On the shoulders of Bitcoin, other cryptocurrencies flourish.
Cryptocurrencies are springing up like weeds. Potcoin is working to become the trusted digital currency for cannabis transactions. Coinye, a clever play on Kanye West, didn’t make it past its trademark lawsuit. A slew of other cryptocurrencies are fighting to position themselves in a bountiful market.
Cryptocurrency is a subcategory of virtual currency that has gained staggering attention in 2017, although people’s understanding of how it works may still be lacking. It’s a digital asset that can be transferred from one entity to another using a decentralized digital network. The appeal is users may transfer funds amongst themselves without a third party or bank overseeing, regulating, or even taxing the transaction.
The most valuable cryptocurrency, by far, is Bitcoin. By the end of 2017, its stock price rose over 1,300 percent. At the time of this article, its stock price hovered around $15,085 per share—not bad considering Bitcoin began trading at about $13 a share in 2013.
The ubiquity and success of Bitcoin now makes it ideal for other cryptocurrencies to gain traction. Each offers a different value proposition for the market, meaning their appeal could be as wide-reaching as the market it’s used in. Here are a few cryptocurrencies that aim to nip at the heels of Bitcoin in 2018.
In 2011, Charlie Lee created Litecoin– a cryptocurrency that has a shorter blockchain generation time– thus making it quicker for people to complete transfers. Bitcoin takes about 10 minutes to complete a transfer, while Litecoin transfers are about two and a half minutes. Lees hope is that people will use Litecoin as an everyday spending currency due to the relatively fast transaction time. Many people agree with Lee’s concept–Litecoin’s stock price increased by 5239 percent in 2017 and now sits around $245 per share.
Ripple is making a big splash in the digital asset market with a $40.5 billion market cap. In 2012, former Bitcoin developers launched the company in the hopes of meeting an area of the market that was underserved. Ripple operates as a currency exchange and money transfer institution. This means various currencies, including Bitcoin, can be transferred over its network. Banks and financial institutions like UBS, Unicredit and Santander use Ripple to carry out financial transactions on a security-intensive network.
Available on Coinbase, Bitcoin Cash came from a split of ideologies. Bitcoin Cash increased the blockchain ledger size to make transfers quicker and more affordable, but also more centralized. This is an issue for Bitcoin loyalists that value the decentralized nature of cryptocurrency. The idea of Bitcoin Cash is catching on—its stock price rose over 480 percent in 2017.
Etherium hit the market in 2015 with a more robust approach to smart contracts than Bitcoin. Written in bytecode, smart contracts have the power to prevent or allow fund transfers if specified terms are not met. It gives users the availability to crowdfund and crowdsale in a secure way without the need of a third party.
With the exception of Ripple, the above cryptocurrencies can be bought, sold, and researched in Coinbase–a digital currency wallet. Currently, 35 cryptocurrencies are available for people to buy and sell and that number is sure to be volatile as the cryptocurrency market has proven to be so far.