By Michael J Defosse - November 17, 2019
Before we take a closer look at some of the popular cryptocurrencies in 2019, let’s take a moment to briefly examine what we mean by the terms cryptocurrency and altcoin. A cryptocurrency, broadly defined, is virtual or digital money which takes the form of tokens or “coins.” While some cryptocurrencies have ventured into the physical world with credit cards or other projects, the large majority remain entirely intangible.
The “crypto” in cryptocurrency refers to the complicated cryptography that allows for a particular digital token to be generated, stored and transacted securely and, in most situations, occuring anonymously. Alongside this important “crypto” feature of these currencies is a common commitment to decentralization. Cryptocurrencies are typically developed as code by teams who build in mechanisms for issuance (often, although not always, through a process called “mining”) as well as other controls.
Our list includes some of the foundation cryptocurrencies along with some that made an impact in 2019. We also expect that each of these will make a continued impact in 2020.
Bitcoin is the oldest cryptocurrency and the first cryptocurrency to the market which has given it a first-mover advantage. Launching on January 3, 2009, Satoshi Nakamoto mined the genesis block of bitcoin (block number 0), which had a reward of 50 Bitcoin.
The transactions are verified by network nodes and recorded on a public ledger for optimal transparency. Anyone can look into the peer-to-peer network and see the complete history of a coin but discovering the users of those transactions is more challenging.
The process of verifying transactions is completed by miners and is known as cryptocurrency mining. While hypothetically you could use lower-powered hardware to mine, the more expensive and robust ASIC technology is widely used as other forms of technology can be unprofitable for mining.
Miners receive rewards for their work, with that reward being cut in half every 210,000 blocks mined. There is maximum supply or a preset number of Bitcoin that can be generated, which is 21 million BTC.
At present, Bitcoin has a circulating supply of 18,052,550 BTC and a market cap of $155.3 billion USD.
Ethereum, created by Vitalik Buterin, was launched in 2015 to operate as a technology infrastructure. It is a decentralized software platform that enables Smart Contracts and Distributed Applications (DApps) to be built and run without any downtime, fraud, control or interference from a third-party. The applications are run on its platform-specific cryptographic token, Ether. In 2016, Ethereum was split into Ethereum (ETH) and Ethereum Classic (ETC).
Ethereum’s average block time is much faster than Bitcoin’s, with Bitcoin running at about 10 minutes while Ethereum is between 10 and 20 seconds. The cost to transact on Ethereum is also different with Ethereum calculating the cost based on a term called gas. The amount of gas required for a transaction varies based on storage needs. In contrast, Bitcoin transactions are limited based on block size.
At present, Ethereum has a circulating supply of 108,587,463 ETH and a market cap of $20.1 billion USD.
Ripple is a real-time global settlement network that offers instant, certain and low-cost international payments. Launched in 2012 by Ripple Labs Inc, it is based on a distributed open-source protocol or ledger. All transactions pass through nodes and validators, which is similar to the Bitcoin system, however, Ripple has a high level of governance when compared with alternatives such as Bitcoin.
There is a consensus ledger that relies on specific validators, which are facilitated by global banks and other institutions. The consensus ledger is unique in that it doesn’t require mining and since it doesn't require mining, it reduces the usage of computing power and minimizes network latency. This is how Ripple provides fast settlement speed. The consensus mechanism settles transactions within seconds, which is much faster than many alternatives but one of the main advantages of Ripple is that it is accepted by anyone on the Ripple network and there are no extra trade or transfer fees on the coins.
Obtaining Ripple can be accomplished only through the purchase of the currency from an exchange. There is no option to obtain XRP (the Ripple altcoin) through mining, which makes it different from other types of cryptocurrency. There is maximum supply or a preset number of Ripple that can be generated, which is 100 billion XRP.
At present, Ripple has a circulating supply of 43,298,481,757 XRP and a market cap of $11.5 billion USD.
Litecoin, released in October 2011, is based on an open-source global payment network that is not controlled by any central authority. It was built to be technically similar to Bitcoin but, the founder, Charlie Lee, an MIT graduate and former Google engineer, designed it with a few key differences
One of those differences is faster block generation rate, which runs at 2.5 minutes. A faster block generation rate allows for a faster transaction confirmation so a merchant that requires double confirmation can process the transaction more quickly than with the Bitcoin system.
