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CryptoCurrency

cryptocurrency (or cryptocurrency) is designed to work as a medium of exchange to secure financial transactions, control the creation of additional units, and verify the transfer of assets. A defining feature of cryptocurrencies is that they are generally not issued by any central authority, rendering them theoretically immune to government interference or manipulation.

cryptocurrency is a binary data designed to work as a medium of exchange wherein each coin transaction records are stored in a ledger existing in the form of a database using strong publicly available cryptography to secure transaction records, to control the creation of additional coins, and to verify the transfer of coin ownership. Some crypto schemes use validators to maintain the cryptocurrency. Cryptocurrency does not exist physically (like paper money) and is typically not issued by a central authority. Cryptocurrencies typically use decentralized control as opposed to a central bank digital currency (CBDC). When implemented with decentralized control, each cryptocurrency works through distributed ledger technology, typically a blockchain, that serves as a public financial transaction database

Internet based

Cryptocurrency is an internet-based medium of exchange that uses crypto-graphical functions to conduct financial transactions. It leverage blockchain technology to gain decentralization, transparency, and immutability.

Decentralized

The most important feature of a cryptocurrency is that it is not controlled by any central authority: the decentralised nature of the blockchain makes crypto currencies theoretically immune to the old ways of govt control and interference.

No Institutions

Cryptocurrencies can be sent directly between two parties via the use of private and public keys.  These transfers can be done with minimal processing fees, allowing users to avoid the steep fees charged by traditional financial institutions.

"There are now more than 3000 cryptocurrencies in existence, with each falling into one of the three major categories: altcoins, tokens, and Bitcoins"

Here, we will explain the differences between these cryptocurrencies. We will also look at some common subtypes used for cryptocurrencies, such as ‘stablecoins’ and ‘privacy coins’. After reading this, you should understand all the significant types of crypto and differentiate between them easily. Let’s get started!

The Three main types of Cryptocurrency:

   BitCoin

Bitcoin (BTC) was the first cryptocurrency to be created and remains the world’s leading cryptocurrency by market cap. Bitcoin is a global peer-to-peer electronic payment system that allows parties to transact directly with each other without the need for an intermediary or institution such as a government or any bank. The Bitcoin whitepaper, which outlined how this revolutionary new currency would work, was released in 2008, and the Bitcoin network launched in 2009. Since its launch, Bitcoin has experienced no downtime, allowing anyone to transfer value at any time and from anywhere. The transaction time has also improved a lot in recent years. Bitcoin’s creator goes by the pseudonym, Satoshi Nakamoto. Their real identity remains unknown to this day. It is also unclear whether Nakamoto represents a single person or a group of individuals who worked on the Bitcoin project. Bitcoin is often regarded as the digital alternative to both fiat currencies and gold. That is because Bitcoin can be spent and saved just like traditional money, but is also a scarce finite resource and thus a good store of value like gold.

   AltCoins

The release of the Bitcoin whitepaper & its open-source code in 2008 laid the foundation of a new universe where thousand of a new world was yet to be founded. So, we got thousands of other cryptocurrencies and similar coding marvels to be created. These new coins are termed ‘alternative coins’ or ‘altcoins’ as an alternative to Bitcoin. While some has identical purpose to Bitcoin, other cryptocurrency types such as altcoins encompass a wide range of different uses. For example, Ethereum (ETH), the world’s first programmable blockchain, enables developers to build and deploy decentralised applications (DApps) and smart contracts.

There are at least 11,000 altcoins in existence(as of 11th September 2021), according to data from CoinMarketCap, and the top 5 altcoins by market cap are Ethereum, Ripple (XRP), Bitcoin Cash (BCH), Litecoin, and EOS.IO (EOS). Like Bitcoin, all altcoins can operate independently on their networks utilising publicly accessible distributed ledger technology (DLT). Blockchain technology is the most famous and commonly used type of DLT, introduced to the world by still unknown Satoshi Nakamoto via Bitcoin. While all coins use DLT, slight variations in the whitepaper, i.e. underlying code of each protocol, are what gives altcoins their unique attributes.

IOTA is specifically designed to be a new data transfer and transaction settlement layer for the machine economy and the Internet of Things (IoT).

IOTA also uses its proprietary distributed ledger technology called the Tangle.  Litecoin (LTC) is a peer-to-peer currency and global payment network similar to Bitcoin. Litecoin’s creator Charlie Lee states that his intention was for Litecoin to be a complementary cryptocurrency to Bitcoin.

