. We took that into account, but there are other reasons why a digital token might also be included in the list.
Ethereum (ETH)
The first Bitcoin alternative on our list, Ethereum is a decentralized software platform that allows smart contracts and decentralized applications (dapps) to be built and run without any downtime, fraud, third-party control or interference. The goal behind Ethereum is to create a decentralized set of financial products that anyone in the world can access for free, regardless of nationality, ethnicity or religion. This aspect makes the implications for those in some countries more compelling, as those without state infrastructure and identification may have access to bank accounts, loans, insurance or a range of other financial products.
Applications on Ethereum run on ether, its platform-specific cryptographic token. Ether is like a vehicle to move on the Ethereum platform and is primarily sought after by developers looking to develop and run applications within Ethereum, or now, by investors looking to make purchases of other digital currencies using ether. Ether, launched in 2015, is currently the second largest digital currency by market capitalization after Bitcoin, although it lags behind the dominant cryptocurrency by a significant margin. As of January 2021, the market capitalization of ether is approximately 19% the size of Bitcoin.
In 2014, Ethereum launched an ether pre-order, which received an overwhelming response; this helped usher in the initial currency supply (ICO) era. According to Ethereum, it can be used to “encode, decentralize, protect and market just about anything”. After the attack on the decentralized autonomous organization (DAO) in 2016, Ethereum was split into Ethereum (ETH) and Ethereum Classic (ETC). As of January 2021, Ethereum (ETH) had a market capitalization of $138,3 billion and a token value of $1.218,59.
In 2021, Ethereum plans to change its consensus algorithm from proof of work to proof of wager. This change will allow Ethereum's network to run with much less power and improved transaction speed. Proof of betting allows network participants to “stake” their ether into the network. This process helps to secure the network and process the transactions that take place. Those who do this are rewarded ether, similar to an interest account. This is an alternative to Bitcoin's proof-of-work mechanism, where miners are rewarded with more Bitcoins for processing transactions.
Litecoin (LTC)
O Litecoin , launched in 2011, was one of the first cryptocurrencies to follow in Bitcoin's footsteps and is often called “Bitcoin's silver with gold”. It was created by Charlie Lee, an MIT graduate and former Google engineer.
Litecoin is based on an open source global payment network that is not controlled by any central authority and uses “scrypt” as proof of work, which can be decoded with the help of consumer-oriented CPUs. Although Litecoin is similar to Bitcoin in many respects, it has a faster block generation rate and therefore offers a faster transaction commit time. In addition to developers, there are a growing number of merchants who accept Litecoin. As of January 2021, Litecoin had a market capitalization of $10,1 billion and a token value of $153,88, making it the sixth largest cryptocurrency in the world.
Cardano (ADA)
Cardano is a “Ouroboros proof of bet” cryptocurrency that was created with a research-based approach by engineers, mathematicians and cryptography experts. The project was co-founded by Charles Hoskinson, one of the first five founding members of Ethereum. After having some disagreements with the direction Ethereum was going, he left and later helped to create Cardano.
The team behind Cardano created its blockchain through extensive experimentation and peer-reviewed research. The researchers behind the project have written more than 90 articles on blockchain technology across a variety of topics. This research is the backbone of Cardano.
Due to this rigorous process, Cardano seems to stand out among his proven peers, as well as other major cryptocurrencies. Cardano has also been dubbed the “Ethereum killer”, as his blockchain is capable of more. That said, Cardano is still in its early stages. Although it has surpassed Ethereum in the consensus model of proof of interest, there is still a long way to go in terms of decentralized financial investments.
Cardano aims to be the world's financial operating system, establishing decentralized financial products similar to Ethereum, as well as providing solutions for chain interoperability, election fraud and legal contract tracking, among other things. As of January 2021, Cardano had a market capitalization of $9,8 billion and an ADA traded at $0,31.
Polka dots (DOT)
Polkadot is a unique betting proof cryptocurrency that aims to provide interoperability between other blockchains. Its protocol is designed to connect allowed and unauthorized blockchains, as well as oracles, to allow systems to work together under one roof.
The main component of Polkadot is its relay chain, which allows for the interoperability of multiple networks. It also allows for “parachains” or parallel blockchains with their own native tokens for specific use cases.
What makes Polkadot different from Ethereum is that instead of just creating decentralized apps on Polkadot, developers can create their own blockchain and, at the same time, use the security that the Polkadot chain already has. With Ethereum, developers can create new blockchains, but they need to create their own security measures, which can leave new and smaller projects open to attack, because the bigger a blockchain, the more security it has. This concept in Polkadot is known as shared security.
Polkadot was created by Gavin Wood, another member of the founders of the Ethereum project, who had differing views on the future of the project. In January 2021, Polkadot had a market capitalization of $ 11,2 billion and a DOT was traded for $ 12,54.
Bitcoin Cash (BCH)
Bitcoin Cash (BCH) holds an important place in altcoin history because it is one of the first and most successful hard forks of the original Bitcoin. In the world of cryptocurrency, a fork takes place as a result of debates and discussions between developers and miners. Due to the decentralized nature of digital currencies, wholesale changes to the code underlying the token or coin in question must be made due to general consensus; the mechanism for this process varies depending on the specific cryptocurrency.
