By Natalie Lord
The arrival of cryptocurrencies has created a digital world many could never have imagined; a new economy. Whether they’re used as speculation, a store of values, or as a means of payment, these digital cash systems have created a dynamic, fast-paced market for investors and speculators.
Digital exchanges like Kryptos-X, Coinbase, Kraken and Shapeshift enable the trade of hundreds of cryptocurrencies, with their daily volume sometimes exceeding that of major European stock exchanges.
While Bitcoin remains the most-recognised cryptocurrency, it doesn’t stand alone. We take a look at the most popular cryptocurrencies of the moment.
Bitcoin was the world’s first cryptocurrency and remains the most famous one still. It’s the gold standard of the cryptocurrency industry. Bitcoin is used as a global means of payment. It’s been in existence for more than seven years and has seen its price increase from zero to more than US$650. Its transaction volume has hit more than 200,000 daily. If one thing appears certain in this arena of intangibility, it’s that Bitcoin is here to stay.
Bitcoin has a market capitalization of US$63,875,182,171 and as of mid-January was trading at about US$3,652.50.*
Ethereum was the brainchild of crypto-genius Vitalik Buterin, and comes second in the hierarchy of digital currency. Ethereum doesn’t only validate sets of accounts and process transactions, but it also processes complex programs and contracts. This added offering makes Ethereum the perfect instrument for blockchain application. There were variations to the initial Ethereum cryptocurrency, with the emergence of Ethereum Classic. Ethereum is also a host to several tokens like DigixDAO and Augur, which makes it more like a family of cryptocurrencies than a single currency.
Ethereum has a market capitalization of US$12,716,826,746 and as of mid-January was trading at about US$121.76.*
Litecoin came on to the scene soon after Bitcoin, and was considered to be the silver medal, with Bitcoin taking the gold. Litecoin was an innovation to note because it was faster than Bitcoin, with a larger amount of token and a new mining algorithm. Litecoin facilitated the emergence of several other cryptocurrencies which used its codebase like Feathercoin and Dogecoin.
Litecoin has a market capitalization of US$1,883,535,825 and as of mid-January was trading at about US$31.35.*
Monero is the leading example that uses the algorithm cryptonite. The algorithm was invented to incorporate privacy features that Bitcoin didn’t offer. Monero’s algorithm introduced a concept called ring signatures, which shortened the longer process offered by Bitcoin (which necessitates every transaction to be documented in Blockchain).
The popularity of Monero peaked in the summer of 2016 when some darknet markets decided to accept it as a currency. This resulted in a steady increase in the price. The actual usage of Monero, however, remains disappointingly small.
Monero has a market capitalization of US$753,620,333 and as of mid-January was trading at about US$45.05.*
Ripple is perhaps the least popular of the cryptocurrencies and is generally disliked within the crypto community. It has a native cryptocurrency, XRP, and is more about a network to process IOUs than about being a cryptocurrency. The currency XRP doesn’t enable storage and exchange value, but is rather a token to protect the network against spam.
The company running the Ripple network, Ripple Labs, creates every XRP token themselves and it is distributed on will. This is the reason why Ripple is often called pre-mined within the cryptocurrency community, and dismissed as not being a true cryptocurrency, with XRP not considered a good store of value.
That said banks, on the other hand, seem to like Ripple and have been adopting the system with increasing pace. In recent weeks, HSBC Bank and Xoom (which is owned by Paypal) confirmed they are now Ripple clients.
XRP has a market capitalization of US$13,336,256,577 and as of mid-January was trading at about US$0.324954.*
Bitcoin, Ethereum, Litecoin, Monero and Ripple are just a few of the top cryptocurrency contenders. There are hundreds more cryptocurrencies in play and how significant they become in the increasing digital market remains to be seen.
*According to Coinmarketcap on 18 January 2019.