The total market capitalization of cryptocurrencies is growing rapidly, recently exceeding more than $ 800 billion and reaching a record high – with an increase of more than 850 percent since the beginning of the year. When most people think of cryptocurrencies, they think of Bitcoin, which was first on the market and is the current leader. But it’s not the only game in the city. There are approximately 1,100 different cryptocurrencies so far. Not sure what is the best? View this list of top cryptocurrencies for more information about each, how cryptocurrency works and where you can buy cryptocurrency.
Bitcoin is the oldest cryptocurrency and the first on the market and therefore has that first-mover advantage. This digital currency is widely accepted and used in many real-world transactions, with a current stock of 16.5 million. Recently, Bitcoin’s value reached a record high of more than $ 20.00.
The transactions are verified by network nodes and recorded on a ledger, with the idea of offering optimum transparency. Anyone can view the peer-to-peer network and view the entire history of a coin; however, discovering the users of those transactions is more elusive.
The process of verifying transactions is completed by miners and is known as cryptocurrency mining. Although you could hypothetically use your hardware with lower power to mine, the more expensive and robust ASIC technology is widely used; other forms of technology are unprofitable for mining.
Miners receive rewards for their work, with those rewards halving every 210,000 mined blocks. Initially, for example, miners received 50 bitcoins, but that number halved to 25 and more recently to 12.5. There is a preset number of bitcoins that can be generated, that is 21 million.
It comes down to. Bitcoins are generally accepted, but some say the transaction costs are high compared to other options. Start by deciding what you will use the currency for. If many transactions take place, it may be cheaper to use another option.
Ethereum is more than a peer-to-peer currency created by Vitalik Buterin; it works as an infrastructure. The technology launched in 2015 with the first ether offer, the Ethereum altcoin, raised $ 18.5 million. The centralized platform offers cryptocurrency, but it also enables the blockchain to develop a variety of applications such as contracts and crowdsourcing.
The average block time of Ethereum is much faster than that of Bitcoin, with Bitcoin running for around 10 minutes and Ethereum with a clock speed of around 12 seconds. The costs for transactions on Ethereum are also different, with Ethereum calculating the costs based on a term called gas. The amount of gas required for a transaction depends on the storage needs. Bitcoin transactions, on the other hand, are limited based on the block size.
It comes down to. If you need more functionality than a traditional cryptocurrency can offer – such as contracts or crowdsourcing – Ethereum can be a good fit.
Ripple was launched in 2012 and is based on a distributed ledger. All transactions pass through nodes and validators, which is similar to the Bitcoin system. Ripple, however, has a high level of governance compared to alternatives such as Bitcoin. There is a concession ledger that depends on specific validators, which are facilitated by global banks and other institutions.
Ripple also offers a fast settlement speed. The consensus mechanism, used by the Ripple Consensus Ledger, controls transactions within seconds, which is much faster than many alternatives. The main advantage of Ripple is that it is accepted by everyone on the Ripple network and that there are no additional trade or transfer costs on the coins.
Obtaining Ripple can only be achieved through the purchase or currency of scholarships. There is no option to get XRP (the Ripple altcoin) through mining, which makes it different from the types of cryptocurrency we discussed above.
What it comes down to is Ripple is not the right choice if you want to mine in the mining industry. But it can offer a solid method to trade cryptocurrency at a fraction of the cost of Bitcoin.
Litecoin is built to be technically similar to Bitcoin; however, the founder, Charlie Lee, designed it with a few important differences. One of those differences is that the block generates time that runs at 2.5 minutes. He also increased the maximum number of coins in the system.
Transaction costs are minimal, and the cryptocurrency uses the scrypt algorithm, which favours large amounts of high-speed RAM, rather than processing power, during the mining process.
Litecoin can process a large number of transactions due to the rapid generation of blocks, so a trader who needs double confirmation can process the transaction faster than with the Bitcoin system.
It comes down to. Litecoin is similar to Bitcoin in many respects, but it varies in speed and transaction costs. If you are planning a large number of transactions, this is a good option.
Dash, formerly known as Darkcoin and Xcoin, is an open-source peer-to-peer cryptocurrency with the goal of being more user-friendly than other options. Dash has created master nodes that encourage users to secure the network and help with user-friendly features, such as instant, which significantly speed up the processing time of transactions.
Operators have to invest 1,000 dash to host a master node, but they get 45 percent of the reward for every Dash block that is mined. Operators receive approximately 7 dash per month.
The cryptocurrency also offers PrivateSend, which provides a more secure method for executing transactions. Although many believe that Bitcoin transactions are private, there is a concern that with sufficient research, transactions can be traced to their owners. PrivateSend, on the other hand, guarantees users complete privacy of their transactions.
Dash also implements governance differently than other altcoins. Each master node receives one vote and the Dash blockchain is financed by itself. Part of each block reward (10 percent) is returned to the network development and promotion budget, which means that developers receive payment for completed work. Moreover, since there are voting rights, decisions can be made faster than with other cryptocurrencies.