   Tokens

Unlike Bitcoin and Altcoins, tokens cannot operate independently. They're dependent on the network of another DLT, such as cryptocurrency. They do not have their underlying blockchain product but instead are built on top of an existing cryptocurrency's blockchain. Data from CoinMarketCap shows that at least 1496 tokens exist, deployed on the blockchain platforms of 36 cryptos. Here are few examples of different types of cryptocurrencies that host tokens include:

Tokens are easier to create as building a blockchain from scratch is not needed. “Tokenise the world” means the ability of tokens to represent almost any asset. Tokenisation of stocks, commodities, fiat currencies, other cryptocurrencies, property, etc., have already been achieved. Trust me, we have barely even scratched the surface yet as to what else can be tokenised. 

   Token Types

The top 5 tokens by market cap are Tether, UNUS SED LEO, Chainlink, Huobi Token, and Maker, all of which are deployed on the Ethereum blockchain apart from Tether which takes the top spot.

ETHEREUM

The Ethereum platform has by far the most tokens deployed on it. Tokens that run on Ethereum include Basic Attention Token (BAT), Chainlink (LINK), Huobi Token (HT), USD Coin (USDC), and hundreds of others.

NEO

NEO is often referred to as the Chinese rival to Ethereum, and as a platform for smart contracts and DApps, it has many tokens deployed on it. Top examples of NEO tokens include Nash Exchange (NEX) and Gas (GAS).

OMNI

Tether (USDT), the leading stablecoin and world’s most traded cryptocurrency, is a token that is deployed on Omni, along with three other tokens.

TRON

TRON is a leading platform for DApps & has numerous tokens deployed on it, including BitTorrent Token (BTT), which is used for faster downloads file-sharing protocol.

   Common terms used to categorize cryptocurrencies

While we are on the topic of different types of cryptocurrency, we may as well look at some of the various subtypes that you will likely come across in the crypto world. Here are four terms commonly used to categorise cryptocurrencies that have specific characteristics:

Privacy Coins

Cryptocurrencies that focus on providing private transactions, such as Monero, Zcash, and Dash.

Stable Coins

Cryptocurrencies that are pegged to ‘stable’ assets such as fiat currencies to reduce price volatility dramatically. Prime examples include Tether, Dai, USD Coin, and Paxos.

Exchange Tokens

Cryptocurrencies created by crypto exchanges to be used primarily on their own trading platform and services. Prime examples include Binance Coin, Huobi Token, and KuCoin. 

CBDC

Cryptocurrencies that are created or backed by a central bank. The People’s Bank of China (PBoC) is currently developing its digital yuan, and it is expected that most countries will digitise their national currencies in the future.

History of Cryptocurrency

In 2008, an anonymous programmer or a group of programmers under the alias Satoshi Nakamoto introduced the Bitcoin whitepaper. Satoshi described it as a 'peer-to-peer electronic cash system.' Its beauty was an utterly decentralised control, meaning no servers were involved and no supreme controlling authority or government. The concept posses several resembles with peer-to-peer networks for file sharing. Millions believe that cryptocurrency is the hottest investment opportunity available. There are stories of people becoming millionaires through their Bitcoin investments. Bitcoin is the most recognisable digital currency to date, and this year on 14th April, one BTC was valued at Rs.48,29,253/-. Ethereum is the second most valued cryptocurrency, has recorded the fastest rise a digital currency ever demonstrated. In Feb 2017, it was valued at Rs.773 & in May 2021, it was Rs. 3,06,000/- It's value has increased by at least 40,000 per cent. When it comes to all cryptocurrencies combined, their market cap soared by more than 30,000 per cent since mid-2016.

Legality of Cryptocurrency

Cryptocurrencies are mainstream now! Govt. & other Law enforcement agencies are figuring out the concept of crypto coins and where they fit in existing financial regulations and legal frameworks. With the introduction of Bitcoin, a completely new paradigm was created. Decentralised, self-sustained digital currencies not controlled by any singular entity that doesn’t exist in any physical shape or form were always set to cause an uproar among the regulators. Many concerns have been raised regarding cryptocurrencies’ decentralised nature and their ability to be used almost completely anonymously. The authorities worldwide are worried about the cryptocurrencies’ appeal to the traders of illegal goods and services as their use in money laundering and tax evasion schemes can rise. As of September 2021, Bitcoin and other digital currencies are outlawed only in Algeria, Bolivia, China, Colombia, Egypt, Indonesia, Iran, Nepal, North Macedonia, Russia, Turkey and Vietnam. Other jurisdictions, however, do not make the usage of cryptocurrencies illegal, but the laws and regulations can vary drastically depending on the country.

