Different Uses for Different Cryptocurrencies
Not all cryptocurrencies are created equal. Since the inception of Bitcoin, cryptocurrencies have evolved into much more as the technology behind them, the blockchain, was studied and developed. Different cryptocurrencies serve different purposes that can go far beyond a simple money transfer. Of course, Bitcoin has also led to the creation of cryptocurrencies meant to be used as money. Some are merely clones that bring nothing new to the table, but others like Dash, Monero, Vcash, and more have been able to advance the technology bringing new features and characteristics that make them special as a payment method.
Bitcoin – Currency
Bitcoin is the first and most popular cryptocurrency out there. It was designed to be a peer to peer and trustless currency that allows users to transact directly between them without being subject to censorship or middleman overhead fees. Bitcoin is a simple tool designed to move value from one place to another and it does its job perfectly!
Bitcoin uses the SHA256 hashing algorithm, and it has a 10 minute block time, which makes its transactions slow in comparison to other cryptocurrencies, so why is Bitcoin perfect to be used as a currency? Well, firstly it’s extremely popular when compared to other coins, which means that there are a lot of exchange liquidity (easy to buy and sell) and that it is widely accepted as a payment method, which is not the case with other cryptocurrencies. Bitcoin is also the safest cryptocurrency there is, a veteran that has to withstand the test of time due to its strong Proof of Work protocol and its colossal network of miners.
Ether – Smart Contracts, Dapps, DAOs
Ethereum is not a cryptocurrency per se, it’s a blockchain platform with smart contract functionality that is fueled by its native value token, Ether. Ethereum is much more than a simple digital currency. It allows the creation and deployment of decentralized applications (dapps) and Smart Contract Systems.
Dapps can function just like any other application with several advantages like the impossibility of hacks or server downtime, due to their decentralized nature in which the application is hosted by every node in the Ethereum network.
Smart Contracts are contracts that execute themselves automatically, they are computer protocols that facilitate, verify, or enforce the negotiation or performance of a contract. An example of a simple smart contract is one in which in order for pre-programmed transaction to take place, another event (like a different transaction taking place, or a certain block being mined) must first occur, signaling the smart contract to initiate the transaction.
Ethereum is like the internet for blockchain projects, as it allows the creation of many new applications and systems.
Monero – Privacy centric currency
Like Bitcoin, Monero was created as a peer to peer currency, but with a different focus. Monero is a privacy-centric cryptocurrency. It allows users to mix transactions amongst themselves so that they cannot be traced. Monero uses the Cryptonote as an algorithm.
Many assume that Bitcoin is an anonymous currency, which couldn’t be further from the truth, as every transaction is publicly listed on the blockchain. With Monero, transactions are mixed and wallet balance is protected with viewkey limitations.
Monero was recently added as an accepted currency in the biggest dark market in the deep web, thus consolidating its position as the Number One cryptocurrency for anonymity.
Bitshares – Asset issuance and Decentralized exchange
Bitshares was created as a means for users to trade currencies and assets amongst themselves in a decentralized way. Using Bitshares anyone can issue an asset which can be traded directly on the Bitshares blockchain. Market Pegged Assets also allow users to buy and sell commodities like gold, silver and fiat currencies like USD and EUR within the platform. These Market Pegged Assets are always backed twofold by the Bitshares native currency (BTS). Unlike Bitcoin, Ethereum, and Monero, Bitshares uses a delegated Proof of Stake consensus mechanism, means that no computing power is wasted in its issuance.
BitCrystals – In-game currency
BitCrystals is a Counterparty asset issued on top of the Bitcoin blockchain, meaning that it does not have its own. BitCrystals is meant to be used as the premium currency in the Spells of Genesis Online game, which allows users to buy items and card packs. Some of these cards are also Counterparty which means that they can be traded on the Counterparty decentralized exchange outside of the game, thus allowing users to own items inside and outside of the game itself.
Spells of Genesis not only incorporates blockchain in its economy but also its storyline with cards like “Satoshi Card”, “Ethereum Card” and others.
Xaurum – Store of value
Xaurum is na Ethereum-based project. Backed by gold, the XAUR token is not only a stable asset that represents the precious metal that backs it, but it is also an economic system in which the gold reserves belonging to XAUR are always increasing, thanks to the revenue generated by their Muiti-Pool called “GoldMine” and by the “Coinage” feature, which allows users to buy Xaurum directly from their developers, who will in turn back it with newly bought gold. Since it’s creation Xaurum has gone from being backed by 1 gram of gold per token, to being backed by more than 3 grams. Thanks to this system, Xaurum is the only cryptocurrency that can truly be seen as a store of value and not just a commodity backed asset.