Different Types of Cryptocurrencies and Their Comparison - Know Which One is Worth Investing

Here is the difference between cryptocurrencies that will help you understand the fundamentals of the crypto world.

Cryptocurrency is one of the fastest-growing industries on the stage of the world today. However, unlike many others, it is difficult to understand what is going on within it. The industry involves the use and sale of cryptocurrencies, which are digitally created and monitored currencies.

To put it simply, cryptocurrency is a type of digital currency that is assigned a value based on market demand.

The sudden increase in popularity and demand for these cryptocurrencies has led to a boom in the industry itself and many individuals became millionaires overnight. The whole system works on a framework known as Blockchain, which is a centralized system that incorporates the currencies into itself.

The system is prided on not being easily hackable or manipulated. There are no servers and the system exists across different personal computers as a point to point connection, which adds to its robust security. To streamline it among the masses, we have also got Blockchain Wallet, through which, you can transact cryptocurrencies.

Several different types of cryptocurrencies are present in the market. Some of the most popular cryptocurrencies include Bitcoin, Bitcoin Cash, Litecoin, Ripple, and Ethereum.

Cryptocurrency Comparison: Bitcoin vs. Bitcoin Cash vs. Litecoin vs. Ethereum vs. Ripple

To compare cryptocurrencies, we have accounted for factors like popularity, price, number of engagements, and more. Check out our detailed cryptocurrency comparison below:

1. About Bitcoin (BTC)

Bitcoin is the first decentralized digital currency and is known to be the largest cryptocurrency by value. In simple words, it is the same as a dollar but operates in the virtual world. With its extensive use, a mobile-based Bitcoin wallet also surfaced which has many advantages.

In 2017, Bitcoin’s market value was close to 87% of the total cryptocurrency market, leaving behind all other cryptocurrencies. But soon the value dropped by 38% due to the emergence of Ethereum. However, Bitcoin later recovered to nearly 70% of the market.

Interestingly, the craze around bitcoin has acted against the virtual currency. Due to the extensive use of Bitcoin, the transaction time of Bitcoin is spiked significantly and stands to be around 10 minutes. Due to the same, people started looking for alternatives to Bitcoin.

What is Bitcoin’s worth: USD 8,679

 

Pros of Using Bitcoin

• The number of Bitcoins is limited.
• Bitcoin is widely accepted as compared to Bitcoin’s other cryptocurrency types.
• It’s is easier to liquidate.

Cons of Using Bitcoin

• It fluctuates often and doesn’t promise a fixed return.
• It can be replaced as the top cryptocurrency.
• It’s known to be used for illegal transactions.

2. About Bitcoin Cash (BCH)

Bitcoin Cash emerged after the split of Bitcoin. The differences were reported among the developers and the miners. Because developers were skeptical of the high transaction times and to reduce the same, they wanted to increase the size of each transaction, which would have boosted its transaction speed. On the other hand, miners were of the view that by increasing the size of each transaction, they might compromise on security.

Ultimately, the Bitcoin ended as a new cryptocurrency, giving rise to Bitcoin Cash. The split added on the fortunes of the Bitcoin users, as they received free bitcoin cash tokens.

What is Bitcoin Cash’s worth: USD 286

 

Pros of Using Bitcoin Cash

• It’s a highly efficient cryptocurrency currency.
• Bitcoin cash is safe against possible replays and wipeouts.

Cons of Using Bitcoin Cash

• It’s new and doesn’t have the trust of many people.
• Due to being new in the industry, it’s adoption rate is also low.

3. About Litecoin (LTC)

Litecoin is known as the closet rival of Bitcoin. Charlie Lee, the founder of Litecoin, termed the currency as the ‘silver to Bitcoin's gold.`` And the maximum supply of Litecoin, which is 84 million coins, backs Lee's opinion, as it’s our times greater than Bitcoin’s.

Other than the supply value, Litecoin has some considerable technological differences, as well.

The most substantial difference between Litecoin and Bitcoin is the transactional speed, which is less than 100 seconds (avg.) for the Litecoin and 10 minutes (avg.) for the Bitcoin.

Due to its price, Lee even claimed that one could go out for as many Litecoins as he can, which will, of course, add to its value.

“People think you have to buy one whole Bitcoin or one whole Litecoin. People didn’t realize you can actually buy a small portion of a Bitcoin.”

What is Litecoin’s worth: USD 61

 

Pros of Using Litecoin

• It’s faster and much cheaper than Bitcoin.
• Supports Lightning Network that allows fast and cheap payments.

Cons of Using Litecoin

• The difference between Litecoin and Bitcoin is not that vast.
• The closure of LitePay lowered its credibility in the virtual world.

4. About Ripple (XRP)

Ripple is a cryptocurrency that was released in 2012 and was an iteration of the Ripplepay method. It acts like a real-time settlement system and currency exchange. The ledger used by the currency is common and managed by several different servers, present on a public database that is shared at the same time.

The consensus in the Ripple’s transaction is provided through the different servers to maintain the integrity of the entire system. The servers can be in the hands of everyone, either individuals or banks.

The currency is closely related to the Ripple protocol and is created to enable money to be directly and quickly transferred between two parties. The currency exchange has no limit and can be anything from FIAT (a legal tender currency whose value is backed by the government) to other assets like airplane miles. It helps avoid the waiting of banks and fees for transactions.

What is Ripple’s worth: USD 0.27

 

Pros of Using Ripple

• It’s a trusted currency, as top financial organizations use it.
• It has a well-structured infrastructure.
• Ripple has a better stability factor as compared to other cryptocurrencies.

Cons of Using Ripple

• Ripple isn’t decentralized and hence, it involves the collaboration of third-party companies.
• The currency lacks in real-world use.

5. About Ethereum (ETH)

Ethereum is a cryptocurrency that is backed by the working of a decentralized system. Much like other cryptocurrencies, it allows the currency to remain fully autonomous and is not controlled by a single person.

Sadly, after its early rise, Ethereum’s value took a beat due to the failure of a small part of the framework. However, the entire currency was not affected except for a small spike. When it settled, Ethereum’s value was on the rise again and is consistently on the rise throughout.

What is Ethereum’s worth: USD 185

Pros of Using Ethereum

• dApps built on Ethereum can’t sync with any other cryptocurrency
• More and more projects are built using Ethereum
• The transactional speed of Ethereum is one of the fastest.

Cons of Using Ethereum

• Ether coins are virtually endless.
• Sluggish transaction speed

Cryptocurrency Comparison: Bitcoin vs. Bitcoin Cash vs. Litecoin vs. Ripple vs. Ethereum

Here are the different types of cryptocurrencies and their comprehensive comparison:

With the current pace, Cryptocurrency and blockchain technology will continue to influence the industries across the globe. Though the technology is still in its infancy and it won’t be long when various cryptocurrencies and the blockchain technology will be adopted at large.

Even the economic analysts have predicted a favorable change with the advent of institutional money. And the possibility of crypto floating on the Nasdaq (a stock market index) is high, which will add to its credibility.

In the years ahead, cryptocurrencies will be a part of the mainstream financial system and other sectors as well.