Cryptocurrencies are digital tokens existing on a digital platform that is decentralized and distributed, known as a Blockchain. The bitcoin transactions serves as both a platform for these currencies to exist and a ledger that records each transaction for transparency. Digital currencies were first introduced in the form of bitcoin back in 2009. Since then, they have become hugely popular with modern investors and civilians alike.
These currencies have made a system of decentralized financial investment and trading systems. However, newer cryptocurrencies with improved features are gaining popularity with the advancement in technologies. These new currencies have technological advances such as proof of stake and can handle more transactions per second than old cryptocurrencies such as bitcoin.
Overview of 5 cryptocurrencies:
. Stellar {XLM}:
Stellar {XLM} was introduced for providing enterprise solutions for different financial institutions by connecting them through the stellar network. Large transactions can take up to several days and weeks between financial institutions and large corporate firms. To put an end to this time-consuming process, the stellar network was made as it can handle large transactions in merely seconds. Furthermore, there is no need for an intermediatory agent; such agents also came with a substantial fee, while in comparison, the transaction fee charged by the stellar network is almost negligible.
. Dogecoin:
The origins of this particular coin came from memes! The price of the coin notably skyrocketed in 2021 as several big names in the industry advertised and promoted the currency, calling it the people’s coin. The coin was adopted as a means of payment by several large companies such as SpaceX, Kronos, and even the Dallas Mavericks basketball franchise. The all-time high mark that the coin reached in 2021 was 0.74 US dollars, which is a notable achievement for a meme coin.
. Binance coin {BNB}:
Binance coin {BNB} is a widely popular coin that serves as a payment gateway for the exchanging platform called Binance. Those who use this particular currency for transactions on the platform can avail specific discounts on their trades. The platform of Binance coin and the trading exchange Binance are the same. As Binance is a whale when it comes to exchanging platforms, this coin skyrocketed and is currently the 3rd most significant coin in the market.
. Monero {XMR}:
Monero {XMR} provides the user with complete anonymity as it’s an untraceable cryptocurrency. Mainly a community project, this coin is the prodigal child of cryptography enthusiasts. The currency uses a unique feature called the ring signature, which allows it to be completely decentralized and untraceable. As the security provided by the coin is robust, it has a notorious image in the market because of its usage by criminal enterprises all around the world. The ring signature feature creates multiple cryptographic signatures. It is nearly impossible to identify the real one as each of them appears to be valid in the context of the transaction. Even though the currency has a bad reputation in the market, it is widely popular as it also serves good honest people who are residing in repressive regimes.
. Polka dot {DOT}:
Polka dot {DOT} is a unique cryptocurrency designed to serve as a system under which different Blockchains can reside and interact. Its distinctive feature is of a relay chain which allows the interactions of multiple Blockchains at a time. Various networks are allowed to interoperate under the shelter of the Polka dot, connecting them smoothly and efficiently. Polka dot also enables users to create their Blockchains while taking refuge under the security of its cryptography. This mechanism is called shared security and allows new and small Blockchains to grow under its security.
The Bottom Line
Investing in cryptocurrencies is risky and speculative, but with the correct study and planning, one can make a fortune. Moreover, these currencies have made digital and decentralized transactions the face of the future. With exceptional security and nominal transaction fees, millions of users are now using Blockchain technology to their benefit. The scope of this market is yet to be fully seen; technology is getting more enhanced each day, providing the user with simple yet efficient solutions for their everyday transactions. One should use trusted platforms such as when purchasing or trading cryptocurrencies.