This year, the value of bitcoin has risen, even exceeding one gold ounce. New cryptocurrencies are also appearing on the market, which is even more surprising: the value of cryptocurrencies is over one hundred billion. On the other hand, the long-term prospects of cryptocurrencies are somewhat blurred. Among its major developers are quarrels over lack of progress, making it less attractive both as a long-term investment and as a payment system.
Still the most popular, bitcoin is the cryptocurrency with which it all began. It currently has the largest market capitalization – about $ 41 billion and has existed for the past 8 years. Bitcoin is widely used around the world, and so far it has not been easy to use the weakness of the method it works. Both as a payment system and as a stored value, bitcoin allows users to easily receive and send bitcoin. The blockchain concept is the foundation on which Bitcoin is based. You need to understand the concept of a blockchain to understand what cryptocurrencies are.
Simply put, a blockchain is a database distribution that stores each network transaction as a block of data called a “block.” Every user has copies of the blockchain, so when Alice sends 1 bitcoin to Mark, everyone on the network knows it.
One of the alternatives to bitcoin, Litecoin is trying to solve many of the problems that are holding back bitcoin. It is not as resilient as Ethereum, its value is mainly due to the acceptance of solid users. It should be noted that Charlie Lee, a former Google employee, leads Litecoin. He also practices transparency of what he does with Litecoin, and is quite active on Twitter.
Litecoin has been Bitcoin’s second violin for quite some time, but things started to change in early 2017. First, Litecoin was adopted by Coinbase along with Ethereum and Bitcoin. Litecoin further fixed the problem with bitcoins by adopting Segregated Witness technology. This gave him the opportunity to lower the transaction fee and do more. The deciding factor, however, was that Charlie Lee decided to focus exclusively on Litecoin and even left Coinbase, where he was the engineering director, only for Litecoin. Because of this, the price of Litecoin has risen over the last couple of months, with the strongest factor being that it could become a true alternative to Bitcoin.
Vitalik Buterin, a superstar programmer, came up with Ethereum, which can do everything Bitcoin can do. However, its goal is primarily to be a platform for building decentralized applications. In blockchains there are differences between them. Basically, the Bitcoin blockchain records the type of contract that states whether funds have been transferred from one digital address to another. However, Ethereum has a significant extension as it has a more advanced language script and has a more complex and broad scope.
Projects began to sprout on top of Ethereum when developers began to notice its best qualities. With the help of crowd tokens some have even raised millions of dollars and this is still maintained to this day. The fact that you can create great things on the Ethereum platform makes it almost like the Internet itself. This has led to a rapid rise in prices, so if you purchased Ethereum for $ 100 earlier this year, it won’t be priced at nearly $ 3,000.
Monero is committed to solving the problem of anonymous transactions. Even though this currency was perceived as a way of money laundering, Monero is trying to change that. In essence, the difference between Monero and Bitcoin is that Bitcoin has a transparent blockchain in which every transaction is open and recorded. With Bitcoin, everyone can see how and where money moved. However, there is some imperfect anonymity in bitcoins. In contrast, Monero has an opaque transaction method rather than a transparent one. No one sells this method, but since some people love privacy for any purpose, Monero is here to stay.
Unlike Monero, Zcash also aims to solve the problems that exist in Bitcoin. The difference is that Monero is not completely transparent, but only partially public in its blockchain style. Zcash also aims to address the issue of anonymous transactions. After all, not everyone likes to show how much money they actually spent on memorabilia under Star Wars. Thus, it can be concluded that this type of cryptocurrency does have an audience and demand, although it is difficult to say which cryptocurrency that focuses on privacy will end up in the first place.
Also known as the “smart token”, Bancor is a standard new generation cryptocurrency that can store more than one token in reserve. Basically, Bancor is trying to make it easier to trade, manage and create tokens by increasing their liquidity and allowing them an automated market value. At the moment, Bancor has a product on the interface that includes a wallet and a smart token creation. The community also has features such as statistics, profiles and discussions. In a nutshell, the Bancor protocol allows you to detect embedded account as well as liquidity mechanism for smart contract tokens through the innovation reserve mechanism. With a smart contract you can instantly eliminate or purchase any of the tokens in the Bancor reserve. With Bancor you can easily create new cryptocurrencies. Now who wouldn’t want that?
Another Ethereum competitor, EOS, promises to solve the problem of scaling Ethereum by providing a set of tools that are more reliable for running and building applications on the platform.
An alternative to Ethereum, Tezos can be upgraded by consent without much effort. This new blockchain is decentralized in the sense that it is self-governing through the creation of a digital true community. It facilitates a mathematical technique called formal verification, and has the features of enhancing the security of the most financially sound, sensitive smart contract. Definitely a big investment in the coming months.
It is incredibly difficult to predict which bitcoin will be the next superstar on the list. However, user acceptance has always been a key success factor when it comes to cryptocurrencies. Both Ethereum and Bitcoin have this, and even if there is great support from the first users of each cryptocurrency on the list, some still need to prove their resilience. However, these are the ones that need to be invested in and monitored in the coming months.