2017 has witnessed significant volatility in Bitcoin prices and the risk attached to taking a position at current prices is also significantly higher. But, you can consider bitcoin alternatives at more attractive prices with a reasonable expectation of quick appreciation.
In 2009 when Bitcoin was first introduced, Kristoffer Koch, who was working on a thesis covering encryption, took a fancy to the new offering and bought up 5,000 bitcoins for a mere $27! Today, assuming he is still holding that, he is worth an astounding $70844225, a mighty appreciation in less than a decade. Bitcoin alternatives may not bring you such monstrous returns though your gains can be impressive in a short span of time.
Notwithstanding the significant volatility experienced by Bitcoin in 2017, there are bitcoin alternatives that hold out a promise, with some of them even predicted to surpass bitcoin over the next 5 years. We have also heard of stories about people borrowing funds via mortgages or other means to buy bitcoin, influenced by the wild price swings during 2017. But, there are also others who hold the view that bitcoin alternatives would pave the way to bring a basket of cryptocurrencies into the main stream of the global economy. On that note, here is a look at some of the promising bitcoin alternatives.
The blockchain technology employed by Ethereum is programmable, allowing developers to build other technologies and apps that is claimed to be ahead of the bitcoin blockchain technology, and not easily compatible with that. Nearly anyone can mine their Ethereum cryptocurrency. This in turn has encouraged many companies to adopt the platform as a means of raising money to fund their projects. As we approach the end of 2017, Ethereum is trading close to the $700 mark and some project it will soon surpass the $1000! It is not out of the question for ETH to catch up to Bitcoin in the near future. Ethereum has a market cap close to $60 billion USD and is regarded the second largest among bitcoin alternatives. The popularity of Ethereum is also running neck to neck with Bitcoin. Given this backdrop, Ethereum holds out a promise as a fast growing bitcoin alternative.
For those who are familiar with cryptocurrencies, you have possibly looked at Litecoin which is also known as “Silver” while Bitcoin is reckoned as “gold”. Litecoin was also among the first altcoins introduced in the market. The algorithm employed by Litecoin is in fact based on the bitcoin technology and that helps its adoption and trust factor similar to bitcoin. But Litecoin is cheaper and faster with regard to transactions and technically superior compared to Bitcoin. Charlie Lee, the founder of Litecoin hopes that these factors would aid the adoption rate in the days to come and make bitcoins more comfortable for the general populace. The growth of Litecoin has also been aided by the co-operation approach in place of competition, particularly during 2017 when LTC ballooned from $6 to approximately $300 across 2017.
Ripple is marginally different compared to other bitcoin alternatives in as much as it does not employ a straight-up blockchain in its network. Instead it uses a process known as iterative consensus. In practice, this means that unlike other cryptocurrencies, Ripple cannot be mined. While the world is seeing a steady rise in the number of bitcoins, Ripple has prescribed a limit at 100 billion. If the best description for bitcoin is a decentralized digital currency, a transaction network with a digital currency better fits Ripple. In turn, this would also mean that Ripple Network can in fact be useful in tracking any kind of information and not limited to a single currency. Ripple has risen by as much as 20,000% YTD though the XRP value hovers around the $2 mark which means that an investment made today can grow exponentially over the next few years. Ripple however has to contend with some completion from other bitcoin alternatives employing technology for decentralized transactions. Stellar Lumens which uses a similar model as that of Ripple is critical about the lack of security. But, that has not dented the progress of Ripple and continues to be a major name in the world of cryptocurrencies. Ripple has also entered into partnership with banks for testing its blockchain.
These are just some of the top picks of bitcoin alternatives and it is important that you understand the pace at which the cryptocurrency market is moving. For those intending to invest or trade in cryptocurrencies, it is imperative to carry out a thorough research (consult your financial adivsor) and generally keep abreast of all events in the crypto market and technology that supports each coin. The research should also ideally extend to dozens of other bitcoin alternatives that hold the potential to perform equally well, or perhaps, even better than all of what has been seen so far, including Bitcoin.