Cryptocurrencies; Bitcoin, Litecoin, Ethereum, Ripple and Dogecoin

 

Cryptocurrencies are digital monetary form which is governed by any central authority and these currencies are operated without the involvement of banks or any other middleman. Means it reduces the charges of transfer of money from anywhere to anywhere in the world.  These are secured transactions as these are secured through specialized computer code known as cryptography.

Cryptocurrencies are now hot topic among the world as Bitcoin is on rampage since 6 months- to 1 year. In year 2018 it touched high of nearly 20000 dollars and a Bitcoin and thereafter it corrected to as low of 3200 dollars in December 2018 and now trading at around 56000 dollars a Bitcoin means a rise of approx. 15 times. Apart from Bitcoin the alternative coins has been also rising along with Bitcoins.

There are following alternative coins in the market, we must know when these are gaining momentum and are the future aspects of these coins:-

1.      Bitcoin:- 

It is invented in Year 2008. There are 21 million Bitcoins which can be mined in totality and till date 18.50 million Bitcoins have been mined which means 2.5 million Bitcoins are remaining to be mined. Bitocoin miners get reward for mining when 1^st ever Bitcoin was launched than the reward was given as 50 Bitcoins. In 2012 it is halve to 25 Bitcoins, in 2016 it is again halved to 12.5 Bitcoins. In 2020 miners will get 6.25 Bitcoins for mining of Bitcoins. Rewards will be kept on half every four years until year 2140.

But mining consumes huge power. This involves the heavy computer calculations to verify the transactions.  In February itself it is consuming 121 Terawatt hours a year which is more than whole Argentina, Netherlands and United Arab Emirates. 

Bitcoin is the main rival for government currencies and it is now used by persons for black market transactions, money laundering (as you have heard so many cases of money laundering cases through Bitcoins), and even for tax invasion.

Bitcoin

2.       Ripple:-

It was launched in year 2012. Its symbol is XRP. Like bitcoin XRP is also used for international transactions. Ripple is faster and cheaper alternative to bitcoins as transactions get settled in seconds. In Ripple their infrastructure is centralized and doesn’t utilize the proof of work as in case of bitcoins as consent algorithm was used by bitcoins to process transactions.

Unlike bitcoins ripple are not mined infact these are minted earlier when it was launched and ripple supply was done from total of 100,000,000,000 i.e. 100 billion and as on date 45 billion are under circulation. Ripple transactions are overseen by private company.

Ripple

3.       Ethereum:-

This was launched in year 2015. It is largest most well established open ended decentralized platform. There are following usage of ether coin:-

(i)                  Used for online transactions as in case of other cryptocurrencies

(ii)                It is used on Ethereum network to run the applications.

Ether transactions can be done in seconds as compared to minutes in bitcoins. The average block for etherium is less than Bitcoin i.e. Bitcoin Block is get settled in 10 minutes ether block is get settled in 12 seconds. Ethereum is hottest platform in the world of cryptocurrencies and blockchains.

Ethereum supply model is completely different from Bitcoin as Bitcoin Supply is limited to 21 million bitcoins but ethereum has unlimited supply but annual maximum supply is 18 million ether.

4.       Litecoin:-

Litecoin was founded in year 2011 by Google engineer Charlie Lee. Litecoin was founded to do the Transactions anywhere in the world without any intermediary. Maximum limit of litecoins is 84 million. The difference between Litecoin and Bitcoin is in its algorithm. Bitcoin uses SHA-256 algorithm and litecoin uses Scrypt. Litecoin can handle more transactions due to its shorter block generation time. As on date more than 66 million Litecoins are under circulation.

 

5.       Dogecoin:-

Dogecoin was discovered in year 2013 and it was created by following:-

(i)                  IBM Software engineer Billy Markus from Portland

(ii)                Adobe software engineer Jackson Palmer

This Coin has gained lot of action when Tesla owner supported that coin. This coin has a Dog picture on the coin face, the Dog is Shiba Inu. This coin was generated to serve no real purpose other than just generating laughs. Dogecoin Value is now more than 50 billion dollars.

 It was started as copy of Litecoin. Currently there are 129 billion Dogcoins available and more can be mined. The main difference from Litecoin and Bitcoin is that Bitcoin and Litecoins can be actively managed and are updated frequently for addressing the shortcomings and problems. But on the other hand Dogecoin is updated occasionally.

Now people are considering the tool for investment considering the rise of Bitcoin and alternative coins over the period of time. Initially it was considered as bubble when Bitcoin get risen to $20000 a Bitcoin in year 2018 and get corrected to $3000 in same year but now when Bitcoin get risen to $60000 everyone is thinking of making money from it and considering as serious investment tool

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