This year, the value of bitcoin has jumped, even over one golden ounce. There are also new cryptocurrencies on the market, which is even more surprising as it brings the value of cryptocurrencies up to more than one hundred billion. On the other hand, the long-term outlook for cryptocurrencies is somewhat blurred. There are quarrels due to the lack of progress among its main developers, which makes 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 currently the largest market capitalization of about $ 41 billion and has existed for the past 8 years. Around the world, Bitcoin is widely used and so far it has not been easy to exploit weaknesses in the method it works on. Both as a payment system and as a stored value, Bitcoin allows users to easily receive and send bitcoins. The blockchain concept is the foundation on which Bitcoin is based. It is necessary to understand the concept of blockchain in order to gain insight into what cryptocurrencies are about.
Simply put, a blockchain is a database distribution that stores each network transaction as a piece of data called a “block”. Every user has blockchain copies so when Alice sends 1 bitcoin Mark, every person online knows it.
One alternative to Bitcoin, Litecoin is trying to solve many of the problems that hinder Bitcoin. It’s not quite as resilient as Ethereum with its value stemming mostly from the adoption of solid users. It is worth noting that Charlie Lee, a former Google employee, runs Litecoin. He also practices transparency with what he does with Litecoin and is quite active on Twitter.
Litecoin has been Bitcoin’s second instrument for some time, but things started to change in early 2017. First, Coinbase adopted Litecoin along with Ethereum and Bitcoin. Then, Litecoin solved the Bitcoin problem by adopting Segregated Witness technology. This gave him the capacity to reduce transaction fees and do more. The deciding factor, however, was when Charlie Lee decided to focus exclusively on Litecoin and even left Coinbase, where he was director of engineering, for Litecoin only. As a result, the price of Litecoin has risen in recent months, and its strongest factor is the fact that it could be a real alternative to Bitcoin.
Vitalik Buterin, a superstar developer, designed Ethereum, which can do everything Bitcoin can do. However, its purpose is primarily to be a platform for building decentralized applications. Blockchains are what make the differences between them. Basically, the Bitcoin blockchain records the type of contract, one that states whether funds have been moved from one digital address to another. However, there is a significant expansion with Ethereum because it has a more advanced language script and a more complex, wider range of applications.
Projects began to emerge at the top of Ethereum when developers began to notice its better qualities. Through the mass sale of tokens, some have even raised millions of dollars, a trend that continues to this day. The fact that you can do wonderful things on the Ethereum platform makes it almost like the internet itself. This has caused a dizzying rise in prices, so if you bought Ethereum for $ 100 earlier this year, it wouldn’t be estimated at nearly $ 3,000.
Monero aims to solve the problem of anonymous transactions. Even if this currency is considered a money laundering method, Monero aims to change that. Basically, the difference between Monera and Bitcoin is that Bitcoin has a transparent blockchain with every public and recorded transaction. With Bitcoin, anyone can see how and where money is moved. However, there is some somewhat imperfect anonymity of Bitcoin. In contrast, Monero has an opaque rather than transparent method of transaction. No one is completely sold by this method, but since some people like privacy for any purpose, Monero is here to stay.
Unlike Monera, Zcash also aims to solve the problems that Bitcoin has. The difference is that Monero, instead of being completely transparent, is only partially public in its blockchain style. Zcash also aims to solve the problem of anonymous transactions. After all, no person likes to show how much money they actually spent on Star Wars souvenirs. So, the conclusion is that this type of cryptocurrency really has an audience and demand, although it is difficult to point out which cryptocurrency that focuses on privacy will eventually reach the top of the crowd.
Also known as a “smart token,” Bancor is a standard-generation cryptocurrency standard that can hold more than one token in reserve. Basically, Bancor tries to facilitate the trading, management and creation of tokens by increasing their level of liquidity and allowing them to have an automated market price. At the moment, Bancor has a front-end product that includes a wallet and smart token creation. There are also functions in the community such as statistics, profiles and discussions. In short, the Bancor Protocol enables the discovery of the embedded price as well as the liquidity mechanism for smart contract tokens through the innovation reserve mechanism. Through a smart contract, you can immediately liquidate or buy any of the tokens in the Bancora reserve. With Bancor, you can easily create new cryptocoins. Who wouldn’t want that now?
Another competitor to Ethereum, EOS promises to solve the problem of scaling Ethereum by providing a set of tools that are more robust for running and creating applications on the platform.
An alternative to Ethereum, Tezos can be upgraded by agreement without too much effort. This new blockchain is decentralized in the sense that it is self-governing through the establishment of a digital true Commonwealth. It facilitates a mathematical technique called formal verification and has features that increase the security of the most financially sensitive smart contract. Definitely a great investment in the coming months.
It is incredibly difficult to predict which Bitcoin will become the next superstar on the list. However, user adoption has always been a key success factor when it comes to cryptocurrencies. Both Ethereum and Bitcoin have this, and even if there is strong support from early users of every cryptocurrency on the list, some have yet to prove their endurance. Still, these are the ones to invest in and look out for in the coming months.