Although Bitcoin was the first coin other coins have been created with their own unique selling points. These “alt coins” include Ethereum, Litecoin, Dash and many others. The top 30 coins are very liquid and traded on many exchanges.
The first alt coins appeared in 2011. Their aim was to overcome Bitcoin’s technical limitation . As of the beginning of December 2017, there are over one thousand alt coins.
Coinmarketcap.com portal contains data on 904 altcoins traded on exchanges, although according to some estimations, their number exceeds one thousand. Nevertheless, in the total capitalization of the cryptocurrency market in the amount of more than $343,586 billion, Bitcoin still takes the dominant position.
Disadvantages of Bitcoin
The developers of alt coins primarily solve problems that are present at Bitcoin.
Among such disadvantages there are:
- Long transactions. To speed up the transactions’ time, other algorithms are used. In addition, the cryptocurrencies with a smaller block volume calculate the necessary operations faster.
- Lack of anonymity. Although the cryptocurrency transactions are considered to be encrypted enough, still, the sender and receiver may be tracked. To avoid it, some alt coins use addition methods of encrypting.
- Difficult and expensive mining. Constant complicating of Bitcoin mining requires even more resources to form new blocks in block chain. Altcoins offer alternative mining protocols, which allow the users to do it without any complex equipment.
- Insufficient functionality. Bitcoin is a cryptocurrency and its primary task is to be a tool for settlement transactions. Altcoins add extra functionality, for example, the creation of smart contracts.
Many of altcoins are built on the basic structure, provided by the Bitcoin block chain, i.e., they are in fact its forks. So, the majority of altcoins are single ranked, include mining process and offer effective and cheap ways to carry out transactions over the Internet.
The most popular altcoins
The cryptocurrency, created in the Ethereum block chain. «Ether» is second by capitalization after Bitcoin, as well as has been second by the rate price of one coin for a long time. Ethereum was developed in 2015 as a platform for the creation of smart contracts. Today, the major part of all ICOs are conducted on this platform.
A fork of Bitcoin, released on August 1, 2017. Unlike Bitcoin, it has a block with the size of 8 Mb. It showed a rapid growth in November, as of December one coin costs over $1500.
One of the first altcoins, released in 2011. It has no fundamental differences from Bitcoin. At the same time, transactions in block chain go faster.
The cryptocurrency with an additional level of encryption. It is the most popular payment method in the Darknet, which is why it is often criticized, blamed for serving criminal actions
Another altcoin, aimed at anonymity. Has been existed since January 2014.
A platform for payment systems oriented on currency exchange operations. The Ripple protocol, developed by the company of the same name in 2012, is popular in the banking sector.
Altcoin, serving the block chain, which is targeted on serving transactions in the framework of the Internet of Things.