By Manaal Khan
Hi all and welcome to another helping of money matters. In this post I’m going to present a new (for most of you) and interesting topic! Yes, you read the title right, e-currencies and their importance in the world of finance! As the world is turning digital, let’s look at some of the top 10 e-currencies other than Bitcoin. Before we start, let me give a brief introduction about Bitcoin; Bitcoin is a decentralised virtual currency that can be bought, sold, and traded without the use of a broker such as a financial institution. It was Satoshi Nakamoto, Bitcoin’s developer, who first acknowledged the requirement for ;an electronic payment system based on cryptographic proof instead of trust; Well done, him, I say. Every other Bitcoin transaction that has ever been made is recorded on a ledger that is open to the public, enabling payments impossible to reverse and counterfeit because of its decentralised structure. Bitcoins are not backed by a government or any licensing organisation, and their worth is only guaranteed by the evidence encoded into the system.
Now we’ve got that out of the way, let’s dig a little deeper and look into some of the most important digital currencies other than Bitcoin.
Cardano
Engineers, mathematicians, and cryptography professionals collaborated to build Cardano, an Ouroboros cryptocurrency. Charles Hoskinson, one of Ethereum’ five founders, was one of the operation’s co-founders. He quit Ethereum after various issues with its direction, later helping to build Cardano. Its blockchain was developed after intensive testing and a peer-reviewed study by the Cardano team, where more than 90 papers on blockchain technology were published by the project’ researchers on a variety of issues. Cardano’s mission is to become the world’ financial operating system by creating decentralised investment instruments akin to Ethereum, and delivering solutions for chain compatibility, illegal voting, and legal contract monitoring, among several other issues. Cardano has a market capitalisation of $57 billion as of November 2021, and one ADA currently trades for roughly $1.79.
Stellar
The Stellar Development Foundation, a non-profit organisation formed by Jed McCaleb, runs Stellar. The Stellar initiative was initially supported by Stripe, a transactions firm, as well as contributions from Google, BlackRock, and FastForward. The group receives tax-deductible donations made by the public to pay its operating expenditures. In 2018, Stellar partnered with TransferTo to offer cross-border payments to over 70 countries. It was also chosen as a collaborator by IBM for a double-pegged cryptocurrency program becoming the first open digital platform to receive a Shariah-compliance license for transactions and property tokenisation. Stellar’ main mission is to develop nations in the fields of remittance and bank borrowings to those who have no access to financial services. Users and organisations are not charged to use the Stellar network. Stellar also supports a decentralised exchange method. This enables users to make transactions in a one currency even if they have credits in another, and the network handles the currency exchange for them. A partnering institution, such as a financial institution, can provide the client with their monetary equivalent.
Etherium
Etherium is a decentralised programming service that allows smart contracts and decentralised programmes (dapps) to be written and operated without any need for third-party intervention, downtime, theft, or governance. Ethereum’ goal is to establish a decentralised array of financial goods that anybody in the world, regardless of ethnicity, religion, or nationality, can freely accessThis element heightens the ramifications for those in some nations, as those lacking accessibility to governmental infrastructure and identity can obtain bank accounts, loans, insurance, and several other financial items. Ethereum applications are powered by ether, the platform’ proprietary cryptographic token. Ether serves as a mode of transport on the Ethereum network, and it is primarily sought by developers who want to build and run apps on the network, as well as investors who want to buy other cryptocurrencies. Ether’ market valuation is less than half that of Bitcoin, trading at roughly $4,000 per ETH as of November 2021.
Litecoin
Litecoin, which debuted in 2011, was one of the first digital currencies to follow in Bitcoin’ footsteps, and has been dubbed the “silver to Bitcoin’s gold”. Charlie Lee, a former Google engineer and MIT graduate, designed it, and it’s based on the open global payment network that isn’t centralised and employs as a proof of work that can be decrypted with consumer-grade CPUs. Though Litecoin is similar to Bitcoin in many ways, it has a quicker block creation rate and thus a faster confirmation time for transactions. A growing number of retailers, in addition to developers, accept Litecoin. Litecoin does have a market capitalisation of $14 billion with a per value of roughly $200 as of November 2021, putting it the world’ seventeenth-largest cryptocurrency.
