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Cryptocurrencies are designed to function as a medium of exchange without being moderated by a central source. A highly potential product of the digital age, cryptocurrencies operate in decentralized mode with zero involvement of banks, governments, or any other middleman. However, cryptocurrency transactions take place online through various crypto trading platforms. What makes it safe and secure is the way cryptocurrencies are powered by futuristic technologies.
Following the upsurge in bitcoin usage, blockchain technology made it into the most preferred technique list. Blockchain is a digital public ledger where information on each transaction receives a unique identity or hash and is added to the end of the ledger. Owing to its open-sourced nature and end-to-end encryption, blockchain technology is seen as a trailblazer in the cryptocurrency market. As of 2021, there are over 10,000 different types of cryptocurrency in the digital currency market, compared to 1,000 just four years back. The rise in the number of mushrooming cryptocurrencies is related to the ease with which new cryptocurrencies can be created. Generally, cryptocurrencies fall under two categories namely crypto tokens and coins. Further, the crypto coins are divided into altcoins, stablecoins, tokens, etc. In this article, we take you through some of the famous types of cryptocurrency.
Created in 2009, Bitcoin became a house name in the cryptocurrency market in the following years. Bitcoin avails blockchain technology to allow the user to make transparent peer-to-peer transactions. Even though all users can view the transactions, nobody can crack and steal them. The blockchain cells are secured with an algorithm, making it hard for anybody to break them. Only the owner of the bitcoin can decrypt it using the private key provided to them. Every user has their own private key to moderate their bitcoin asset.
Ethereum is the first altcoin that emerged out of bitcoin technology. Functioning in a decentralized software platform, the cryptocurrency enables smart contracts and decentralized applications (dapps) to shield against downtime, interference of third parties, control, and fraud threats. Ethereum aims to develop a decentralized method of financial products that anyone from across the globe can use without concerns about nationality, ethnicity, or faith. This makes users pick the digital currency over other applications produced by state-run or private financial institutions.
Dogecoin is a digital currency that was originally started as a joke. Later, the online community turned it into a cryptocurrency. Featuring a Shibu Inu dog, Dogecoin has emerged as a major source of digital currency like bitcoin. Elon Musk, the CEO of Tesla, is one of the biggest supporters of Dogecoin. Whenever he talks about cryptocurrency on his social media page like Twitter or in SNL talks, the Dogecoin price skyrocketed. By using Dogecoin, consumers can make quick and easy payments, and create many numbers of coins over time.
Walking out of individual profit sessions, Ripple, one of the unique types of cryptocurrency, yields big benefits for large companies and corporations. Unlike many other cryptocurrencies, Ripple is not based on the famous blockchain technology. Digital currency is well-known for its digital payment protocol more than its crypto as it allows companies to transfer huge amounts of money across the globe. One of the advanced features the Ripple platform has is its ability to transfer monies in any form, be it dollars or even Bitcoin, or even others.
Cardano is a digital currency born out of extreme research and analysis by engineers, mathematicians, and crypto experts. Charles Hoskinson, one of the founding members of Ethereum, redirected himself to create Cardano after having a disagreement with the group. Owing to the extensive experimentation and peer-reviewed research, Cardano stands out among its proof-of-stake peers as well as other large cryptocurrencies. Taking after the concepts of Ethereum, Cardano also aims to be on the top list of the financial operating system by establishing decentralized financial products.
The cryptocurrency market is well known for its volatility. Even though crypto investors are well aware of the price swings, most of them are ready to bet big money in the digital currency sphere despite its oscillation. However, as a sign of relief, Tether emerged as a reliable stable coin. Tether is cryptocurrency tied to a fiat cryptocurrency like the US dollar. Although the price spike of Tether is not remarkably high, many crypto investors enjoy other features like skipping the intervention of financial intermediaries.
One more successful cryptocurrency leveraged out of the bitcoin codebase is Zcash. Built on a decentralized blockchain, Zcash was built by scientists at MIT, John Hopkins, and other respected academics and institutions. One of the major features of Zcash is its concealing nature. Users can send, receive, and trade Zcash without disclosing the sender, receiver, or the amount transacted.
