Home GuidesCryptocurrency

Follow us on Twitter or join our Telegram

How do cryptocurrencies differ?

The main differences relate to how coins are produced and spent.

Some coins, like Bitcoin, Dash and Monero, are created in a process called “mining” which involves using powerful computers to solve complicated cryptographic puzzles. When a puzzle is solved, the system rewards the winning “miner” with coins (bitcoins, dash coins, etc.). The miner can then sell the coins in the market.

Other coins, like NEM (XEM), have other types of algorithms that don’t require powerful hardware. And then there are currencies such as ripple and IOTA that can’t be mined – they’re produced by an organization that stands behind the currency.

When it comes to spending, Bitcoin is the cryptocurrency that enjoys the widest acceptance among merchants and service providers. Others, like Litecoin and Dash, are working on giving their holders new spending possibilities. But daily use – buying coffee, clothes and so on – is not the primary goal of some coins. Ether, for example, is meant to be used to pay for the services of the blockchain-based Ethereum platform, to create and use applications on it.

Other important differences are the privacy and transaction speed that a cryptocurrency offers. At the moment, transactions in Bitcoin are slower and less anonymous, than, say, those in dash or monero. But Bitcoin could add features to increase its privacy and speed in the future, especially since it currently boasts the biggest developer ecosystem.

Previous - What is cryptocurrency?
Next - Can I create my own cryptocurrency?

Have any suggestions about this entry?Let us know here.

More Guides

Cryptotag Zeus Review (2021)

Cryptotag Zeus seed backup plate is a must-have for every serious hodler. If you are preparing to take your crypto coins out of exchanges or already store them in a private hardware wallet, the importance of a proper backup set up should not be...

Read more

What Is Yield Farming?

Often associated with risky ventures with crazy returns, yield farming has been generating quite a buzz. With Ethereum’s recent...

Read more

Top 10 Decentralized Exchanges (DEX) in 2021

If you’ve been trading for crypto, you’ve probably been using centralized exchanges like Binance or Huobi. As of now, using a...

Read more

What is DeFi? Decentralized Finance Explained

Do we know what happens within the central banks and massive financial institutions that dictate our financial lives? Is there a recorded history of all their transactions that we can look up at will? This doesn’t seem to be the case. We...

Read more

Trezor Model T Review (2021) - Should You Buy It?

If you want to keep your cryptocurrency secure, a crypto hardware wallet is a way to go. But which one should you choose? In this article, we review Trezor Model T - one of the most advanced multi-currency hardware wallets out there.

Read more

Crypto.Games Review (2021): Simple & Fun Crypto Casino

Are you looking to game with the added security and privacy that cryptocurrencies offer? Crypto.Games is your best bet: with fast transactions and old-school games sure to give you nostalgic flashbacks, here you will find eight provably fair games...

Read more