The first digital decentralised currency was created in 2008. It was Bitcoin – pee-to-peer payment system created by Satoshi Nakamoto – a developer or a group of many that still remains unknown. Today there are more than 1500 cryptocurrencies. However, there is still a division between Bitcoin and alternative coins, called altcoins. According to Сoinmarketcap, the rate of Bitcoin dominance on the market is over 44% and BTC are the most expensive and attractive coins for a wide range of investors.
The first altcoins appeared back in 2011. The goal was to master Bitcoin technical limitations – slow transactions, lack of anonymity, difficult and expensive mining (especially now) and functional limited only with carrying out transactions.
Bitcoin is usually both conceptually and technically different from other coins. First of all each coin is based on a particular idea and even if this idea is shared by a large number of cryptocurrencies (secure distributed transactions), each currency tries to implement this idea more or less differently. The main advantage of altcoins is the fact that all of them can be used the same way as Bitcoin but at the same time offer something more. This additional functionality is what helps altcoins exist on the market. Apart from making transactions, many of them try to go beyond the cryptocurrency concept and develop platforms where other financial instruments or even any kind of services can be created and operated using the blockchain technology.
Many digital coins are very similar to Bitcoin as they are based on Bitcoin blockchain. These are, for instance, Dash or Litecoin. However, they still have their own unique features – the first currency is in some ways better technically developed and the second one provides faster transactions. Another popular cryptocurrency, Monero, is not based on Bitcoin blockchain and has a special cryptographic protocol. Moreover, Monero is believed to be extra secure and anonymous. Ripple is a payment system focused on exchange operations and integration with the banking sector. Digital currency Dogecoin, named after the famous meme of surprised dog Shiba-inu, is actually a copy of Litecoin, however it provides opportunities to mine coins on user’s PC and is has fast confirmation of blocks.
So, each cryptocurrency aims to offer additional functionality. However, Bitcoin has many advantages, for example – a large number of users and a large transactions volume that are often more valuable than these additional functions. Bitcoin also has perhaps the best liquidity among other cryptocurrencies.
You may ask why there`s nothing here about Ethereum? Well, we believe that ether deserves a special status among other coins, considering its importance for cryptocurrency market and blockchain-economy, and The Coin Shark has already posted an article about that.