It comes down to. If you are concerned about the privacy of your transactions, Dash is a good option. Having access to PrivateSend ensures that transactions are not only anonymous but truly private.
NEM was created in March 2015 and introduced new functions in blockchain technology, including proof of importance. It also introduced accounts with multiple signatures and encrypted messages.
The blockchain has been tested by financial institutions and private organizations in Japan and internationally. In 2016, Tech Bureau, which is the operator of one of Japan’s largest cryptocurrency exchanges, created in collaboration with NEM. They wrote:
“NEM is popular thanks to the strong support of the Zaif exchange, one of the largest exchanges in Japan, together with bitFlyer and Coincheck. NEM’s own blockchain solution, developed by Zaif with the core developers of NEM, is called MIJIN and has established itself as a strong brand in the crypto space in Japan. “
NEM is not just a cryptocurrency – it provides management for a variety of assets, including currencies, supply chains, property registers and more, as a means to implement blockchain solutions faster.
It comes down to. If you want more than just a cryptocurrency, but you also need an infrastructure to build that next mobile app or to bring the blockchain into your existing infrastructure, then NEM is a good option.
IOTA is interesting because it is a cryptocurrency that focuses on delivering communication and payments between machines and the internet of things. The technology was founded in 2015 by David Sønstebø and started testing in 2016.
The technology uses a focused acyclic graph instead of the traditional blockchain. What’s interesting is that unlike other cryptocurrencies, such as Bitcoin, which may have high transaction costs, IOTA transactions are free – regardless of the transaction size. Confirmation times are fast and the system is designed to handle a large number of transactions with great speed.
Most blockchains rely on miners to confirm transactions, but IOTA has no mining, no blocks – and no transaction costs. Users of the network validate two older transactions with a work permit to be able to execute one. No rewards are given and no one pays transaction costs.
It comes down to. If you want to execute transactions but do not want to pay costs, IOTA is a good option. The option is not good if you are interested in dabbling in mining; however, the process of verifying transactions to earn transactions is a good way to get started.
Monero was established in April 2015 and has a strong focus on security and anonymity. While using Bitcoin, developers noticed that privacy was missing. With other cryptocurrencies, it is said that transactions are anonymous, but real privacy does not exist. Monero is made to solve that problem.
The cryptocurrency is made to protect the sending and receiving parties during a transaction. It uses ring signatures that hide the identity of all parties by combining account keys with public keys received from the Monero blockchain.
Just like Bitcoin, Monero miners receive a reward for their work. Monero mining offers a permanent block reward, which means that the value of the reward does not change over time. A consistent reward means that if miners invest in technology today, the reward remains consistent in the future.
It comes down to. If privacy is a big issue, Monero is another option to consider. This allows you to protect the identity of both the sender and recipient during transactions. It is also a good option for new miners because entry barriers are low, requiring only a CPU or GPU computing power.
Steem and BitShares maker Dan Larimer is also the creator of EOS technology, which raised $ 150 million in just five days. EOS was released on the Bitfinex stock exchange last spring and the price has risen by 200 percent in the first few hours.
The cryptocurrency appears to be a direct competitor of the leading cryptocurrency market currency Ethereum. The design is made to promise a new blockchain technology with an operating system that is faster and easier to scale than Ethereum and that makes it easier for users to create decentralized applications.
Unlike other currencies, there is no pre-mine for tokens and in fact, there will be no cryptocurrency mining at all. The target number of EOS tokens will be 1 billion, with a potential of a maximum of 5 percent inflation per year.
EOS is also the first blockchain with a constitution. There are prevailing principles that every stakeholder agrees with, and the set of rules is attached to every block being mined. EOS will be able to process millions of transactions per second using horizontal scaling. This is much different than Bitcoin and Ethereum. The current model also allows 5 percent inflation, which can be used to further develop the network. In addition, EOS does not require users to pay for every transaction, which will promote fuel acceptance.
It comes down to. If you need more than a traditional cryptocurrency and need an infrastructure instead, this is a good option. EOS is also a viable option if you want to eliminate transaction costs.
Cryptocurrency for purchasing and mining has evolved rapidly in recent years and many options have attracted worldwide attention. Users like the idea of eliminating third parties, such as governments and banks and dealing directly with colleagues instead. For example, if a bank or company such as PayPal has decided for some reason that your account has been abused, your assets can be frozen immediately without consulting you.
Digital currency puts the power back into the hands of the user and breaks free from centralized and administrative authorities. You own the private and public keys that make up your address – and nobody can take them from you. However, selecting the correct option depends on how you will use it. For some, you have to do crowdsourcing or contracts, and for others, it is purely transactional. By understanding the benefits of each option and adapting the right one to your needs, you can make a better-informed choice. We hope that this list of cryptocurrencies has been informative, view our other blog posts for more information about how cryptocurrency works!