The first cryptocurrency was Bitcoin, which appeared in 2009 and caused a real sensation among users of the global network. Since then, the popularity of the new currency has only been gaining momentum. Since 2011, there have been many more cryptocurrencies. Unique in its kind "substitutes" for paper money attract independence, new opportunities, affordability and low fees. What caused the diversity of cryptocurrencies? What types of new "electronic" money exist today?

 

Types and features of cryptocurrencies

If we consider the most popular cryptocurrencies, then the following options are worth highlighting:

Bitcoin (Bitcoin) is a pioneer among many cryptocurrencies. Year of creation - 2009, developer - Satoshi Nakamoto. This monetary unit is not just an alternative to the “pieces of paper” that circulate in cash. It was issued as a currency that repeats the properties of gold. The emission of new money from the first days of its appearance was limited and amounts to 21 million coins. Bitcoins are mined by solving complex problems and creating new blocks.
Litecoin (Litecoin) is the next type of money that has appeared since October 2011. The developer of the system was one of the employees of Google, who had previously quit his job and switched to his own "bread". Charlie Lee (this is the name of the creator) planned to peg the new currency to the value of silver. This is why this currency is called "electronic silver". The Litecoin rate is regularly growing, which is caused by the limitation of this money (up to 84 million coins). Unlike Bitcoin, Litecoin mining is faster (four times on average).
Primecoin (Primecoin) is a currency that is positioned as an adjusted version of Bitcoin, its copy. The year of issue is 2013. The developer of the cryptocurrency is Sunny King, who created a number of other electronic money. The hallmark is the usefulness of computation. The system calculates prime numbers that are necessary to solve other useful problems in mathematical, cryptographic and other fields of activity. The best miners can expect rewards that range from one million to one billion.
Percoin (Peercoin). There are a lot of cryptocurrencies released today that deserve close attention, and Percoin is one of them. The year of creation is 2012. The main difference from the money considered earlier is that there are no restrictions in terms of emission, which is a big plus. But there is also a minus - the tendency to inflation, which is about one percent per year. When creating new money, the developers did not invent anything. Despite the diversity of cryptocurrencies, all the new money has similarities. It happened in this case as well. In fact, the currency is based on the source code of Bitcoin. As for mining, things are different here. Unlike Bitcoin, the money is distributed not only between the "miners", but also between the owners of the cryptocurrency.
Namecoin is another popular system among many cryptocurrencies, which is a set of alternative DNS servers. The currency was created back in 2011. It has an emission limit of 21 million coins. There is no central server in Namecoin, that is, it is decentralized. The main goal is to distribute the domain resource system on the network. The new currency is used to pay for the registration of domains with the .bit extension. Thanks to reliable protection, domain hacking is virtually impossible.
Feathercoin is a copied version of Litecoin, already discussed earlier. The year of creation is 2013. The main feature of the system is the possibility of emission, which is several times higher than the tolerances for other alternative currency units (336 million coins). The money gained popularity only thanks to the developers statement to eliminate all existing vulnerabilities. It was against the background of increased reliability that Feathercoin was promoted among the masses.
Freycoin (Freicon) is another currency created on the basis of Bitcoin. The year of creation is 2013. The main task of money was to solve problems with cash, and to eliminate many problems associated with the accumulation of funds. There is also a release limit of 100 million coins here.

Reasons for the popularity of cryptocurrencies

What caused such popularity of new money? Why have so many cryptocurrencies emerged over the past seven years? There are several reasons for this:

- The new systems are decentralized, which ensures that there is no oversight from the governing bodies. The emission of new money is a programmable process that does not depend on the level of supply and demand, but on the performance of complex calculations in a computer network, as well as the solution of a number of problems by miners.

- Full freedom. As already mentioned, the diversity of cryptocurrency is caused by another factor - the lack of control of transactions by the bank, tax police or other supervisory authorities.

- Confidentiality. Online payments are completely private. Thanks to the new money, many are avoiding paying large taxes. On the other hand, there is a risk of being left without money in the event of an attack by hackers or other force majeure situations. In addition, the confidentiality factor contradicts the current international standards, as well as the rules for disclosing data when making transactions.

- Lack of a common organizer of trades, as well as companies that issue many cryptocurrencies. The system is independent, which makes it more promising.

- Resistance to inflationary fluctuations. One of the main advantages of most cryptocurrencies (not all) is inflation resistance. At the same time, experienced investors understand that over time, the value of such a currency will only grow. This is why many traders and investors are actively playing on the exchange rate price of the new money and making a lot of money.

- Lack of commissions. Users who often make transactions between countries are interested in one of the main qualities of cryptocurrency - the absence or minimum level of commissions. Unlike classic bank payments, here the costs of making a transfer are minimal, which allows you to carry out transactions with large amounts and not worry about the safety of funds in your wallet.

Thus, the popularity of cryptocurrencies is justified. Of course, there are also negative factors, for example, lack of security, limited emission, low level of security and others. But all this is insignificant. Most of the participants are interested in three main advantages - privacy, no commission and decentralization. These factors are the main driving force in the creation of new cryptocurrencies.

At the same time, one cannot dismiss the theory that electronic money has the form of a pyramid scheme with all the risks and properties that follow from this. Early adopters get more opportunities than people who come over time. The closer the number of coins is to the emission limit, the more difficult it is to mine and the higher the market price.