When different factions cannot agree, sometimes the digital currency is split, with the original chain remaining true to its original code and the new chain beginning life as a new version of the previous currency, complete with changes to its code.
BCH started its life in August 2017 as a result of one of these splits. The debate that led to the creation of the BCH had to do with the issue of scalability; the Bitcoin network has a block size limit: one megabyte (MB). BCH increases the block size from one MB to eight MBs, with the idea that larger blocks can contain more transactions within them and therefore the transaction speed would be increased. It also makes other changes, including removing the Segregated Witness protocol that impacts block space. As of January 2021, BCH had a market capitalization of $8,9 billion and a token value of $513,45.
Stellar (XLM)
Stellar is an open blockchain network designed to provide enterprise solutions connecting financial institutions for the purpose of large transactions. Huge transactions between banks and investment firms – typically taking several days, involving multiple intermediaries and costing a lot of money – can now be done almost instantly without intermediaries and cost little or nothing to those who make the transaction.
Although Stellar has positioned itself as a corporate blockchain for institutional transactions, it is still an open blockchain that can be used by anyone. The system allows international transactions between any currencies. Stellar's native currency is Lumens (XLM). The network requires users to have Lumens in order to make transactions on the network.
Stellar was founded by Jed McCaleb, a founding member of Ripple Labs and developer of the Ripple protocol. He eventually left his position with Ripple and was a co-founder of the Stellar Development Foundation. Stellar Lumens has a market capitalization of $6,1 billion and is valued at $0,27 as of January 2021.
chainlink
Chainlink is a decentralized oracle network that bridges the gap between smart contracts, like Ethereum's, and data outside of it. Blockchains themselves do not have the ability to connect to external applications reliably. Chainlink's decentralized oracles allow smart contracts to communicate with external data so that contracts can be executed based on data to which Ethereum cannot connect.
Chainlink's blog details a number of use cases for their system. One of the many use cases explained would be to monitor the water supply for pollution or illegal siphoning occurring in certain cities. Sensors can be configured to monitor corporate consumption, groundwater and local water body levels. A Chainlink Oracle could track this data and feed it directly into a smart contract. The smart contract could be set up to enforce fines, release flood warnings for cities, or bill companies that use a lot of a city's water with data coming from the oracle.
Chainlink was developed by Sergey Nazarov together with Steve Ellis. As of January 2021, Chainlink's market capitalization is $8,6 billion and a LINK it was valued at $21,53.
Binance Currency (BNB)
Binance Coin is a utility cryptocurrency that operates as a payment method for fees associated with trading on the Binance Exchange. Those who use the token as a means of payment for the exchange can trade at a discount. The Binance Coin blockchain is also the platform on which the Binance decentralized exchange operates. The Binance exchange was founded by Changpeng Zhao and is one of the most used exchanges in the world based on trading volumes.
Binance Coin was initially an ERC-20 token that operated on the Ethereum blockchain. Eventually, it had its own mainnet launch. The network uses a consensus model of proof of interest. In January 2021, Binance had a market capitalization of $ 6,8 billion, with a BNB with a value of $ 44,26.
Tether (USDT)
Tether was one of the first and most popular of a group of so-called stablecoins, cryptocurrencies that aim to peg their market value to a currency or other external reference point to reduce volatility. As most digital currencies, even major ones like Bitcoin, have experienced frequent periods of dramatic volatility, Tether and other fixed currencies try to smooth out price fluctuations to appeal to users who might otherwise be wary. The price of Tether is directly linked to the price of the US Dollar. The system allows users to more easily make transfers from other cryptocurrencies to US Dollars in a more timely manner than actually converting to the regular currency.
Launched in 2014, Tether describes itself as “a blockchain-enabled platform designed to make it easy to use fiat currencies digitally”. Effectively, this cryptocurrency allows individuals to utilize a blockchain network and related technologies for transactions in traditional currencies, minimizing the volatility and complexity often associated with digital currencies. As of January 2021, Tether was the third largest cryptocurrency by market cap, with a total market cap of $24,4 billion and a token value of $1.
Monero (XMR)
Monero is a safe, private and impossible to track currency. This open source cryptocurrency was launched in April 2014 and soon attracted a lot of interest from the crypto community and enthusiasts. The development of this cryptocurrency is based entirely on donations and driven by the community. Monero was launched with a strong focus on decentralization and scalability and allows complete privacy using a special technique called “ring signatures”.
With this technique, a set of cryptographic signatures emerges, including at least one real participant, but the real one cannot be isolated since they all appear valid. Because of exceptional security mechanisms like this, Monero has developed a rather nasty reputation – he's been linked to criminal operations around the world. While this is one of the prime candidates for making criminal transactions anonymously, Monero's inherent privacy is also useful for dissidents from oppressive regimes around the world. As of January 2021, Monero had a market capitalization of $2,8 billion and a token value of $158,37.
