In this review we have looked at the top altcoins in regard to how much money is invested in them (market cap). However, we have excluded bitcoin cash. Read why and more about this review below.
|Market Cap in USD||29 Billion||9 Billion||3 Billion|
|Purpose||Platform for blockchain applications||Bank-system for financial transactions||Currency like bitcoin|
|2017 price increase||3,608%||3,966%||1,044%|
Growth in 2017
Exchanges with many other cryptos:
Ethereum has a very different purpose than bitcoin. Ethereum is an open source platform on which developers can build new blockchain applications. The applications can have various uses, for example, smart real estate purchase contracts or smart tags to verify the authenticity of sneakers. In this way, project-teams who develop new functions for the blockchain don't have to reinvent the blockchain wheel.
To use the ethereum blockchain, users pay according to how much they use it. The price is set for each operation and you pay with ether, ethereum's crypto-coin. Anyone can mine ether, although the process is different than for bitcoin.
Because of disagreements about how to prevent future hacks, ethereum forked in 2016 creating ethereum and ethereum classic. Ethereum (not ethereum classic) is the version that is most traded in October 2017.
The interest for blockchain as a security system is very large (even among many bitcoin-critics), and many big and powerful banks and institutions are investing in the technology. Ethereum helps the world and all startups that want to use the blockchain-technology by letting them use their blockchain for a small pay-as-you-use fee.
The ethereum platform is not fully developed yet; many large upgrades are planned. The so-called Byzantium upgrade that is planned for the end of October 2017 will introduce nine key improvements including making mining easier, speeding up transactions and improve security. The next big update to look out for is the Constantinople update.
The ethereum platform is still far from being finished and optimized for widespread use, and there are no significant amounts of actual users yet.
According to some estimates, the ethereum network will have to improve then number of transactions it can handle by a factor of 100 to serve the millions of users it is intended for. Some analysts also believe the ethereum security needs significant improvement.
The planned upcoming upgrades have some risks associated with them. In order for an upgrade to run smoothly, the ethereum miners need to agree to the updates they have to implement. If the miners don't agree, ethereum might fork and split into new versions of ethereum, but so far there seems to be sufficient consensus in the mining community.
Because many of the projects that have launched ICOs are or will be building applications on the ethereum platform, further restrictions on ICOs might affect the price of ether, at least short-term. So far the US and EU lawmakers have not issued any restrictions, but there are indications that the US might do so soon.
Even though ether is the second largest cryptocurrency and available on the majority of large exchanges, it is considerably harder to trade for cash on platforms such as localbitcoins.com.
Growth in 2017
Exchanges with many other cryptos:
Ripple aims to provide secure, instant and very cheap global financial transactions of any size. Using the Ripple network, one can transact with fiat currency, cryptocurrency, commodity or any other unit of value such as frequent flier miles or mobile minutes. The Ripple-coin is used as a bridge currency in Ripple's exchange-network.
All transactions are logged on the public Ripple ledger, and independent servers constantly compare their transaction record with each other. The servers can be owned by anyone, including banks.
The Ripple-coins aren't mined like bitcoin. Each Ripple-transaction destroys a small amount of Ripple which makes the currency slightly deflationary. There are currently about 100 billion Ripple coins.
The Ripple-team is targeting big banks around the world to use their system as it is much faster and cheaper.
The Ripple system has already been proven to work. The first bank to use Ripple is German Fidor Bank which has used it for new real-time international money transfers since early 2015. Ripple has so far (in October 2017) partnered with over 100 banks around the world and even the UK central bank is testing Ripple’s technology.
In April 2017 it was decided that a group of representatives of some of the world's largest banks including Bank of America, Merrill Lynch and Mitsubishi UFJ Financial Group will oversee the Ripple transaction rules.
We couldn't find much of what we believe is viable criticism of Ripple. However, that doesn't mean there aren't any problems with it.
Although some security weaknesses have been discussed, most analysts appear to view the Ripple system as robust and safe in the big picture.
