Here’s a frequently asked question: How do I choose which cryptocurrency to invest in – aren’t they all the same?
There is no doubt that Bitcoin has captured the lion’s share of the cryptocurrency (CC) market and this is largely due to its FAME. This phenomenon is very similar to what happens in national politics around the world, where the candidate takes the majority of votes on the basis of FAME, rather than proven abilities or qualifications to run a nation. Bitcoin is a pioneer in this market space and continues to collect almost all titles on the market. This FAME does not mean that it is perfect for work and it is quite well known that Bitcoin has limitations and problems that need to be solved, but in the world of Bitcoin there is disagreement about how best to solve the problems. As problems arise, there is a constant opportunity for developers to initiate new coins that are targeted to specific situations, and thus differentiate themselves from approximately 1,300 other coins in this market space. Let’s look at two bitcoin rivals and explore how they differ from bitcoin and each other:
Ethereum (ETH) – The Ethereum coin is known as ETHER. The main difference from Bitcoin is that Ethereum uses “smart contracts”, which are objects for maintaining accounts in the Ethereum blockchain. Smart contracts are defined by their creators and they can interact with other contracts, make decisions, store data and send ETHER to others. The performance and services they offer are provided by the Ethereum network, all of which goes beyond what bitcoin or any other blockchain network can do. Smart contracts can act as your stand-alone agent, following your instructions and rules for spending currency and initiating other transactions on the Ethereum network.
Ripple (XRP) – This coin and the Ripple network also have unique features that make it much more than just a digital currency like Bitcoin. Ripple has developed the Ripple Transaction Protocol (RTXP), a powerful financial instrument that allows Ripple exchanges to transfer funds quickly and efficiently. The basic idea is to put money in “gateways”, where only those who know the password can unlock the funds. For financial institutions, this opens up huge opportunities, as it simplifies cross-border payments, reduces costs and provides transparency and security. All this is done with creative and intelligent use of blockchain technology.
The mainstream media cover this market almost daily with current news, but their stories are not very in-depth … they are mostly just dramatic headlines.
The show of the Wild West continues …
The selected crypto / blockchain 5 shares increase on average 109% from 11/17 December. Wild swings continue with daily tours. Yesterday we had South Korea and China at the latest, which tried to bring down the boom in cryptocurrencies.
On Thursday, South Korea’s justice minister, Sang-ki Park, sent global bitcoin prices to temporarily collapse and virtual coin markets to plummet as regulators say they are preparing legislation to ban cryptocurrency trading. Later that day, the South Korean Ministry of Strategy and Finance, one of the main member agencies of the South Korean government’s cryptocurrency regulation working group, came out and said that their department he does not agree with the premature statement of the Ministry of Justice on a potential ban on trading in cryptocurrencies.
While the South Korean government says cryptocurrency trading is nothing more than gambling and they are worried that the industry will leave many citizens in the poor house, their real concern is the loss of tax revenue. This is the same concern that every government has.
China has become one of the world’s largest sources of cryptocurrency mining, but it is now rumored that the government is involved in regulating the electricity used by mining computers. Over 80% of electricity for bitcoin mining today comes from China. Excluding miners, the government would make it difficult for bitcoin users to verify transactions. Mining operations will be relocated, but China is particularly attractive due to very low electricity and land costs. If China addresses this threat, there will be a temporary loss of mining capacity, which will lead to Bitcoin users seeing longer timers and higher transaction verification costs.
This wild journey will continue and much like a boom on the internet, we will see some big winners and eventually some big losers. Also, like the internet boom or the uranium boom, those who enter early will thrive, while mass investors always show up at the end, buying on top.
Stay on the line!