Many people do not know, but there are hundreds of crypto-currencies similar to Bitcoin. Among them, dozens are certainly viable and bring undeniable advantages, both in relation to Bitcoin and traditional currencies.
Most of the time, we tend to describe (and classify) these currencies according to the algorithms on which they are based or their principles of operation. We will say for example that a currency uses X11 and is based on the principle of “Proof of Work”, simply meaning that it is the computing power of the computers that form the network of this currency which serves to secure transactions, and that these calculations are based on the cryptographic algorithm X11.
Although these elements are important, they are technical jargon and are of more interest to investors and specialists than ordinary people. A currency is not only made to be mined and it is in my opinion more interesting to separate crypto-currencies according to their most obvious uses. One can thus establish the following classification, considering before anything else what what must – or can – serve each currency.
These are “heavyweights”, which should not be called “crypto-currencies” because their ambition goes well beyond the simple means of payment. These are more platforms or, if you will, “meta-currencies”. Often called “Bitcoin 2.0”, these projects aim to build real alternatives to existing financial systems, by generalizing the principles inherent to crypto-currencies (decentralization, security, distributed consensus …) to all types of applications: decentralized markets, smart contracts (smart contracts), listed and tradable assets, etc. These are / will not be “coins” very simple to use by the general public, and they are intended rather for professional or semi-professional uses, but other more accessible currencies, themselves based on these protocols and flat Platforms.
They are very similar to Bitcoin, except that they provide additional improvements or innovations, such as shorter transaction verification times or currency exchange services integrated into the wallet. They remain relatively simple to use and form complete solutions, deserving the name of true “alternatives” to Bitcoin (Bitcoin Zero Ledger Electrum). If we look at it, these stable currencies, based on solid development teams, offering real ergonomics of use and already accepted by merchants, are not as numerous as we think.
These are simple currencies, mainly designed to easily exchange small financial amounts between Internet users (“social tipping” or “social tip”), especially through existing social networks. They do not claim to replace existing systems, and will probably never be accepted by physical stores, but they are a good example of what cryptocurrencies can do and that no other means of payment allow.
In my opinion, this is one of the most interesting categories, and also the one with the most potential in the short term. In fact, this category is the “killer application” that was lacking to democratize the principle of cryptocurrency and generalize their use. Crypto-currencies of this type could be Bitcoin (Bitcoin Zero Ledger Electrum) and alternative currencies what blogs have been for the Web: a simple way and accessible to all to become active, and thus better understand the interest and power. It should be noted that crypto-currencies in this category, more than any other, are in direct competition and their promoters will fight fiercely to impose their currency as “universal means of micro-payment”.
If you have never used cryptocurrency, this is the best way to learn: these currencies are simple to understand and use (sometimes with only a smartphone). Even if one can argue that any cryptocurrency has the desire to become one day a tool used to buy goods and services, some of them are more focused on this aspect than others. These currencies are developing with the stated objective of becoming a new means of payment acclaimed to make purchases (online or in real life), and their creators will therefore focus on partnerships with merchants, provide credit cards. credit compatible with their currency, or carry out active marketing initiatives targeting the general public.
Often launched by companies, they can be broad-spectrum (allow to buy everything), or very specialized on a specific sector. There are probably a few dozen but, again, most are not viable. It is also likely that big players online trade will try one day on this ground, offering their own cryptocurrencies.