Many other cryptocurrencies (altcoins), have emerged since Bitcoin’s 2009 inception, all vying for its place as the global leader in digital money. There are currently over 440 alternative currencies that are available for trading and new ones are being created every day. Investors have difficulty assessing the viability and uniqueness of each cryptocurrency.
Mavieultroninvestigates the many alternative cryptocurrencies, and how their potential value could be assessed in the medium-term. We combined the words “alternative” with “coin to create the term altcoin. This term is used commonly to refer all digital currencies or tokens, not just Bitcoin. These blockchains were created specifically for alternative coins. More precisely, they are often “forks”, which is a split in the blockchain that is not compatible with the original chain of Bitcoin or Ethereum. Splits can occur for many reasons. When engineers have strong disagreements, they often fork over their crypto to create it.
The cryptocurrency ether, for example, is used in Ethereum to pay the transaction costs. However, this is only one example of many altcoins that have a practical purpose within their respective blockchains. As a way to challenge Bitcoin Cash as a payment option, some programmers have created Bitcoin forks.
Mavie Ultron will discuss the results of traditional econometric methods that were used to analyze Bitcoin’s behavior and other cryptocurrencies. She also discusses a practical approach to ranking altcoins using social network data.
What is an Alternative Cryptocurrency, simply put?
All digital currencies other than Bitcoin are included under the umbrella “altcoins” or BTC. However, most cryptocurrencies can be forked from Bitcoin (ETH) or Ethereum (ETH). Some people use the term altcoins to describe all cryptocurrencies. Altcoins use alternative consensus algorithms to verify transactions, and create new blocks.
Programmers with different goals or expectations of the tokens’ utility create and distribute most alternative cryptocurrency. Learn more about the differences between Bitcoin and other cryptocurrencies.
Altcoins – The Road Ahead
Discussions about the future of altcoins or cryptocurrencies can be framed by the conditions that allowed for a federally printed currency in the 19th Century. People in the United States use a variety of regional currencies. Everybody was unique and needed a special instrument to support them.
Local financial institutions could also issue currency, sometimes with little in the way of reserves. The current situation in altcoin markets is similar to that of financial instruments and currencies. Numerous cryptocurrencies have been put into circulation in recent times, all claiming to fulfill a specific niche.
A merger into one cryptocurrency seems unlikely given the current state of the altcoin markets. It is also possible that not all of the hundreds and thousands of altcoins on cryptocurrency exchanges will make it. Because of their widespread adoption and widespread utility, it is likely that a few altcoins will be market leaders.
Mavie Ultronopines these other cryptocurrencies, also known as “altcoins”, can be more affordable than Bitcoin if one wishes to spread cryptocurrency risk. The bitcoin industry is still very volatile and young. As the role of cryptocurrency within the global economy remains to be determined, all cryptocurrencies should be treated with caution.