Bitcoin’s value has skyrocketed this year, even beyond a gold ounce. There are also new cryptocurrencies on the market, which is even more surprising, bringing the value of cryptocins to over a hundred billion. On the other hand, the longer-term outlook for cryptocurrency is somewhat of a blur. There are arguments over the lack of progress among the main developers, making it less attractive as a long-term investment and a payment system.
Still the most popular, Bitcoin is the cryptocurrency that started it all. It is currently the largest market capitalization of approximately $ 41 billion and has been in existence for 8 years. All over the world, Bitcoin has been widely used and so far it has not been easy to exploit weakness in the method it works. Both as a payment system and as a stored value, Bitcoin allows users to easily receive and send bitcoins. The concept of the blockchain is the basis on which Bitcoin is based. It is necessary to understand the blockchain concept to get an idea of what the cryptocurrencies are about.
Simply put, blockchain is a database distribution that stores every network transaction as a data block called a “block”. Every user has blockchain copies, so when Alice sends 1 bitcoin to Mark, every person on the network knows this.
An alternative to Bitcoin, Litecoin tries to solve many of the problems that hold Bitcoin back. It’s not as resilient as Ethereum with its value derived primarily from the acceptance of solid users. It’s worth noting that Charlie Lee, ex-Googler, leads Litecoin. He also practices transparency with what he does with Litecoin and is quite active on Twitter.
Litecoin has long been Bitcoin’s second fiddle, but things started to change early in 2017. First, Litecoin was adopted by Coinbase along with Ethereum and Bitcoin. Then Litecoin solved the Bitcoin problem by applying Segregated Witness technology. This gave it the opportunity to reduce transaction costs and do more. However, the deciding factor was when Charlie Lee decided to focus exclusively on Litecoin and even left Coinbase, where he was the Engineering Director, only for Litecoin. As a result, Litecoin’s price has risen in recent months, the main factor being that it could be a real alternative to Bitcoin.
Vitalik Buterin, superstar programmer invented Ethereum, which can do everything Bitcoin can do. However, the primary goal is to be a platform to build decentralized applications. The blockchains are where the differences between the two lie. Basically, Bitcoin’s blockchain registers a contract type, one that indicates whether money has moved from one digital address to another. However, there is a significant extension to Ethereum as it has a more advanced language script and a more complex, broader scope.
Projects started to sprout on top of Ethereum when developers noticed its better features. Through token crowd sales, some have even raised millions of dollars and this is an ongoing trend to this day. The fact that you can build beautiful things on the Ethereum platform almost makes it like the internet itself. This made for a sky-high price, so if you were to buy a hundred dollars Ethereum early this year, it wouldn’t be valued at nearly $ 3,000.
Monero strives to solve the problem of anonymous transactions. Even if this currency was seen as a money laundering method, Monero wants to change that. Basically, the difference between Monero and Bitcoin is that Bitcoin has a transparent blockchain with every transaction public and registered. With Bitcoin, everyone can see how and where the money has moved. However, there is somewhat imperfect anonymity on Bitcoin. Monero, on the other hand, has an opaque rather than transparent transaction method. No one is quite sold on this method, but since some people like privacy for whatever purpose, Monero is here to stay.
Unlike Monero, Zcash also strives to solve the problems Bitcoin has. The difference is that Monero is not completely transparent, but is only partially public in its blockchain style. Zcash also wants to solve the problem of anonymous transactions. After all, no one likes to show how much money they actually spent on Star Wars memorabilia. Thus, the conclusion is that this type of cryptocoin really has an audience and a question, although it is difficult to state which cryptocurrency that focuses on privacy will end up on top of the pile.
Also known as a ‘smart token’, Bancor is the new generation standard of cryptocurrencies that can hold more than one token in reserve. In fact, Bancor is trying to make it easy to trade, manage and create tokens by increasing their liquidity level and giving them an automated market price. Currently, Bancor has a front product with a wallet and smart token creation. There are also features in the community such as statistics, profiles and discussions. In summary, the Bancor protocol allows the discovery of a built-in price and a liquidity mechanism for smart contract tokens through an innovative reserve mechanism. With a smart contract, you can immediately liquidate or buy one of the tokens within the Bancor reserve. With Bancor you can easily create new crypto coins. Who would not want that?
EOS, another Ethereum competitor, promises to solve Ethereum’s scaling issue through a suite of tools that are more robust to run and build apps on the platform.
An alternative to Ethereum, Tezos can be upgraded by mutual consent without too much effort. This new blockchain has been decentralized in the sense that it is self-governing through the creation of a digital real commonwealth. It facilitates the mathematical technique called formal verification and has security enhancing properties of the most financially weighted, sensitive smart contract. Definitely a great investment in the coming months.
It is incredibly difficult to predict which Bitcoin will become the next superstar in the list. However, user acceptance has always been an important success factor when it comes to cryptocurrencies. Both Ethereum and Bitcoin have this and even if there is a lot of support from early adopters of every cryptocurrency on the list, some have yet to prove their stamina. Nevertheless, these are the ones to invest in and watch out for in the coming months.