The main threat to Ripple is probably that big banks can develop their own competing system, and several big banks are currently working on different blockchain projects. To date, no bank is publicly known to have come as far as Ripple has in developing a similar system, but the power and money behind the big fiat financial institutions may outweigh that fact.
Growth in 2017
Exchanges with many other cryptos:
Like bitcoin, litecoin is designed to be a currency to be used for payments, but with some differences in how the system works. New blocks are added to litecoin's blockchain more often than is the case for bitcoin, which should decrease the transaction time. The mining is also done differently, Scrypt algorithms are used instead of SHA 256 (which is the case for bitcoin).
Many cryptocurrencies need to improve transaction speed in order to meet the rising demand for the currencies, and a design-change called SegWit is one way to do that. Litecoin implemented SegWit in April 2017 and a transaction currently verifies about 8 times faster than with bitcoin. When bitcoin has implemented SegWit2x, litecoin will still verify transactions about 4 times faster than bitcoin.
Average network fees (miner fees) are currently significantly lower than for bitcoin at 0.069 USD compared to bitcoin's 2.43 USD (this was written in October 2017).
The mining of litecoin consumes less energy and can be done easier on PC's compared to bitcoin.
Litecoin is second to bitcoin in regard to ATM accessibility with 380 ATM's accepting it compared to 1,636 accepting bitcoin (in October 2017).
Although there haven't been any major security problems (yet), security is a bit lower than bitcoin because the blocks are created more often.
Litecoin has been around for a long time (for a cryptocurrency) but has still not taken significant market share from bitcoin and other major cryptocurrencies.
Although litecoin is available at many major exchanges, it's not widely adopted for payments. It is also more difficult to buy litecoin with cash. There are significantly less litecoin ATMs (380 vs. 1,636 for bitcoin), and there are significantly fewer sellers of litecoin on cash exchanges such as LitecoinLocal and LocalBitcoins.
Many analysts believe that litecoin's main problems are marketing problems and failure to gain widespread adoption. In these analysts view, litecoin works better than bitcoin but is not as well-known and therefore not as widely used.
It is said that the best developers work for bitcoin and no other cryptocurrency.
There are currently more than 1,000 altcoins in existence, some that seek to compete with bitcoin as a currency for monetary transactions and others with very different goals such as trading technological resources. Of course, there are top altcoins for each area of use. In this review we look at the top altcoins in terms of how much money is invested in them (market cap), because in theory that reflects investor's beliefs that the companies will succeed.
Of course, it’s not always true that investments that have attracted a lot of investment capital have higher chances of success than investments that have not attracted a lot of investors. The one thing that it does mean, however, is that there are usually more easily accessible articles and information about them. For this reason, they are a good place for beginners to start when investing in altcoins.
We have made an exception in our review. Bitcoin cash is currently the third largest altcoin measured by market cap, but we have excluded it. Bitcoin cash was created due to a fork in bitcoin in August 2017 that happened because the community couldn't agree on how to solve the scaling problem (more verifications need to be processed each second in order to meet the rising demand for bitcoin). The main reasons for the high price of bitcoin cash are related to how it was created instead of faith in the coin itself. The interest for bitcoin cash is low, you just don't read about it much, and the price has been falling
since it's creation. For these reasons, we have excluded it in this review.
As always, liquidity (that there are many buyers and sellers so you can make a transaction when you want) is important. For this reason, we have listed exchanges with good liquidity for each altcoin.
Although the price of bitcoin has risen by an impressive 379% between January 1st and October 10th 2017, the top altcoins have risen by much more, as displayed below. However, past performance never predicts future performance, we find this fact interesting and see it as a sign that investors also believe in these cryptocurrencies.
Disclaimer: The information in this article, as all content on BlockBull Review, is not and should not be seen as investment advice. The information is for educational and/or entertainment purposes only, so use it at your own risk. It is possible to lose money when engaging in any investment including cryptocurrencies and past performance does not indicate future performance. Any opinions expressed are those of BlockBull Review's writers who are not broker-dealers or advisors of any kind.