This year, the value of Bitcoin has skyrocketed, even beyond an ounce of gold. There are also new cryptocurrencies on the market which is even more amazing as it brings the value of cryptocurrencies to over a hundred billion. On the other hand, the long-term outlook for cryptocurrencies is somewhat blurred. There are disputes about the lack of progress among its main developers, which makes it less attractive as a long-term investment and as a payment system.
Bitcoin
Still the most popular, Bitcoin is the cryptocurrency that started it all. It is currently the largest market cap at around $41 billion and has been around for the last 8 years. Around the world, Bitcoin has been widely used, and as of yet, there is no easy-to-exploit weakness in the method in which it works. 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 sits. It is necessary to understand the concept of blockchain to have an idea of what cryptocurrencies are.
In a nutshell, blockchain is a database distribution that stores each network transaction as a piece 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 about it.
litecoin
An alternative to Bitcoin, Litecoin tries to solve many of the problems that hold Bitcoin back. It is not as resilient as Ethereum and its value is mainly derived from strong user adoption. It is worth noting that Charlie Lee, a former Googler, leads Litecoin. He also practices transparency with what he does with Litecoin and is quite active on Twitter.
Litecoin was second fiddle to Bitcoin for quite some time, but things started to change at the beginning of the year 2017. First, Coinbase adopted Litecoin along with Ethereum and Bitcoin. Next, Litecoin solved Bitcoin’s problem by adopting Segregated Witness technology. This gave you the ability to reduce transaction fees and get more done. However, the deciding factor was when Charlie Lee decided to focus solely on Litecoin and even left Coinbase, where he was the Director of Engineering, just for Litecoin. Due to this, the price of Litecoin has increased in recent months, its strongest factor being the fact that it could be a real alternative to Bitcoin.
Ethereal
Vitalik Buterin, superstar programmer, came up with Ethereum, which can do everything Bitcoin can do. However, its purpose, primarily, is to be a platform for building decentralized applications. Blockchains is where the differences between the two lie. Basically, the Bitcoin blockchain records a type of contract, which states whether funds have been moved from one digital address to another address. However, there is significant expansion with Ethereum as it has a more advanced scripting language and has a more complex and wider scope of applications.
Projects began to sprout on top of Ethereum as developers began to notice its best qualities. Through crowd-selling tokens, some have even raised millions of dollars and this continues to be a current trend even to this day. The fact that you can build amazing things on the Ethereum platform makes it almost like the internet. This caused a skyrocketing increase in price, so if you bought a hundred dollars worth of Ethereum earlier this year, it would not be valued at almost $3000.
Monero
Monero aims to solve the problem of anonymous transactions. Even if this coin was perceived as a method of money laundering, Monero aims to change this. Basically, the difference between Monero and Bitcoin is that Bitcoin features a transparent blockchain with every transaction public and recorded. With Bitcoin, anyone can see how and where money has moved. However, there is some imperfect anonymity in Bitcoin. In contrast, Monero has an opaque rather than transparent transaction method. No one is entirely sold on this method, but since some people love privacy for whatever purpose, Monero is here to stay.
zcash
Like Monero, Zcash also aims to solve the problems that Bitcoin has. The difference is that instead of being completely transparent, Monero is only partially public in its blockchain style. Zcash also aims to solve the problem of anonymous transactions. After all, not all people love to show off how much money they spent on Star Wars memorabilia. So the bottom line is that this type of cryptocurrency really does have an audience and a demand, although it is hard to pinpoint which privacy-focused cryptocurrency will eventually rise to the top of the heap.
bank
Also known as “smart token”, Bancor is the new generation cryptocurrency standard that can hold more than one token in reserve. Basically, Bancor tries to make it easier to trade, manage and create 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 the creation of a smart token. There are also community features such as statistics, profiles and discussions. In a nutshell, the Bancor protocol enables built-in price discovery as well as a liquidity mechanism for smart contract tokens through an innovative reserve mechanism. Through a smart contract, you can instantly liquidate or buy any of the tokens within Bancor’s reserve. With Bancor, you can create new cryptocurrencies with ease. Now who wouldn’t want that?
eos
Another Ethereum competitor, EOS, promises to solve Ethereum’s scaling problem by providing a set of tools that are more robust for running and building applications on the platform.
Tezos
An alternative to Ethereum, Tezos can be upgraded consensually without too much effort. This new blockchain is decentralized in the sense that it governs itself by establishing a true digital community. It facilitates the mathematical technique called formal verification and has features that increase the security of the most financially weighted sensitive smart contract. Definitely a great investment in the coming months.
Verdict
It is incredibly difficult to predict which Bitcoin on the list will become the next superstar. 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 a lot of early adopter support for each cryptocurrency on the list, some have yet to prove their staying power. However, these are the ones to invest and keep in mind in the coming months.