Types of Cryptocurrencies:

You won't be able to count the number of cryptocurrency currently circulating in market. There are numerous organisation and group of people keeps on launching a new Currency every day. Some of the currency that are recognised globally are: 

Bitcoin

Bitcoin is a cryptocurrency. It is a decentralised digital currency without a central bank or single admin that can be sent from user to user on the peer-to-peer bitcoin network without the need for intermediaries.

Ledger start: 3 January 2009
Supply limit: ₿21,000,000
Release: 0.1.0 / 9 January 2009 
Founder: Satoshi Nakamoto
Symbols: BTC, ฿, ₿

ISO 4217 codes: BTC, XBT

Ethereum

Ethereum is an open source, public, blockchain-based distributed computing platform and operating system featuring smart contract functionality. It supports a modified version of Nakamoto consensus via transaction-based state transitions.

Initial release date: 30 July 2015
Software used: EVM 1 Bytecode
Release: Muir Glacier / 1 January 2020
Total users: 91,994,515 (2020-03)
Developer(s): Ethereum Foundation

Original authors: Vitalik Buterin, Gavin Wood

Ripple

Ripple is a real-time gross settlement system, currency exchange and remittance network created by Ripple Labs Inc., a US-based technology company.

Stable release: 1.0.0 / 15 May 2018
Developed by: Ripple Labs
Operating system: Linux 
(RHEL, CentOS, Ubuntu), 
Windows, macOS (development only)
Founder: Chris Larsen
Original author(s): Arthur Britto, David Schwartz, Ryan Fugger

Initial release: 2012

BITCOIN CASH

Bitcoin Cash is a cryptocurrency that is a fork of Bitcoin. Bitcoin Cash is a spin-off or altcoin that was created in 2017. In 2018 Bitcoin Cash subsequently split into two cryptocurrencies: Bitcoin Cash, and Bitcoin SV. Bitcoin Cash is sometimes also referred to as Bcash.

Split height: #478559 / 1 August 2017
Split ratio: 1:1
Block reward: 6.25 BCH
Ledger start: 3 January 2009 (11 years ago)
Supply limit: 21,000,000 BCH

Latest release: 0.19.10 / 25 July 2019

NEM

NEM is a peer-to-peer cryptocurrency and blockchain platform launched on March 31, 2015 written in Java.

Genesis Block Production: Fixed 8,999,999,999 XEM total
Date of introduction: 31 March 2015
Symbol: XEM
User(s): Global
Issuer: Fixed Decentralized; peer-to-peer consensus
Programming languages: Java, C++, Qt

Litecoin

Litecoin is a cryptocurrency released under the MIT/X11 license. Creation and transfer of coins is based on an open source cryptographic protocol and is not managed by any central authority. Litecoin was an early bitcoin spinoff or altcoin, starting in October 2011.

Symbol: Ł
Project fork of: Bitcoin
Supply limit: 84,000,000 LTC
Circulating supply: 62,424,175 LTC (26/06/2019)
Initial release: 0.1.0 / 7 October 2011;

Hash function: scrypt

IOTA

Almost before we knew it, we had left the ground. All their equipment and instruments are alive.

NEO

Almost before we knew it, we had left the ground. All their equipment and instruments are alive.

Dash

Almost before we knew it, we had left the ground. All their equipment and instruments are alive.

Qtum

Almost before we knew it, we had left the ground. All their equipment and instruments are alive.

Monero

Almost before we knew it, we had left the ground. All their equipment and instruments are alive.

Ethereum Classic

Almost before we knew it, we had left the ground. All their equipment and instruments are alive.

The Crypto's Story

Come out of Stone Age and know the moves

How to Buy?

There are a lot of different options when it comes to buying Bitcoins. For example, there are currently almost 1,800 Bitcoin ATMs in 58 countries. Moreover, you can buy BTC using gift cards, cryptocurrency exchanges, investment trusts and you can even trade face-to-face.

When it comes to other, less popular cryptocurrencies, the buying options aren’t as diverse. However, there are still numerous exchanges where you can acquire various crypto-coins for flat currencies or Bitcoins. Face-to-face trading is also a popular way of acquiring coins. Buying options depend on particular cryptocurrencies, their popularity as well as your location.

How to Store?

Cryptocurrencies are digital, which entails a completely different approach, particularly when it comes to storing it. Technically, you don’t store your units of cryptocurrency; instead it’s the private key that you use to sign for transactions that need to be securely stored.

There are several different types of cryptocurrency wallets that cater for different needs. If your priority is privacy, you might want to opt for a paper or a hardware wallet. Those are the most secure ways of storing your crypto funds. There are also ‘cold’ (offline) wallets that are stored on your hard drive and online wallets, which can either be affiliated with exchanges or with independent platforms.

