Digital currency which is designed to work as the medium of exchange is of many different types, and it has few well-known currencies out of which six are the most famous ones.
Bitcoin is one of the most commonly known cryptocurrency, it is considered as an original cryptocurrency and open-source software which was created in 2009. The pseudonym Satoshi Nakamoto is the author of the whitepaper who established this digital currency.
How does Bitcoin work?
The Bitcoin works by using the blockchain technology, where it allows the users to make transparent peer-to-peer transactions. All its users can view the transactions; but, these transactions are secured through an algorithm within the blockchain network. The user can see the transactions, but only the owner of the Bitcoin can decrypt them with a “private key” which is provided to each owner.
Not similar to the banks, Bitcoin has no central authority figure to monitor or interfere. The Bitcoin users control the transactions of sending and receiving the money, this call for anonymous transactions to take place across the world.
Litecoin which is an alternative to Bitcoin was launched in 2011. Similar to other cryptocurrencies, Litecoin is also an open source. It is a global payment network which is completely decentralized, that means there is no central authority involvement.
The difference between these digital currencies Bitcoin and Litecoin is; Litecoin is believed to have faster transaction times and the coin limit is 21 million for Bitcoin and that for Litecoin is 84 million. Both of them operate on different algorithms, like Litecoin on “scrypt” and Bitcoin on “SHA-256.”
Ethereum is a cryptocurrency which is an open source platform that is based on blockchain technology and is created in 2015. When tracking the ownership of these digital currency transactions, Ethereum blockchain focuses mostly on running the programming code of the decentralized application and allowing it to be used by the developers so as to pay for the transaction fees and services on Ethereum network.
Ripple which acts as both a cryptocurrency and digital payment network for the financial transactions was released in 2012. It is a global settlement network which is designed to create a fast, low-cost and secure method of transferring money.
Ripple allows its users for any type of currency to be exchanged, be it from USD and Bitcoin to the gold and also it connects to banks, unlike the other cryptocurrencies. Ripple is also different from other digital currencies because it primary focus is not for peer-to-peer transactions, but rather for moving the sums of money on a larger scale basis.
Bitcoin Cash is another type of digital currency which was created to improve particular features of Bitcoin. Bitcoin Cash increased the features like size of blocks and allowing more transactions to be processed faster and easier.
Ethereum Classic is the next version of Ethereum blockchain. It also runs smart contracts on a similar decentralized platform like Ethereum. The Smart contracts are applications which run exactly as the programmed ones without any possibility of downtime, fraud, censorship or third-party interface. Similar to Ethereum, it provides token called “classic ether,” which can be used to pay the users for services and products.
In the following infographic, we discuss about the top 33 cryptocurrencies in four words or less, please check out the infographic and let us know your thoughts. This infographic was developed by our friends at Mrbtc.org