Have you used Bitcoins to make online payments? If you are unaware, Bitcoin is the digital currency operational since 2009 which can be used to make digital payments at eBay, Amazon.com, Dell, Zappos, and others. One of the most prominent features of Bitcoins is that they are not printed like other currencies, are decentralized which means that they are not owned by Institutions or banks but are managed by a network of a community known as “Miners”. As I write the value 1 Bitcoin is 1071.89 US Dollar and is the leading Cryptocurrency in the market.
Bitcoin mining is difficult, Bitcoins are mined with computers by solving mathematical algorithm equations called “hashes” and require higher Power consumption. There are many cryptocurrencies in the market which can be good alternatives to Bitcoin, find a list of 4 Bitcoin alternative.
4 Cryptocurrencies Which You Should Know
With Bitcoin dominating the market of the Cryptocurrency, the latest entry Ethereum is the second top Cryptocurrency as per Market Capitalizations after Bitcoin. Ethereum is blockchain-based platform featuring small contract and the Ethereum Virtual Machine (EVM). The coins of Ethereum are known as Ethers.
How is Ethereum Different to Bitcoin?
In Bitcoin, the average block time is 10 minutes whereas in Ethereum it is 12 minutes. The high average block time in Ethereum is done by using Ghost Protocol which leads to faster transactions.
Bitcoin Mining is less rewarding as compared to Ethereum. The reward of Bitcoin coin mining halves about every four years whereas Ethereum rewards its miners of same amount every year.
Ethereum uses Ethash which is a memory hard hashing algorithm which lets users to mine Ethers using GPU (Graphic Processing Unit) while Bitcoin uses ASICs.
Ripple was launched in 2012 by Chris Larsen’s OpenCoin Company and now funded from Andreessen Horowitz, FF Angel IV, Lightspeed Venture Partners, Vast Ventures and the Bitcoin Opportunity Fund. Ripple is both digital currency (XRP) and an open payment system which is used to transfer any kind of currency including Bitcoins.
Ripple can be used to make any kind of transaction by making a small transaction fee of $0.0001. Ripple plans to create 100 billion ripples but only half ripples will be put in circulation.
Ripple is similar to Bitcoin:
Ripple and Bitcoin are both open-sourced protocol and allow peer-to-peer transaction online.
Ripple and Bitcoin are both centralized.
The differences between Ripple and Bitcoin:
Ripple is more energy efficient and can transfer any form of currency at a faster rate as compared to Bitcoin. Transaction time in Ripple is 5 seconds whereas Bitcoin takes 10 minutes to do the same.
Bitcoin is a decentralized currency while Ripple is a decentralized payment network with its own digital currency (XRP).
Litecoin was launched in 2011 by a former Google employee Charles Lee and is one of the top “altcoin” or “bitcoin alternative” based on Blockchain technology.
Is Litecoin better than Bitcoin?
Litecoin uses Scrypt algorithm, Bitcoin uses SHA-256. The use of SHA-256 requires more powerful ASICs for mining and hence more difficult. Litecoin can be mined easily on graphic cards of existing computers.
A new block can be discovered in every 2.5 minutes whereas it requires 10 minutes to discover a new block in Bitcoin.
Litecoin creation is capped to 84 million whereas Bitcoin has a limit of 21 million.
Monero was created April 2014 and built on CryptoNote protocol, unlike Bitcoin. Let us go through the differences between Monero and Bitcoin.
Monero uses Cryptonight instead of SHA-2 which means CPU mining is possible in Monero while it is not in Bitcoin.
In Monero a block is generated in just two minutes which results in faster transaction whereas it takes 10 minutes to generate a block in Bitcoin.
Monero is capped at 18.4 million coins over 8 years after that annual inflation <1% while Bitcoin is capped at 21 million.
The above mentioned are top Bitcoin alternatives which promote decentralization. Share your views on the use of Cryptocurrencies in the comment below!