Mr. Lee also increased the maximum number of coins in the system as compared to Bitcoin. The maximum supply of Litecoin is 84 million LTC.
Transaction costs are minimal and the cryptocurrency uses the “scrypt” hashing algorithm, which favors large amounts of high-speed RAM rather than processing power, during the mining process.
At present, Litecoin has a circulating supply of 63,698,496 LTC and a market cap of $3.8 billion USD.
Bitcoin Cash is a cryptocurrency that is a fork of Bitcoin. In cryptocurrency, a fork occurs as the result of debates and arguments between developers and miners. Due to the decentralized nature of digital currencies, wholesale changes to the code underlying the token or coin at hand must be made due to the general consensus. The mechanism for this process varies according to the specific cryptocurrency.
When different factions can’t come to an agreement, sometimes the digital currency is split, with the original remaining true to its original code and the other copy beginning life as a new version of the prior coin, complete with changes to its code.
Bitcoin Cash was created in August 2017 as a result of one of these splits. The debate which led to the creation of BCH had to do with the issue of scalability. Bitcoin has a strict limit on the size of blocks, which is 1 megabyte. BCH increases the block size from 1 MB to 8 MB, with the idea being that larger blocks will allow for faster transaction times. It also made other changes, including the removal of the Segregated Witness protocol, which impacts block space.
At present, Bitcoin Cash has a circulating supply of 18,118,125 and a market cap of $4.9 billion USD
Monero, launched in April 2014, is an open-source cryptocurrency that is recognized as secure, private and untraceable. Developers noticed privacy was lacking while using Bitcoin. They also noticed that with other cryptocurrencies, transactions were said to be anonymous, but true privacy did not exist. Monero was created to solve that problem.
The development of Monero is completely donation-based and community-driven. In addition, it was launched with a strong focus on decentralization and scalability. To protect and enable complete privacy for the sending and receiving parties during a transaction, it uses a special technique called “ring signatures”, which obscure the identity of all parties by mixing account keys with public keys received from the Monero blockchain.
Similar to Bitcoin, Monero miners receive a reward for their work. The mining offers a permanent block reward, which means the value of the reward won’t change over time. Having a consistent reward means that if miners invest in technology today, the reward will stay consistent in the future.
At present, Monero has a circulating supply of 17,312,008 XMR and a market cap of $1.01 billion USD.
EOS, launched in June 2018, was created by Dan Larimar. Before his work on EOS, Larimer founded the digital currency exchange, Bitshares, as well as the blockchain-based social media platform, Steemit. Similar to many other cryptocurrencies, EOS is modeled after Ethereum. The design was created to promise a new blockchain technology which entails an operating system that is faster and easier to scale than Ethereum while allowing users to create decentralized applications more easily. EOS is notable for other reasons.
First, the initial coin offering for EOS was one of the longest and most profitable in history, raking in a record $4 billion in investor funds through its initial crowdsourcing efforts. EOS offers a delegated Proof-of-Stake mechanism, where it hopes to be able to offer scalability beyond its competitors. EOS consists of EOS.IO, similar to the operating system of a computer and acting as the blockchain network for the digital currency, as well as EOS coins.
EOS is revolutionary because of its lack of a mining mechanism to produce coins. Instead, block producers generate blocks and are rewarded in EOS tokens based on their production rates. EOS includes a complex system of rules to govern this process, with the idea being that the network will ultimately be more democratic and decentralized than those of other cryptocurrencies.
Lastly, EOS is the first blockchain with a constitution. There are governing principles that every stakeholder agrees on, and the set of rules is attached to every block that is mined. EOS will have the capability to process millions of transactions each second using horizontal scaling. This is much different from Bitcoin and Ethereum. The current model also allows for 5 percent inflation, which can be used to further develop the network. In addition, EOS does not require users to pay for each transaction, which will help fuel adoption.
At present, EOS has a circulating supply of 940,565,173 EOS and a market cap of $3.25 billion USD.
Cardano is a decentralized and open-source blockchain that Charles Hoskinson, one of the co-founders of Ethereum, launched in September 2017. For supporters of this digital currency, it offers all of the benefits of Ethereum, as well as many others. Cardano provides a platform for DApps and smart contracts, like Ethereum but additionally, ADA aims to solve some of the most pressing problems plaguing cryptocurrencies everywhere, including interoperability and scalability.
