Into The World Of Cryptocurrencies
By Ghanima on ALTCOIN MAGAZINE
Cryptocurrencies have been out there since 2009 by the launch of Bitcoin, the first-ever cryptocurrency. Fast forward 10 years, According to CoinMarketCap, we currently have around ~2900 cryptocurrencies out there with a market capitalization of over 200 billion dollars. Today I’ll be discussing generally what cryptocurrencies are and what they offer.
There are mainly two types of cryptocurrencies and we’ll summarize the differences between them, The first being coins, coins are standalone currencies which have their own blockchain network with its own miners and nodes. This means that usually, the way to generate new coins is by mining and taking part in solving the network operations to receive a certain amount of the coins as the reward. The second being tokens, tokens are built and hosted on existing blockchains (the first type). Tokens are usually created and distributed to the public through Initial Coin Offering which is a form of crowdfunding. Tokens are not mine-able such as coins as it does not have its own blockchain network.
While there are many cryptocurrencies out there that act as a digital currency, This is not the only goal of them. There are many categories in which we can place different Cryptocurrencies in. The following periodic table was created by investinblockchain.com and shows different cryptocurrencies and how they are categorized into different categories.
There are 9 categories in the periodic table and they are as follows. It provides a unique, easy-to-read way of understanding the cryptocurrency universe.
Currencies
These are coins and tokens which mainly focuses on payments and acting as digital cash or store of value. The most popular currency in this category would be the most famous one, Bitcoin (BTC). Digital transactions are saved on its blockchain ledger.
Privacy Coins
These coins are very similar to the currencies however they are a lot more focused on privacy and anonymity. They allow users to send digital cash to other users without being identified publicly on the blockchain network. The most popular coin in this category is Monero (XMR).
Platforms
These coins are a part of a smart contract network or decentralized application platform. Most popular coin in this category would be Ethereum (ETH) which is a smart contract platform which allows users to execute smart contracts based on events/triggers. Also, Ethereum is the home of many tokens as it allows users to create their own tokens on top of the Ethereum platform.
Protocols, Exchanges, And Interoperability
These are the coins and tokens which focuses on adding to the ecosystem and infrastructure of the crypto world. They’re used to enable different blockchains to communicate and exchange information with each other and to allow users to exchange cryptocurrencies from one form to another.
Computing, Data Management, And Cloud Services
These coins and tokens allow the share of computing power and decentralized storage.
Gaming, Media, And Social Networking Platforms
These coins and tokens are related to the gaming industry, online content publishing and distribution, and social media.
FinTech
These coins and tokens are related to the FinTech industry. The most popular coin under this category would be Ripple (XRP) which allows users to move money around the world instantly with a very small fee.
Business/Enterprise
These coins and tokens help business improve transparency and efficiency and other things.
Others
These coins and tokens have a specific function which can’t be grouped as each offers something different from another.
Bitcoin currently holds most of the market share at 67.7% at the time of writing this article. The crypto universe is still in its initial phase with many interesting projects with huge goals to accomplish. Such as Ethereum, Ethereum allows users to create their own coin offering, which allowed many people to start their own token and collect money to fund their own projects. Hopefully, in the future we can see many of those goals being met. If you have found any of these coins/tokens interesting, you could take a look at their whitepaper to see how they plan to accomplish their goals.
