4 Types of Cryptocurrencies (That Aren’t Bitcoin), Explained

Celsius Network

If you are new to cryptocurrency, it can be tough to understand the differences between all of the thousands of different coins and tokens available. Since our launch, we now support 16 different crypto assets, with several more planned for the near future. To help our community better understand some of the assets that we support, we’re going to do a brief overview today comparing the different assets that are supported by Celsius. Just remember that not all crypto assets were designed to be used as currency — we will talk more about that in the article below.

Dash

Dash is a cryptocurrency that has been available for several years now. Competing with other cryptocurrencies like Bitcoin and Litecoin, Dash boasts a number of technological advantages that make it attractive to a wide audience.

Dash offers extremely fast transactions for comparatively low transaction fees. It also supports a few other high-tech features such as optional private transactions. That means users can choose to send Dash anonymously and in an untraceable manner. Another currency Celsius supports, Zcash, offers similar privacy features.

Dash also offers near instantaneous transactions through a technique known as InstantSend.

For those looking to invest in cryptocurrency, Dash offers a very interesting option in masternodes. Masternodes allow anyone holding at least 1000 units of Dash to run a specialized network node that regularly earns rewards paid in Dash. This method of consensus is known as “Proof-of-Stake” and is an alternative to cryptocurrency mining, which yields rewards through “Proof-of-Work” consensus. The advantage here is that running a masternode does not require expensive or energy-hungry mining equipment.

You can learn more about Dash at their official website, Dash.org.

Ethereum

Created by blockchain superstar Vitalik Buterin, Ethereum is a network that is designed to run distributed applications (like Celsius) on top of it. It can be thought of as an operating system in the same vein as Microsoft Windows or Apple OS X, except that it exists across the entire Internet and is accessible by anyone. Its biggest contribution to blockchain technology was the introduction of Smart Contracts, which allows for the transfer of credible information beyond monetary transactions without the need for third parties.

Ethereum applications pay the network for resources (like computing power) using the network’s native currency, Ether or ETH. ETH can be thought of as a utility coin, as it was not specifically designed to be used as a currency (although it can be).

A huge number of projects and tokens operate on the Ethereum blockchain, making it the single most popular platform of its type. As all applications that run on the network require ether, the coin is regularly in demand. Not only applications, but individuals that want to send Ethereum based tokens (such as CEL) need to pay the transaction fee in ether.

Want to know more? Check out the official Ethereum Foundation website, ethereum.org.

Stablecoins

Celsius currently supports several “stablecoins”, namely US Dollar Coin by Coinbase, Gemini Dollar, Tether USDT, Paxos Standard Token, and Dai. Each one of these is a little different in how they work behind-the-scenes. However, to users like us, they’ll perform in roughly the same way.

One issue people have with Bitcoin and other cryptocurrencies is that prices are constantly changing — and are therefore unpredictable. As a consequence, spending them can be difficult. Stablecoins offer an alternative to this by having their value pegged or tied to a national currency or other basket of stable assets. In the case of our offerings, our stable coins are all connected to the US dollar. That means one stablecoin is equal to roughly one US dollar.

Not all stablecoins are pegged to a national currency, however. Some instead are tied to a package of assets that are just as reliable and easy to verify. One popular example is DAI, which has successfully managed to maintain a price of just around one US dollar each while not relying on the US dollar exclusively.

In addition to the stability offered by stablecoins, they are also popular among cryptocurrency traders as they allow traders to lock in profits earned by selling assets at a higher price and converting the proceeds into a stablecoin. This is preferable to cashing out into a fiat currency such as the US dollar as it is far more convenient and does not require any involvement with banks.

As we mentioned above, each stablecoin is quite different in how it's organized and arranged behind-the-scenes. That’s why we recommend before getting involved in stablecoins, you do a little research on the ones you are interested in to make sure that you understand how they work and any potential risks involved in holding them.

It should also be noted that if your personal goal is to buy cryptocurrency at one price and sell it at a later date for a higher price, stablecoins will not be able to do this. However, if you want to have a highly reliable way to store your value in crypto assets and earn a steady return with Celsius, stablecoins could be the perfect choice.

0x

0x is an Ethereum-based utility token that has a lot of promise and has developed great interest amongst the cryptocurrency community.

Today, the only way to buy and sell a large number of crypto assets is to use a cryptocurrency exchange. These are typically highly centralized businesses that earn a profit from each trade that is made. Centralized exchanges have sometimes been the victim of hackers since they collect large amounts of cryptocurrency in one place, making them attractive targets.

0x is a system wherein almost anyone can easily use the 0x infrastructure to create a decentralized exchange that is effectively immune to hackers and other security concerns. Operators of these exchanges need to pay to use the system in 0x tokens. In some cases, users can pay a reduced trading fee through 0x tokens. Operates of exchanges that use 0x can earn a profit through trading fees on their platform.

According to the team behind 0x, the system can eventually be expanded to cover a multitude of exciting features and functions in the future, and it could extend far beyond just crypto to crypto trades.

Discover more facts about 0x at their official website, 0x.org.


As you can see, just this handful of cryptocurrencies and crypto assets can have a large number of differences amongst them. Some are designed to be used directly as a form of money, and others represent utility on a network or platform. It’s important to understand fully what one gets involved in financially, and a solid grasp on the fundamentals of your cryptocurrency project of choice is a great way to start your journey towards making wise decisions for your future.

Which coin or token do you find the most exciting? What assets do you want Celsius to support in the future? Let us know in the comments below!


About Celsius Network

Celsius Network is a democratized interest income and lending platform accessible via a mobile app. Built on the belief that financial services should only do what is in the best interests of the community, Celsius is a modern platform where membership provides access to curated financial services that are not available through traditional financial institutions. Crypto holders can earn interest by transferring their coins to their Celsius Wallet and borrow USD against their crypto collateral at interest rates as low as 4.95% APR.

Download the Celsius Network app and start earning interest on your crypto today ➡️ celsiusnetwork.app.link

Stay Connected!

Follow Celsius Network on Facebook, Twitter, LinkedIn, Reddit, Instagram, and YouTube.

Celsius Network

Written by

A new way to earn, borrow, and pay on the blockchain.

Welcome to a place where words matter. On Medium, smart voices and original ideas take center stage - with no ads in sight. Watch
Follow all the topics you care about, and we’ll deliver the best stories for you to your homepage and inbox. Explore
Get unlimited access to the best stories on Medium — and support writers while you’re at it. Just $5/month. Upgrade