Cardano, calling itself a first third-generation cryptocurrency, also hopes to tackle issues related to international payments, which are typically both timely and expensive. Thanks to its focus on this area, ADA was able to take international payment processing times from days down to just seconds.
There is maximum supply or a preset number of Cardano that can be generated, which is 45 billion ADA and at present, Cardano has a circulating supply of 25,927,070,538 ADA and a market cap of $1.19 billion USD.
Stellar, launched in 2014, is a decentralized and open-source blockchain that was founded by Jed McCaleb, who is also the founder of Mt. Gox and co-founder of Ripple. Ripple was hard forked into Stellar and later called Lumens or XLM. It is focused on building an application to make cross-border payments more efficient.
Stellar is more decentralized as compared to its closest competitor, Ripple, and it has secured strategic partnerships with over 30 banks and with organizations like Deloitte and IBM.
At present, Stellar has a circulating supply of 20,054,779,554 XLM and a market cap of $1.46 billion USD.
Dash, launched in January 2014, is an open-source peer-to-peer cryptocurrency with the goal of being more user-friendly than other options. It is also a more secretive version of Bitcoin in that its anonymity makes transactions almost untraceable.
Formerly known as Darkcoin and Xcoin, Dash created masternodes (subset of users), which provide incentives to users to help secure the network and assist with user-friendly features, such as InstaSend, which significantly speeds up transaction-processing times.
Operators are required to invest 1,000 dash to host a masternode, but they get 45 percent of the reward for each Dash block that is mined. Operators receive about 7 dash per month. The cryptocurrency also offers PrivateSend (formerly DarkSend), which provides a more secure method for conducting transactions. PrivateSend ensures users full privacy of their transactions.
Dash also runs governance different from other cryptocurrency. Each masternode gets one vote, and the Dash blockchain is self-funded. A portion of each block reward (10 percent) is put back into the network development and promotion budget, which means that developers receive payment for work completed. In addition, since there are voting rights, decisions can be made more quickly than with other cryptocurrencies. The maximum supply of DASH is 18.9 million DASH.
At present, DASH has a circulating supply of 9,158,412 DASH and a market cap of $626.3 million USD.
NEM, launched in March 2015, is a peer-to-peer cryptocurrency and blockchain platform. It introduced new features to blockchain technology, including the Proof-of-Importance (POI) algorithm. In addition, it introduced multi-signature accounts and encrypted messaging.
NEM technology allows multiple ledgers to co-exist on one blockchain. NEM “Smart Assets” allows users to create and configure mosaics, which can represent any asset including currencies, supply chains, ownership records and more as a method to deploy blockchain solutions faster.
The technology is suitable for a variety of solution classes, such as direct public transactions via streamlined smartphone app, efficient cloud services that connect client or web applications or a high-performance permissioned enterprise back-end for business-critical record keeping.
At present, NEM has a circulating supply of 8,999,999,999 XEM and a market cap of $387.2 million USD.
IOTA, launched in June 2016, is a distributed ledger designed to record and execute transactions between machines and devices in the Internet of Things (IoT) ecosystem. The ledger uses a cryptocurrency called mIOTA to account for transactions in its network. It is recognized as the first open-source distributed ledger that is built to power the machine economy through fee-less micro-transactions and data integrity. The technology was founded in 2015 by David Sønstebø.
The technology uses a Directed Acyclic Graph (DAG) instead of the traditional blockchain. What’s interesting is that unlike other cryptocurrencies, such as Bitcoin, which can have high transaction fees, IOTA’s transactions are free, regardless of transaction size. Confirmation times are quick and the system is designed to handle a large number of transactions with great speed.
Most blockchains rely on miners to confirm transactions but IOTA has no mining and no blocks. Users of the network validate two older transactions through Proof-of-Work in order to conduct one of their own. There are no rewards given to users.
At present, IOTA has a circulating supply of 2,779,530,283 MIOTA and a market cap of $726.3 million USD.
NEO, released in February 2014, it is a decentralized and open-source blockchain. It was created by Da HongFei and Erik Zhang. Originally called AntShares, the coin was rebranded in 2017. Currently, it is the largest cryptocurrency to have emerged from China and it is sometimes referred to as a “Chinese Ethereum” because of its similar use of smart contracts (NeoContracts) to issue and manage digitized assets.
