What You Need to Know About Major Cryptocurrencies Besides Bitcoin
2017 was the year that cryptocurrency finally hit the mainstream as the value of bitcoin soared from under $ 1,000 to nearly $ 20,000, and it doesn’t look like it will slow down in 2018.
If you feel like you’ve missed your chance to be # 1 with Bitcoin, there are tons of other digital currencies to choose from. Here’s a quick guide to some of the other cryptocurrencies that thrived in 2017 but still cost a lot less than Bitcoin.
What is cryptocurrency?
By and large, cryptocurrency is a digital form of money that uses encryption to secure transactions, but there are still a few important details that need to be understood.
First, cryptocurrency can be mined. This involves using a computer to solve increasingly complex equations. These equations are needed to verify transactions, and in return the miner receives currency. Transaction records created in this way are called blocks, which brings us to the second key detail: the blockchain.
A blockchain is essentially a ledger of transactions built from blocks. It is public and decentralized, so any changes are visible to everyone. Blockchain technology was originally created for bitcoin, but has the potential to be used for anything from managing medical records to voting.
So, here are some of the best cryptocurrencies you may have heard of and how they differ from bitcoins.
Bitcoin Cash (BCH)
Bitcoin Cash was created as a result of a Bitcoin fork that happened in August 2017, which resulted in two different currencies being established. The goal was to speed up transactions by increasing the block size for Bitcoin Cash, which also makes scaling easier.
Bitcoin Cash has not replaced Bitcoin, but at the time of writing, it is up slightly at $ 2,788.68 per coin. Popular cryptocurrency exchange Coinbase even added support for Bitcoin Cash in late December, although the move sparked allegations of insider trading and forced the company to temporarily suspend the new feature .
Litecoin (LTC)
Litecoin was created in 2011 by Charlie Lee, an MIT graduate, former Google employee and former CTO of Coinbase. It functions similarly to Bitcoin, but with a larger maximum number of coins that can be mined. Litecoin blocks can also be created faster : one every 2.5 minutes compared to a Bitcoin block every 10 minutes.
Litecoin’s goal is to act as a more economical version of Bitcoin. However, for cryptocurrency speculators, it quickly became another valuable investment. Litecoin is currently priced at just under $ 250.
Ether (ETH)
The Etherium platform and its currency, Ether, were originally proposed in 2013 and released in 2015. It functions similarly to Bitcoin, but with an additional emphasis on smart contracts (agreements enforced by code, not law). They can be used to manage contracts between people, create multi-signature accounts where most need to subscribe before funds can be accessed, and much more.
Bitcoin already includes support for some smart contracts, including those needed to transfer currency between people, but its capabilities are limited. Ethereum allows people to write their own contracts.
The actual currency, ether, functions as fuel to navigate the Etherium platform, but it can also be bought and saved as an investment. It is currently priced at $ 777.55.
Ripple (XRP)
Ripple is the latest cryptocurrency to hit the headlines after its sharp rise in value at the end of 2017. At the end of December, its value reached $ 2.21, which gives a market capitalization of over $ 85 billion.
Created in 2012, Ripple refers to both a company and a cryptocurrency. It is designed to operate as a payment network called RippleNet, which supports Ripple alongside government-backed currencies like the US dollar. The company’s goal is to develop payment technologies for banks and other financial institutions, and more than 100 institutions are already using the network.
Ripple is the only cryptocurrency mentioned in this article that cannot be bought through the popular digital currency exchange Coinbase. However, Ripple’s website lists over a dozen alternative exchanges that support the currency, including Bitstamp , Kraken, and Gatehub.