About crypto

Learn The Basics How Cryptocurrencies Work

Cryptocurrency Basics

Cryptocurrency is a general name referring to all encrypted decentralized digital currencies like Bitcoin. Cryptocurrency uses cryptography to create coins and secure transactions. Typically, cryptocurrencies are open source with pubic, but encrypted ledgers of all transactions. There are a number of cryptocurrencies traded in markets, and the growing popularity means that despite volatile prices, market caps and values are growing every year. Popular cryptocurrencies include the original Bitcoin, Ethereum and Litecoin. Cryptocurrency is legal and taxable in the US and OECD countries, but it isn’t legal tender (you can’t pay your taxes in Bitcoin). With that said, due to its infancy and history so far, cryptocurrencies should be invested in and used with their historical volatility in mind.

The Different Types of Cryptocurrencies

Although there are technically over 1000 cryptocurrencies, only a handful are relevant. Of those, even less have a market cap above $1 million. Below is a list of important cryptocurrencies and additional resources you can use to learn more about all the different cryptocurrency types.

Bitcoin

As expected, the Bitcoin is in the top of the list with the biggest market capitalization of all cryptocurrencies . It was invented by Satoshi Nakamoto (some beleive that Satoshi was actually not one person but a group of IT / banking specialists) at the time, it was the only virtual currency available in the market.

Ethereum

Is probably the third most important coin, if not the second. It doesn’t have the longevity at the top like Litecoin, but it is built on a system that other coins are built on. Most ICOs (Initial Coin Offerings) use ethereum. It has a less intimidating cost that Bitcoin, and has the second highest market cap.

BitcoinCash

BitcoinCash is a spin-off of bitcoin, meant to have faster transactions, voted on and implemented by the Bitcoin community. It is too early to call, but this coin has a high market cap and could shape up to be a top player.

Litecoin

It’s also an open source pear-to-pear digital currency same like Bitcoin. Some people would say “a Litecoin is like a Bitcoin except with a value closer to what a reasonable person would expect a digital coin to have in a rational market.”

Other honorable mentions

Ripple, BitShares, Rise, NEO, NEM, Monero, and a few others all have decent values, familiarity, and respectable market caps. Some even have better exchange rates currently then our top picks for coins. So, make sure not to dismiss the other forerunners (or even some odd altcoins with interesting code). We could easily see one a given existing altcoin or even a new coin spring up to the top of the list at any moment. The cryptocurrency market is young and volatile if you haven’t caught on to that already.