NEO employs a Proof-of-Stake (PoS) consensus mechanism called Delegated Byzantine Fault Tolerance (dBFT). With dBFT and some other key optimizations, Neo claims to be able to handle over 1,000 transactions per second with a goal of optimizing to over 10,000 transactions per second.
The base asset of the NEO blockchain is the non-divisible NEO token which generates GAS tokens. These GAS tokens, a separate asset on the network, can be used to pay for transaction fees. The inflation rate of GAS is controlled with a decaying half-life algorithm that will release 100 million GAS over approximately 22 years.
NEO has experienced benefits as a result of its positive relationship with the Chinese government, which is generally known for its harsh positions on cryptocurrencies.
There is maximum supply or a preset number of NEO that can be generated, which is 100 million NEO and at present, NEO has a circulating supply of 70,538,831 NEO and a market cap of $585.7 million USD.
Zcash, launched in October 2016, is a decentralized and open-source blockchain. It offers privacy and selective transparency of transactions using addresses that are either private (z-addresses) or transparent (t-addresses). Z-addresses start with a “z” and t-addresses start with a "t".
A Z-to-Z transaction appears on the public blockchain, so it is known to have occurred and that the fees were paid but the addresses, transaction amount and the memo field are all encrypted and not publicly visible. Using encryption on a blockchain is only possible through the use of zero-knowledge proofs called zk-SNARKs.
Transactions between two transparent addresses (t-addresses) work just like Bitcoin. The sender, receiver and transaction value are publicly visible. While many wallets and exchanges exclusively use t-addresseses today, many are moving to shielded addresses to better protect user privacy.
There is maximum supply or a preset number of Zcash that can be generated, which is 21 million ZEC and at present, Zcash has a circulating supply of 7,871,556 ZEC and a market cap of $288 million USD.
TRON, launched in September 2017, is a decentralized platform founded by Justin Sun that is training to build a free, global digital content entertainment system with distributed technology that allows easy and cost-effective sharing of digital content.
The TRON Protocol represents the architecture of an operating system based on the blockchain which could enable developers to create smart contracts and decentralized applications, freely publish, own and store data and other content. According to the TRON Foundation, the ecosystem surrounding this network specializes in offering massive scalability and consistent reliability capable of processing transactions at a high rate via high-throughput computing.
At present, TRON has a circulating supply of 66,682,072,191 and a market cap of $1.26 billion USD.
In 2018, GlobEx Markets created tokens for the future development of its media distribution model that is under development and launched in 2020. There is a maximum supply or a preset number of GlobEx Markets Tokens that can be generated, which is 950 million GEXM and at present, all tokens are held in the GlobEx Markets Treasury account so none are circulating. For more information on these tokens, contact GlobEx Markets at:
Cryptocurrencies are almost always designed to be free from government manipulation and control, although, as they have grown more popular, this foundational aspect of the industry has come under scrutiny. The currencies modeled after Bitcoin are collectively called altcoins and have tried to present themselves as modified or improved versions of Bitcoin. While some of these currencies are easier to mine than Bitcoin, there are tradeoffs, including greater risk brought on by lesser liquidity, acceptance and value retention.
Our list included some of the most popular and important digital currencies. It is impossible for a list to be entirely comprehensive. One reason for this is the fact that there are more than 1,600 cryptocurrencies in existence and many of those tokens and coins enjoy immense popularity among a dedicated community of backers and investors.
The field of cryptocurrency is continually expanding and the next great digital token could be released tomorrow. While Bitcoin is widely considered as the pioneer in the world of cryptocurrencies, analysts adopt many approaches for evaluating tokens other than BTC. It’s common, for instance, for analysts to attribute a great deal of importance to the ranking of coins relative to one another in terms of market capitalization.
While Bitcoin continues to lead cryptocurrencies in market capitalization, user base and popularity, there are other virtual currencies, such as Ethereum and Ripple, that are being used more for enterprise solutions while other tokens and altcoins are being endorsed for superior or advanced features as compared to Bitcoin. Going by the current trend, cryptocurrencies are here to stay but how many of them will emerge as leaders amid the growing competition within this space will only be revealed in time.