Understanding the different types of cryptocurrency

In 2009 , a cryptocurrency named Bitcoin launched, when it launched there was almost no competition in the brand new world of cryptocurrency.

But, now we are in 2023 and there are different types of cryptocurrency which are available in the market leading to a cut throat competition amongst every cryptocurrency including bitcoin.

Through the use of blockchain technology different types of cryptocurrency have launched in the market. And within no time the race to generate more and more crypto started.

The power of blockchain technology can be understood with the fact that earlier in the absence of blockchain technology, when an individual had to transfer money abroad, it used to take 3-5 days but it has now reduced to seconds or minutes at max. All this has been possible due to blockchain.

‍

In this article, we’ll get to know what exactly is a cryptocurrency and its various types.

‍

Cryptocurrency- What Is It?

‍

Before we jump onto the meaning of cryptocurrency it’s important for us to understand that the normal currency that you use such as Dollars or Euro which is also known as fiat currency is completely different from cryptocurrency.

‍

Where fiat currency can be  touched and governed by  a central authority, the cryptocurrency can not be  touched as it’s a digital money and also is not governed by any central government.

‍

These types of currencies are based on blockchain technologies which have their own use in the digital world.

‍

Different types of cryptocurrency

‍

Now that we know what cryptocurrency is and how it is different from your typical currency that you use in your daily life.

‍

It’s time that we dive into the different types of cryptocurrencies that are available today in the market and based on that you can make an opinion on which cryptocurrency you should go for.

‍

1. Bitcoin (BTC)

‍

If you are someone who knows even a bit about cryptocurrency than I’m sure you might have guessed the first cryptocurrency I’m going to talk about.

In the world of cryptocurrencies, Bitcoin stands tall with a market share of $410,202,265,385. With that amount it’s much ahead of the competition. Fun fact, Bitcoin is the very first cryptocurrency to get launched in the market. Each day, more than thousands of Bitcoin gets mined every day making it bigger and better.

Like all cryptocurrency, Bitcoin also functions on blockchain technology and is not controlled by the central government. Users use powerful computers to generate bitcoins and verify the transactions.

‍

2. Ethereum (ETH)

‍

The next on the list is Ethereum. Ethereum got designed in such a way that it was not meant to support cryptocurrency, but to allow the users to publish, create and monetize and deploy decentralised applications.

Many people often compare Bitcoin with Ethereum but you'll get surprised to know that both of them got designed to achieve different results  and are dependent on each other in many ways.

Bitcoin, used for transactions which do not involve any central authority whereas Ethereum, also known as world computer, depends upon bitcoin technology while dealing with smart contracts (a technology which helps in building decentralised apps).

With a market cap of $150, 833, 549, 828 Ethereum is the second biggest cryptocurrency behind Bitcoin.

‍

3. Tether(USDT)

‍

First launched in the year 2014, by the company Tether limited Inc. With a market share of $66, 837, 248, 865 Tether became the first cryptocurrency which traded in the market through the name of stablecoin (a kind of crypto).

‍

Tether is a cryptocurrency which is designed in such a way that it offers an user various major benefits right from, a lower transaction fees, stability as well as transparency.

‍

4. USD Coin(USDC)

‍

With a market cap of $55, 887, 416, 457 USDC also falls in the category of stablecoin. It launched in September 2018. It’s a stablecoin which runs on Ethereum blockchain. The main aim of this crypto is to make the transactions smoother faster as well as cheaper.

‍

5. Binance Coin(BNB)

‍

First launched in July 2017, and with a market cap of $39, 135, 965, 106 BNB, started as an Ethereum token later it moved on to Binance smart chain which launched in September 2020.

‍

BNB also used to provide traders with discounts on trading fees on Binance, but now it’s used for payments, for entertainment or any online services and many more.

‍

6. Dogecoin(DOGE)

Launched in 2013, and with a total market cap of $9,088,298,080 this cryptocurrency  caught all the people’s attention because of its name.

Many of you might not know but Dogecoin launched as a way to poke fun at bitcoin and it began to be known as the first Joke cryptocurrency, quite interesting isn't it?

This cryptocurrency's used on reddit or twitter(now X) to tip or to reward the creation of quality content.

‍

Conclusion

The world of cryptocurrency hasn't been the same since the launch of bitcoin and other cryptocurrencies. You now have a variety of options to choose from. The above list of cryptocurrency would have enhanced your knowledge on the different types of cryptocurrency available in the market. Go through all of them and you are all set to dive into this interesting world of digital currencies aka cryptocurrencies.

‍