In order to be confident in your moves and decisions while you invest in cryptocurrencies, you have to know how they work, and the differences between them. According to some sources, there are more than 5,000 cryptocurrencies under the market cap, and that means, you have a lot of choices if you want to be a crypto investor. In general, they are decentralized crypto money, that you can’t really hold in your hands, because they exist in the blockchain and have a form of tokens, but you can convert them into regular currencies, and cash them out. Trading is also a popular activity in this market, which means you can buy or sell cryptocurrencies for other types of fiat money. Check for more info https://cfd-trader.io.
But, before you take any step (which is pretty risky, but we will talk about it later), you have to learn more about all the aspects, their history, how they performed over time, and the methods and strategies you can use to invest or trade. Surely, the first thing that might come to your mind is Bitcoin, since it leads this market, and it’s the most popular currency among them all. But, that popularity comes with a price, and the value can go up or down with no earlier announcements or any obvious patterns. That’s why a lot of people were surprised in the past, thinking they have everything in their hands, just to find out the next morning they lost a lot of money.
So, let’s see what you have to know about the most popular cryptocurrencies:
It was meant to be a payment system, not a separate currency. But, it was the first cryptocurrency to be available on the market, attracting different opinions, showing huge value, and high volatility. Since it’s not stable enough, it still can’t be used as a standalone payment system. But, it’s very popular. People are trying to grab a piece of BTC every day. It had really bad days, but this year there were the greatest days in the history for this currency.
Mining is very time-consuming, requires a big electricity consumption, and demands powerful computers. But, knowing that there is a limited supply of BTCs and a lot of them are already mined and available for trading, we can say that it’s a better option for the investors to spend some money and get it. Surely, when the price is at its highest, it’s a bad time to buy it, but when it drops, you can consider investing some money in it.
It’s the second most popular cryptocurrency, and it’s probably the first altcoin that comes to our mind, is the Ether, which is a part of the decentralized software named Ethereum. So, as you can see, a lot of people are mixing these things up, since the currency is Ether, and the network where it exists is Ethereum.
But, since a lot of people are knowing it like that, there is no need to correct them. The good thing is that everyone can access it, and own a little piece, hoping that it will still grow. And it’s the second-largest currency, but there are some splits and forks, that are available through other networks too. Remember ETH is what you need, and ETC (Ethereum Classic) is practically a spinoff. It’s a really nice option to consider if you are too overwhelmed by Bitcoins.
If BTC is gold, then LTC is the silver in cryptocurrencies, because they work similarly, and you are keeping your logs of activity as proof of work. The difference is that mining and transactions are faster than Bitcoin’s, and the blocks are regenerating faster. It’s also easier to be adapted to the current market.
According to the market experts, it’s the sixth-largest cryptocurrency, but sometimes it’s the fifth or seventh, depending on how things are changing every day. For example, Litecoin needs 2.5 minutes to process the block, and BTC needs around 10 minutes. They are pretty similar, and probably they will use similar methods to work when cryptocurrencies will be widely embraced around the world.
This is a fork o the original Bitcoin, but it’s not the only one. There are many, but it’s the earliest and probably the most successful fork in the crypto world. Sometimes the people who provide the service can’t set their opinions, and that’s why they “fight” and split. BCH works with bigger blocks, so they can handle more transactions with better speed than Bitcoin’s. Nowadays, it’s worth around $470 for one token.
Practically, the situation is similar to Ethereum. Ripple is the digital network, and XRP is the currency. The transactions are really fast, and they are processed in a few seconds globally. The value is low, compared to all the other currencies we mentioned in this article. It doesn’t have a lot of chances to reach $1,000, but what we learned from Bitcoins is that in this market, everything is possible, even though some experts say it will never reach that price.
What are the other cryptocurrencies worth mentioning?
While we are here, it’s worth mentioning Stellar, which is also based on a blockchain network, as a solution for institutions and banks. Then Chainlink, which is similar to Ethereum, Cardano that was created by engineers and mathematicians who were part of the original Ethereum team, and of course, Tether, which is tied to the US dollar, which means it’s stable.
All of them are risky, and if we say that one is more than another, then we will lie at some point. It’s on every investor to research and explore the market, so you can decide by yourself what’s the best way to become a part of the crypto world. So, you really need to take your time and read some of the articles that are similar to this one. They are educational and informative enough, so you can learn more about this topic. But, that’s the only way to be informed and decide by yourself what you want to do next.