If you’ve been around these few months, chances are good that you at least have a passing knowledge of what cryptocurrencies are. You may even have heard of names like Bitcoin or maybe Ethereum to name a view. There are many most popular cryptocurrencies which can be used in 2020.
Maybe you’ve heard the terms digital gold or halving if you’ve been listening close enough. More importantly, you may have even heard about how Bitcoin or BTC prices have been hitting record highs these few days.
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So, you may now be asking yourself the question – what exactly are cryptocurrencies?
For starters, cryptocurrencies are essentially digital assets that exist only in the digital realm. They do not exist in a physical form, i.e. paper or coins, unlike fiat currencies. Cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH) are not issued by a single central authority.
Instead, they are entirely decentralized and unregulated – a characteristic that has resulted in the rising popularity of cryptocurrencies. Digital currencies function as a store of value and can be exchanged for goods or services in some instances.
What are the different types of crypto on the market?
To put it simply, there are literally thousands of different cryptocurrencies on the market. However, not all cryptocurrencies have an intrinsic value. Whether through the lack of utility, scarcity or lack of interest, many cryptocurrencies simply end up falling to the wayside.
Others such as Bitcoin or Ethereum end up becoming a part of the mainstream. For example, Bitcoin was first used as a medium of exchange on the deep web before becoming a popular commodity.
Most Popular Cryptocurrencies
Let’s take a look at the various cryptos on the market:
The oldest and arguably most successful cryptocurrency on the market is beyond a shadow of a doubt Bitcoin. Developed by the mysterious Satoshi Nakamoto, Bitcoin first appeared on the scene in 2009.
Entirely unregulated and decentralized, Bitcoin found popularity with deep web users who prized it for the pseudo-anonymity and ease of transfer. Before long, inventors recognized the value of Bitcoin as an investment and began taking an interest.
Fast forward more than a decade after Bitcoin’s inception and the cryptocurrency has become a mainstream investment with even institutional investors taking notice.
The silver to Bitcoin’s gold, Ethereum (ETH) is the second-most popular cryptocurrency on the market today. The Ethereum platform is the most popular blockchain on the market and is used for a variety of applications.
From creating smart contracts to decentralized applications, Ethereum offers users plenty of utility when compared to Bitcoin. Additionally, ether transactions are performed significantly faster when compared to Bitcoin.
With AI and automation becoming the way of the future, Ethereum’s ability to generate smart contracts gives it an edge over other cryptocurrencies.
You can read here what is the difference between Bitcoin and Ethereum.
Ripple or XRP is the native cryptocurrency used to facilitate transactions on RippleNet. Founded in 2012, Ripple Network was developed exclusively to enable customers to easily transfer funds from various points.
Used by various financial institutions, Ripple is a low-cost way to quickly move liquidity on the network. Through Ripple, various financial institutions have been able to improve the quality of the financial services they offer.
Unlike Bitcoin, Ripple (XRP) valuations have remained relatively conservative. However, as Ripple grows in popularity, it is fair to expect prices to appreciate over time.
While Bitcoin offers pseudo-anonymity, Dash (DASH) offers total anonymity for all transactions. An offshoot of Bitcoin, this altcoin was originally known as Darkcoin but has since been rebranded as Dash.
The dash features a significantly higher level of security when compared to other cryptocurrencies and allows for entirely untraceable transactions. Because of this, Dash has a loyal following of enthusiasts who favour the coin.
Investing in cryptocurrencies can be a lucrative trade. However, care should always be practised when choosing the right coins.