Knowledge base

What is Bitcoin?

Bitcoin is a cryptocurrency first introduced on October 31 2008 with a computer science paper that described how it would work. A few months later, on January 3, 2009, the code was released and the first bitcoins appeared.


Bitcoin is often compared to gold in that there is a limited supply — the maximum number of bitcoins that will ever enter circulation is 21 million. Unlike gold, however, bitcoin is digital, making it far easier to divide, transfer, and store.

When is the best time to sell cryptocurrency?

When making a decision on when to sell (or not), you’ll need to consider things like your finances, your tolerance for risk, the tax consequences, and why you bought crypto. As you figure out the answers, what you’ll find is that your situation — like everyone’s situation — is unique, which means there is no universal “best” time to sell cryptocurrency.

How do I sell cryptocurrency?

Selling on an exchange is typically easy. If you already hold your cryptocurrency on some trading platform, you just visit the sell page, enter the amount you want to sell, confirm, and finish.

When can I sell my cryptocurrency?

Unlike the stock market, crypto markets never close. You can sell cryptocurrency at any time — it’s completely up to you. If you’re a customer in Canada, Australia, or Singapore, it’s important to know that you can currently buy crypto but not sell it. We hope to add the ability to sell crypto in these countries soon.

What is cryptocurrency mining?

Mining is the process of validating other people’s transactions with a computer and then adding them to the long, public list of all transactions known as the blockchain. In exchange, people get rewarded with cryptocurrency.


Anyone with a computer and an internet connection can become a miner. But before you get excited, it’s worth noting that mining is not always profitable. Depending on several factors, such as which cryptocurrency you’re mining, how fast your computer is, and the cost of electricity in your area, you may end up spending more on mining than you earn back in cryptocurrency.

When is the best time to buy cryptocurrency?

If you’re buying cryptocurrency to spend it, gift it, or donate it, then you’ll want to buy it before you plan to use it. When is the exact best time? Like many financial decisions, it depends on a lot of factors: which cryptocurrency you’re buying, the reason you’re buying it, your personal financial situation, and the current state of the overall cryptocurrency market — just to name a few.


We recommend being skeptical of articles or social media posts that claim to know which cryptocurrency to buy or when to buy it. The authors may have a personal interest in affecting the price of a cryptocurrency they recommend. Instead, always do your own research or seek help from an accredited financial advisor to decide which cryptocurrency to buy and when.

Are cryptocurrencies anonymous?

Generally, no. Although a few cryptocurrencies are genuinely anonymous, the vast majority (including Bitcoin and Ethereum) are not.


With these cryptocurrencies, all transactions are publicly available, and experts can generally use this information — along with sophisticated software — to trace transactions back to the original owners.


It’s also worth noting that Crypto Trading platforms requires ID verification to withdraw cryptocurrencies. This helps prevent fraud and is one of the many reasons why Cryptocurrencies is considered a trustworthy.

What’s the best way to store cryptocurrency?

Storing crypto is similar to storing cash, which means you need to protect it from theft and loss.


As part of our commitment to customer security, we leads the industry by holding 98% of its cryptocurrency in offline storage that is encrypted and copied to drives and paper backups that are distributed in safe deposit boxes and vaults around the world. If that sounds like a lot of work, that’s because it is. Our #1 priority is to be the most trusted cryptocurrency platform, which means our security practices are continually evolving as we evaluate and adjust our approach to address the ever-changing security landscape.

Do I have to buy a whole coin?

This one’s easy — you do not need to buy a whole coin. You can buy in increments as little as 2 dollars, euros, pounds, or your local currency.

Why do experts like cryptocurrencies?

Experts often talk about the many ways crypto can address the shortcomings of our current financial system. Things like high fees, identity theft, and extreme economic inequality are an unfortunate part of our current financial system and they’re also things crypto has the potential to address.

How can crypto make the world better?

Cryptocurrencies have the potential to make the world better by letting any two people in the world exchange money directly, without involving a financial institution or government. This will mean more equality of opportunity for those without access to traditional financial services, like bank accounts and credit cards.


In addition, the blockchain technology that makes cryptocurrencies possible is being used in novel new ways to improve the world. Examples include blockchains that help verify identity, manage healthcare records, validate ownership, and even accelerate research on diseases like cancer, Alzheimer’s, and tuberculosis.

What is Bitcoin?

Bitcoin is a cryptocurrency first introduced on October 31 2008 with a computer science paper that described how it would work. A few months later, on January 3, 2009, the code was released and the first bitcoins appeared.


