Bitcoin and Bitcoin cash
Bitcoin is a digital currency in the unique payment system of the same name, where there is no controlling body and all participants are equal. Bitcoins can be used to make purchases and transfers if the recipient agrees to receive Bitcoin and is able to do so. The main idea of Bitcoin is full decentralization: there is no central bank, government, or any other administrative entity that can influence or control Bitcoin.
As for Bitcoin's profitability, it is legendary. You can see why: while a Bitcoin was worth $0.003 in the very beginning, was trading in the region of $7000 (as at November 2017).
Needless to say, the ROI is staggering.
Bitcoin Cash is a new currency that arose as the result of a Bitcoin hard fork on August 1, 2017. This is a more scalable replicated block chain of the original Bitcoin with separate blocks that are increased to 8 megabytes.
How the "fork" works is that instead of creating a new block chain starting from zero, the fork simply creates a duplicate of the block chain with the same history.
In actuality, this means that all Bitcoin owners prior to the fork are now owners of the same amount of Bitcoin Cash, since both currencies had the same block chain up until the separation.
At its conception, the currency was worth about $700, but in the following days Bitcoin Cash stabilized in the $250-$300 range.
However, since that time, the new-born Crypto-currency has already won back its positions and has almost returned to initial indicators at about 680 USD per one Bitcoin Cash.
Ethereum is a blockchain-based platform for creating decentralized online services using smart contacts. It is implemented as a single decentralized virtual machine. Developed by 19-year-old Vitalik Buterin, this cryptocurrency collected 18 million dollars in its ICO (initial coin offering) in August 2013 and was launched in July of 2015.
Unlike other crypto-currencies, its creators do not limit the role of the Ether to payments, but offer it, for example, as a means for exchanging resources or registering transactions of assets using smart contracts. In particular, its developers have called the Ether a "crypto fuel" for smart contracts.
The Ethereum technology makes it possible to register any transactions with any assets using a blockchain-type distributed database of contracts, without resorting to traditional legal procedures. This possibility provides competition for the existing transaction registration system. According to The Economist magazine, the technology of smart contracts marks a new era in financial technologies.
In 2017, with an increase of 4000%, Etherium became the second largest cryptocurrency after Bitcoin.
Dash, named for "digital cash," is an open, decentralized payment system that uses a mechanism called Darksend to anonymize transactions.
This currency has been renamed twice, from Darkcoin in 2015 and Xcoin in 2014. It offers all the features of Bitcoin, as well as instant and completely anonymous transactions through so-called Masternodes. Masternodes mix transaction data to erase all of its tracks, and then get a commission on the transaction.
The main differences between Dash and Bitcoin are:
- Transactions in Dash are anonymized;
- Dash uses not one, but multiple cryptographic algorithms in combination;
- Mining Dash consumes less energy;
- Decisions on the further development of the system are made not by individual programmers, but by all members of the Dash network through Decentralized Governance;
The value of this cryptocurrency exceeded the $1 billion mark in May 2017.
The main innovation of IOTA is called Tangle, which basically a network of transactions.
Every new (unconfirmed) transaction is known as a tip. These tips should each reference two previous transactions. The brilliance of the Tangle is that transactions are processed in parallel, and not one after another. If you want to use IOTA, and to send a transaction, you need to confirm two tips before you may send yours.
It is a third-generation Blockchain-technology, based on a directed acyclic graph (DAG), made for the problems of tomorrow.
Let's highlight the list of the most important features of the IOTA:
- No commissions. Instead of commission, you will have to confirm two other transactions.
- No mining. In IOTA, consensus is completely decentralized with each network participant that makes a transaction, directly and indirectly confirming past transactions.
- Offline transactions. Tangle does not have strict requirements, allowing users to join clusters and even make payments using coins in an offline environment.
- Internet of things. This is a fairly interesting concept, meaning a network of physical objects ("things") equipped with built-in technologies to interact with each other or with the external environment. In the future this phenomenon will be capable of completely reconstructing economic and social processes.
Practically the main goal of IOTA is a symbiosis with the Internet of things. Given the potential of these technologies, the price of the IOTA will only grow year on year.
Ripple is a distributed payment system within which the same crypto currency (XRP) is used as an internal payment unit.
Released in 2012, Ripple purports to enable "secure, instant and nearly free global financial transactions of any size with no chargebacks."
The Ripple technology is based on a completely different basis, a so-called "principle of trust".
Simply put, "trusting" an entity in Ripple is saying that you treat their word as a substitute for money.
XRP have similar properties with BTC:
- Ripple is divided to a large number of decimal places after the decimal point;
- It is also easily transmitted in electronic form and has high cryptographic stability;
- Interchangeable and homogeneous;
But also XRP has advantages over BTC:
- Transactions in the network are much faster;
- Ripple has some intrinsic value. Ripple is a private corporation with privately held equity/shares - this is where the intrinsic value of Ripple lies, and not in the XRP token;
- Ripple coins are deflationary, as they are destroyed by the network after the transaction is carried out and the total number of XRPs decreases with time;
As of 2017, Ripple is the fourth crypto currency in terms of market capitalization, second only to Bitcoin and Ethereum.
Litecoin is a peer-to-peer Internet currency, which includes almost zero-cost payments to anywhere in the world.
Litecoin is a result of Bitcoin hard fork, with two cryptocurrencies have been split since 2011. The emission of Litecoin, as in the case of Bitcoin, is algorithmically limited.
The maximum amount of Litecoin that will go into circulation exceeds the maximum number of Bitcoin by 4 times (84 million versus 21).
The initial reward for each block is 50 Litecoin.
Litecoin blocks are formed 4 times faster than Bitcoin blocks. Their pace of emissions and rewards will be similar over time.