What are Altcoins and what does it have to do with Bitcoin?
There are so many new concepts that have emerged as a result of the creation of the Bitcoin... right? Transactions, tokens, cryptocurrencies, blockchain. And now, on top of that, we can also talk about altcoins. We believe that today is a great day to talk about this concept and explore it further. Would you like to join us?
Let's do it!
What are Altcoins?
Any cryptocurrency that is not Bitcoin can be an altcoin, something that is used to define or refer to other supported cryptocurrencies, besides Bitcoin.
Nowadays, we wonder how many altcoins there are, but it is a figure hard to know because of the immense number of tokens that are created every so often to finance different activities or projects. And we are not surprised, creating an altcoin is a simple process because of the open source of the Bitcoin. You know what we mean, right?
AS Academy Bit2me points out, "some cryptocurrencies as Ethereum offer the simplicity of being able to develop tokens without creating a new blockchain network. Using a Smart Contract, we can create the foundations of a new token, development costs are reduced and the project funding is simpler."
What is the main advantage of these alternative cryptocurrencies?
The more positive side of the cryptocurrencies is in its advantages, those which we summarize below:
- Its eagerness to seek and find solutions makes simpler processes that users carry out, such us the control of energy, the health management and payments processes.
- Greater autonomy and independence because it does not have a central system that manages our data and operations.
- Bitcoin activated the shift lever, but as a result of its creation there have emerged new cryptocurrencies that evolve and present themselves as authentic altcoins or alternative models that improve, little by little, the blockchain technology.
- Blockchain brings transparency in the information management, since it allows that any user can audit the information of the blocks to check the veracity of the data.
The best altcoins are those that offer an added and differential value. Creating a cryptocurrency is easy, but offering a distinct and competent functionality not so much. Not all the cryptocurrencies provide value, because they are simple copies of the code. Then, what are the differential aspects of cryptocurrencies?
Think about it...
Difference between Ethereum and Ripple
Both cryptocurrencies are moved by the blockchain universe. While Ethereum was launched in 2015, Ripple was created around 2012, three years earlier.
Their main objective was to become a currency in itself, and neither of the two altcoins need the presence of a third party or intermediary. In addition, Ethereum is one of the cryptocurrencies that provide faster transfers (in 16 seconds approximately), while Ripple needs only around 4 seconds. Therefore, we highlight the quickness. In terms of the equipment, while a Foundation is responsible for the development and support of Ethereum, Ripple is administered by the Ripple Labs company. Finally, we want to highlight a difference that attends to the consensus mechanism: in Ethereum it receives the name Proof-of-work (PoW), and in Ripple is known as Byzantine Fault Tolerance (BFT).
Would you like to know something more about the role of the alternative cryptocurrencies in our day to day? Ask us, the altcoins are changing the way in which we manage our life operations.