Bitcoin is often compared to gold in that there is a limited supply — the maximum number of bitcoins that will ever enter circulation is 21 million. Unlike gold, however, bitcoin is digital, making it far easier to divide, transfer, and store.

What are the different Cryptocurrencies?

Bitcoin is the oldest and most well-known cryptocurrency, but there are hundreds of others. Some cryptocurrencies, like Litecoin and Bitcoin Cash, share Bitcoin’s core characteristics but explore new ways to process transactions. Others offer a wider range of features. Ethereum, for example, can be used to run applications and create contracts.

Where do cryptocurrencies get their value?

The economic value of cryptocurrency, like most goods and services, comes from supply and demand. Supply refers to how much is available — like how many Bitcoin are available to buy at any moment in time. Demand refers to people’s desire to own it — as in how many people want to buy Bitcoin and how strongly they want it. The value of a cryptocurrency will always be a balance of both factors.


There are also other types of value. For example, there’s the value you get from using a cryptocurrency. Many people enjoy spending or gifting crypto because it gives them a sense of pride to support an exciting new financial system. Similarly, some people like to shop with Bitcoin because they like its low fees and want to encourage businesses to accept it.

What is a blockchain?

At its most basic, a blockchain is a list of transactions that anyone can view and verify. The Bitcoin blockchain, for example, is a record of every time someone sent or received bitcoin.


This list of transactions is fundamental for most cryptocurrencies because it enables secure payments to be made between people who don’t know each other without having to go through a third party verifier like a bank.

Why is Cryptocurrencies Exciting?

Cryptocurrency has the potential to be the fastest, easiest, cheapest, safest, and most universal way to exchange value that the world has ever seen.


And if that’s not exciting enough, crypto also provides equality of opportunity, regardless of where you were born or where you live. As long as you have a smartphone or another internet-connected device, you have the same access to cryptocurrency as everyone else.

What can I do with cryptocurrency?

Besides buying and selling cryptocurrency, you can…

  • Shop: Over 100,000 merchants accept Bitcoin including Microsoft, Overstock, and NewEgg.

  • Dine out: Worldwide, you can dine in or carry out at thousands of restaurants using Bitcoin or Bitcoin Cash.

  • Donate to causes: GiveCrypto.org is a nonprofit that distributes cryptocurrency to people living in poverty. The Internet Archive, The Mozilla Foundation, and The Wikimedia Foundation (just to name a few) also all accept donations in Bitcoin.

  • Gift it: Cryptocurrency makes a great gift for friends and family.

  • Tip someone: Authors, musicians, and other online content creators sometimes leave Bitcoin addresses or QR codes at the end of their articles. If you like their work, you can give a little crypto as a way of saying thanks.

  • Travel the world: Because cryptocurrency isn’t tied to a specific country, traveling with crypto can cut down on money exchange fees. There’s already a small but thriving community of self-titled “crypto nomads” who primarily, or in some cases exclusively, spend crypto when they travel.

Is cryptocurrency legal?

Yes, crypto is legal to buy, sell, send, receive, and own in most parts of the world. The full list of countries we support includes the USA, UK, Australia*, Canada*, Singapore*, and the following countries in Europe:

Austria  Czech Republic Ireland Monaco San Marino
 Belgium DenmarkItaly  Netherlands Slovakia
 Bulgaria Finland Latvia Norway Slovenia
 Croatia Greece Liechtenstein Poland Spain
 Cyprus Hungary Malta Portugal Sweden
Switzerland

In some countries there is still a lot of confusion in trading so countries like Canada, Australia, and Singapore currently allows you to buy crypto but not sell it.

Which cryptocurrency should I buy?

 You can buy Bitcoin (BTC), Litecoin (LTC), Ethereum (ETH), Bitcoin Cash (BCH), and Ethereum Classic (ETC). While we can’t recommend one currency over another, we can still share a few approaches that can help you decide which crypto is right for you.

One simple option is buy some of each currency. It’s a straightforward way to get started without playing favourites.

Another good option is to ask yourself what you’re hoping to do with crypto and choose the currency that will help you achieve your goals. For example, if you want to buy a T-shirt with crypto, then Bitcoin might be a good option because it is the most widely accepted cryptocurrency. On the other hand, if you want to play a digital card game, then Ethereum is a popular choice.

How is cryptocurrency different from regular money?

Cryptocurrencies and regular money share some traits — like how you can use them to buy things or how you can transfer them electronically — but they’re also unique in interesting ways. Here are a few highlights.