Cryptos Of Distinction

Folks throw around the word "crypto."

But they are NOT all the same...

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There are now more than 17,000 cryptocurrencies in existence.

And almost 1,000 new ones are added every month.

Yet within this sea of madness, roughly 20 cryptos comprise 90% of the total market value.

As my content shop has been marketing some truly complex crypto-projects, something has become clear. The real crypto-nerds recognize one key factor that the "average joe" does not. In fact, this is the very REASON for all the different cryptos.

So this overview is not a "Top 10" group aggregation.

Rather, it's a parsing of the key differences between all these assets. I have nothing to sell you. The goal here is to help everyone develop a proper understanding.

UTILITY

To truly grasp cryptocurrency, you must begin with their utility. Same can be said for NFT's and Social Tokens but we'll revisit that some other day.

The massive number of cryptocurrencies?can actually be grouped by their utility.?Think of it basically as: "What's it for?...”

Each cryptocurrency has its own technology.

Because each has a unique vision of how the crypto space should be developed.?

Thus, each has its own specific appeal to buyers.

In business terms, we’d say that they each have a different value proposition in the marketplace.

That sounds like nuance.

Yet it’s an important distinction that many people do not understand. Using market-capitalization as our guide, here are the differences between the most?well-known cryptos:

?TOP 10

1 - Bitcoin - The first cryptocurrency and the largest by market cap.

It is viewed as a stable store of value due to its universal acceptance. It is primarily used as an alternative method for storing wealth. It was designed with an intentionally slow processing of transactions. This slow capacity means that it is not ideal for use in everyday buying and selling as a currency.

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2 - Ethereum – The first programmable blockchain.

This enables developers to build decentralized apps (dApps) that can transact in things OTHER than just currency. Thus, Ethereum has become the foundation of things like NFTs, GameFinance and real estate tokenization. While it has faster transaction times than Bitcoin, Ethereum is far from the fastest in processing speed. Ethereum’s strength really lies in its use-cases beyond just currency.

3 - Tether - A stablecoin whose price follows the U.S. dollar.

This pegging feature removes the everyday volatility of most cryptocurrencies. This stability has resulted in Tether becoming the cryptocurrency with the most trading volume.

4 - Cardano – Cardano’s mining process is more efficient than any other crypto.

This makes it more environmentally friendly. Due to its low energy usage, it’s considered a “sustainable" digital coin. It's blockchain also enables decentralized apps, similar to Ethereum, so it too can handle things other than currency.

5 - Binance Coin – Built by the popular Binance exchange.

This coin has greater utility in the real world.?Binance is a centralized company, so its coin can be used for mainstream activities inside traditional Finance, such as credit card payments, trading and lending.

6 - XRP – This cryptocurrency is known for its incredibly fast transaction speed.

Many major banks and financial centers use the XRP network for digital payments. This XRP network is owned and operated by a private company called Ripple, which was the subject of an SEC lawsuit, categorizing XRP as an unregistered security.

7 - Polkadot - A cryptocurrency designed to allow different blockchains to communicate and work with each other as “parachains.”

Connecting across blockchains allows entirely new functionality. This capability puts it in competition with the smart-contracts of Cardano and Ethereum.

8 - Solana?- Another smart-contract crypto – but faster.

Solana can process transactions quicker and cheaper than rivals like Ethereum. Theoretically, Solana is capable of 65,000 transactions every second versus Ethereum’s 15 transactions-per-second. Both of these dwarf Bitcoin’s 7 transactions-per-second.

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9 - Dogecoin - The first meme-coin to gain widespread popularity.

It shares many of the same technical characteristics as Bitcoin, since much of its coding was directly copied from the first cryptocurrency. However, Dogecoin’s notoriety has increased its network and thus it's acceptance among an increasing number of vendors.

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10 - Monero - A cryptocurrency that provides greater privacy by making transactions untraceable.

Cryptos like Bitcoin have a public wallet address, giving visibility into how much crypto is held in that wallet. Monero prevents this with privacy features applied to every transaction. This effectively masks transactions and visibility into wallets. There is debate as to whether this promotes illicit activity or protects the privacy of citizens. But both are true.

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HONORABLE MENTIONS

Stellar – a crypto focused on enabling inexpensive transactions for under-developed areas of the world.

Litecoin – fast and cheap with the goal of being useable in everyday, small transactions.

Bitcoin Cash - a fork of Bitcoin with larger block sizes, faster transaction times and more scalability – thus making it more suitable as a bitcoin currency.

Chainlink?- It does not feature its own blockchain but simply links smart-contracts with off-chain information sources like data providers and APIs.?

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KEY TAKEAWAY

It is not possible to create a definitive list because things change quickly. But the reality is that each crypto continues developing in technology advancements.

Your big takeaway is to recognize that the slight differences in their intent is the key to understanding crypto. And that is why there are so many cryptocurrencies.

THE FUTURE

It is likely that a dominant few will eventually emerge as the established marketplace. These will then become the prevailing cryptocurrencies - again as defined by their utility. But at the moment, the world of digital currency is still rapidly evolving. Expect this for the foreseeable future.

But remember - when anyone mentions "crypto" anything.....stop and focus on the factor of utility. That will shine a light on everything else you need to know about it.

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MARC C. ANGELOS

After 3 decades as a Wall Street FinTech sales leader, Marc founded a content marketing firm.?Through Anvictus Communication, Marc designs business strategy for fast-growing blockchain, Web3 and FinTech companies. Marc has published several hundred articles and videos outlining how to build client trust and increase revenue through content. His work has been featured in media such as CNBC, Bloomberg, Informa, Traders Magazine, FX Algo News, The Tilt, TabbFORUM, Sidecar Global, GreenFig and multiple business podcasts.

[email protected]