This year the value of Bitcoin has skyrocketed, despite an ounce of gold. There are also new cryptocurrencies on the market, which are even more shocking bringing the value of cryptocoins to over a hundred billion. On the other hand, the longer-term cryptocurrency-outlook is somewhat blurred. There are arguments over the lack of development among core developers that make it less attractive as a long-term investment and as a payment system.
Still the most popular, Bitcoin is the cryptocurrency that started it all. It is now the largest market cap at nearly $ 41 billion and has been in place for the past 8 years. All over the world, Bitcoin is widely used and to date there has been no easy exploitation of the weakness in the way it operates. Both a payment system and as a stored amount, Bitcoin allows users to easily receive and send bitcoins. The blockchain concept is the basis on which Bitcoin is based. You need to understand the concept of blockchain to know what cryptocurrencies are all about.
Simply put, a blockchain is a distribution database that stores every transaction on the network as a data-chunk called a “block.” Every user has blockchain copies so when Alice sends 1 bitcoin to Mark, everyone on the network knows it.
An alternative to Bitcoin, Litecoin has tried to address many of the issues that constrain Bitcoin. It’s not as robust as Ethereum whose value is derived mostly from the adoption of solid users. It should be noted that Charlie Lee, ex-Googler is at the forefront of Litecoin. He also practices transparency in what he does with Litecoin and is quite active on Twitter.
Litecoin was Bitcoin’s second violin for some time but things started to change early in 2017. First, Litecoin was adopted by Coinbase along with Ethereum and Bitcoin. Next, Litecoin fixed the Bitcoin issue by adopting Segregated Witness technology. It provides the capacity to lower transaction fees and do more. The main reason, however, was when Charlie Lee decided to put his full attention on Litecoin and even to leave Coinbase, where he was the Director of Engineering, just for Litecoin. As a result, the price of Litecoin has risen over the past couple of months with its strongest reason being the fact that it could be a real alternative to Bitcoin.
Vitalik Buterin, superstar programmer thinks of Ethereum, which can do everything Bitcoin can. However, its purpose, primarily, is to be a platform for building decentralized applications. Blockchains are the differences between the two. Basically, the Bitcoin blockchain records a type of contract, one that states when funds are transferred from one digital address to another. However, there is a significant expansion of Ethereum because it has a more advanced scripting language and has a more complex, wider range of applications.
Projects started to grow on top of Ethereum when developers started noticing its better qualities. Through token crowd sales, some have even raised millions of dollars and this trend still continues to this day. The fact that you can do great things on the Ethereum platform makes it almost like the internet itself. This is the reason for the price increase so that if you bought a hundred dollars worth of Ethereum earlier this year, it would not be worth nearly $ 3000.
Monero aims to solve the issue of anonymous transactions. Even if this money is considered a means of money laundering, Monero seeks to change it. Basically, the difference between Monero and Bitcoin is that Bitcoin has a transparent blockchain with every transaction that is public and recorded. With Bitcoin, anyone can see how and where money is transferred. There are some that aren’t completely unrecognizable to Bitcoin, though. In contrast, Monero has an opaque rather than transparent transaction method. No one is sold this way but because some people love privacy for whatever purpose, Monero is here to stay.
Unlike Monero, Zcash also aims to solve the issues that exist with Bitcoin. The difference is that instead of being completely transparent, Monero is just a public part of the blockchain style. Zcash also aims to solve the problem of anonymous transactions. Honestly, no one loves to show how much they spent on Star Wars memorabilia. Therefore, the conclusion is that this type of cryptocoin has an audience and a need, although it is difficult to pinpoint which cryptocurrency that focuses on privacy will eventually come out on top of the crowd.
Also known as a “smart token,” Bancor is the new generation standard of cryptocurrencies that can hold more than one token reserved. Basically, Bancor tried to make it easy to sell, manage and generate tokens by increasing their level of liquidity and allowing them to price the market automatically. Currently, Bancor has a front-end product that includes a wallet and creates a smart token. There are also community features like stats, profiles and discussions. In short, the Bancor protocol allows the discovery of an established price as well as a mechanism for liquidity for smart contractual tokens through an innovative reserve mechanism. Through an intelligent contract, you can immediately liquidate or purchase any tokens within Bancor’s reserve. With Bancor, you can create new cryptocoins quickly. Now who doesn’t want that?
Another competitor to Ethereum, EOS promises to solve the issue of scaling Ethereum by providing a set of tools that are more robust to run and create apps on the platform.
An alternative to Ethereum, Tezos can be upgraded without much effort. This new blockchain is rather decentralized in the sense that it governs itself by building a digital true commonwealth. It speeds up a mathematical technique called formal verification and has security-enhancing features in the most financially balanced, sensitive smart contract. Definitely a great investment in the coming months.
It is very difficult to predict which Bitcoin on the list will be the next superstar. However, user adoption has always been a key factor in success when it comes to cryptocurrencies. Ethereum and Bitcoin have it and although there is a lot of support from early adopters of every cryptocurrency on the list, others have yet to prove their staying power. However, this is something to invest in and watch out for in the coming months.