Binance Coin
Binance Coin is a virtual currency that was created by the Binance exchange and is traded under the symbol BNB. Binance Exchange is the world’ largest virtual currency exchange as of June 2021, with over 1.4 million transactions per second. Binance was founded in 2017 as a utility token with lower trading fees. However, since then, it has been used in a variety of applications on a variety of platforms. It is used to pay for Binance.com, Binance DEX, and Binance Chain transaction fees. Binance coins can also be used to invest in some ICOs listed on Binance’ Launchpad programme. Binance is a smooth marketplace for trading in a range of new and established digital tokens. New digital currencies are listed on the Binance exchange, and using Binance provides a seamless platform for trading in a number of existing and new digital tokens.
Dogecoin
The price of Dogecoin, dubbed the “original memecoin” by some, increased in 2021, causing quite the commotion. The coin, whichhas a Shiba inu as its avatar, is considered as a means of payment by several big businesses, along with the Dallas Mavericks, Kronos, and, perhaps most importantly, SpaceX: Elon Musk’ American aerospace company. Billy Markus and Jackson Palmer, two software programmers, founded Dogecoin in 2013. Markus and Palmer are said to have developed the coin as a prank in response to the cryptocurrency market’ rampant speculation. During the week that Elon Musk was set to appear on Saturday Night Live, the price of DOGE reached an all-time high of $0.71. Dogecoin has a market valuation of $29.2 billion as of November 2021, and one DOGE is worth roughly $0.22, making it the tenth-largest cryptocurrency.
Tether
Tether was among the first and also most famous of a class of digital currencies known as stablecoins, which try to decrease volatility by pegging their market value to a currency or other external reference point. Tether and other stablecoins seek to level out price variations to reach customers who might otherwise be wary of digital currencies, especially significant ones like Bitcoin, which have suffered repeated bouts of severe volatility. The price of Tether is directly linked to the price of the US dollar and it enables users to make transactions from other digital currencies to US dollars in a fraction of the time it takes to convert to regular currency. Tether, with a total market capitalisation of $73.7 billion and a per token value of $1, exactly one dollar! is the fifth-largest virtual currency by market capitalisation as of November 2021.
Polkadot
Gavin Wood, one of the Ethereum project’s main developers had conflicting perspectives on the program’s future,and so he launched Polkadot. Polkadot is a one-of-a-kind proof-of-stake coin that aims to provide collaboration between different blockchain systems. Its technology connects allowed and permissionless blockchains and oracles that allows a number of institutions to collaborate underneath one roof. Polkadot’s essential component is its relay chain, which enables network compatibility. For certain scenarios, it also permits “parachains” or alternative blockchains to use their own native currency. Polkadot differentiates from Ethereum in that instead of constructing just independent programmes on the platform, designers can establish their blockchain while still benefiting from the protection offered by Polkadot’s chain. Designers can also establish new blockchains with Ethereum. That’s right, but in order to start personal blockchains, they must implement their own unique security mechanisms, which could expose new and minor projects to damage, as the larger a blockchain is, the more secure it is. Polkadot refers to this concept as “shared security.”
Monero
Monero is a virtual currency that provides its users and their transactions with the maximum level of security. Monero is a decentralised peer-to-peer virtual currency similar to Bitcoin, however, it is regarded as a more untraceable or confidential digital cash than Bitcoin. Monero facilitates openness by relying on the choice of its consumers. Each client has a “view key” that can be used to gain access to an account that has a security code. A user can grant permission to their view key to particular parties with restrictions such as the ability to examine account balances but not spend any amounts in the account; accessibility to all past and current transactions, or exposure to only specific transactions in the account. Examples of this would be parents who want to watch their children’s transactions, and auditors the user would prefer to grant access to examine their account holdings and worth.