The entire history of digital currency stretches way back into the distant mists of memory—a whole five years or so. Yeah, so, it's a new industry, and it's still going through the growing pains that come with that. Here at Coin Pursuit, we're often asked what the most popular types of cryptocurrency are. This article will look at the main movers and shakers in the alternative currency market.
Before we move on to our list, though, we'd like to note the factors that all digital currencies have in common, and are attractive to potential investors. They're all decentralized currencies, meaning they aren't linked directly to any corporation or government. This means they don't carry the interest rates, surcharges or regulations that can make traditional currency more costly. They also afford their users a high degree of anonymity; while digital currency transactions are secure, they don't carry the personal information of either party. This feature is popular among privacy advocates.
With that said, here are the biggest players in cryptocurrency today:
Bitcoin. This is the Big Kahuna of digital currencies right now. Introduced in 2009, they got a head start of over two years before they had any competition on the market—and in that time, they were able to catch the public eye and gain investors. As a result, Bitcoin has the largest investor numbers and the highest worth of any cryptocurrency around. As a matter of fact, other currencies are often referred to “silver” as compared to Bitcoin's “gold” status. As investor activity and currency values level out over time, that could change, of course.
Litecoin. Litecoin was introduced in late 2011, and has performed admirably in keeping up with Bitcoin. Its main attraction to investors is the algorithm it employs in “mining,” or data block analysis. In contrast with Bitcoin's SHA-256 system (which is also used by many other cryptocurrencies), Litecoin uses Scrypt, which is much more energy-efficient and faster. This also results in faster transaction approval times (two-and-a-half minutes average, compared to Bitcoin's ten).
Peercoin. Also known as Peer-to-Peer Coin or PPCoin, this digital currency was released to the public in 2012. Peercoin's claim to fame has to do with how its data blocks are mined by its investors. Most other currencies use what is called “proof of work,” which means if a miner can show they have performed a set amount of work, and accomplished certain criteria, they're awarded a number of coins in return. Peercoin uses that, too, but in tandem with their “proof of stake” system. This is a coin reward based upon the miner's investment in the currency.
Namecoin. This was first introduced in 2011, and its main reason for existence was as an online domain name registry system, designed to block internet censorship. However, since its code is based on that of Bitcoin, it also serves as a cryptocurrency, and has been gaining popularity for that use. Another interesting aspect of Namecoin is that it is “merge-mined” with Bitcoin data blocks. Miners can mine both currencies at the same time, and can earn coin awards divided between them, as well.
Novacoin. Novacoin was introduced in early 2013, and it features an interesting combination of features of other currencies. For example, like Litecoin, Novacoin uses the Scrypt algorithm in mining, making it more user-friendly and more efficient to mine. Novacoin also uses the proof of work and proof of stake mining model that has made Peercoin popular. These make Novacoin an interesting hybrid, and in a short period of time it's attracted a respectable number of investors.
We'd like to note this listing is how things stand right now. Here's what we mean: in the 1920s the field of film animation was dominated by Paul Terry, Pat Sullivan and Winsor McKay. Though their names are almost obscure now, they were household names back then...until a young upstart from Kansas City named Walt Disney came along and turned the industry on its ear. The moral of this story: in a young industry, anything can happen—so stay tuned.
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