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A Detailed Guide On Different Cryptocurrencies & How They Work

A Detailed Guide On Different Cryptocurrencies & How They Work
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    December 29, 2022 Last Updated: May 30, 2023

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Bitcoin had a huge impact on the digital economy since its emergence. Back then cryptocurrency development was directly synonymous with bitcoins. However, by the year 2011, a heap of cryptocurrencies started emerging and making their way into the digital economy. And then the race of creating and owning the varied types of cryptocurrencies began in full swing.    

The need for owning cryptocurrencies is not just limited to any particular country, the craze of cryptocurrency development is all over the globe with an amplified force. One of the major reasons that made cryptocurrency have this prominence is its feasibility complied with the innovative nature of blockchain technology over which it operates. Furthermore this digital currency is not just now limited to the financial industry or institutions, but it has its wings spread in multiple industries and varied sectors of the economy and our societies today. 

Understanding cryptocurrencies and how they work is one of the most dominant factors in light of cryptocurrency development. We know that there are different perspectives of different folks over this digital currency that might confuse you in many ways. Therefore, we have come up with this blog that states the cluster of knowledge pertaining to understanding various cryptocurrencies along with their working mechanism. So keep reading with scrutiny and explore exclusively. 

How Many Cryptocurrencies are out there?

The cryptocurrencies as said have surpassed the genre of having a particular count, gone are those days when crypto’s were all about bitcoins. Today, there are thousands of cryptocurrencies prevailing in the industry that have established sheer prominence also. Cryptocurrencies are always designed and structured with new features or functionalities altogether, however, most of them are developed and built on the same principles that are followed by bitcoin.

The principles that cryptos dwell on are-

  • Cryptocurrencies are decentralized and have no connection to the central authorities. On top of that, the cryptos are neither issued, backed nor regulated by the central authorities in any way. 
  • A specialized computer code, known as cryptography backs up the coins and bitcoins with utmost encryption (Security).
  • Cryptocurrency development depends on the distributed ledger (Blockchain), as the cryptocurrencies are created on the same, along with the Peer-to-peer (P2P) reviews. 
  • Since cryptocurrencies are valuable assets, hence they are securely stored in digital wallets, to be precise blockchain wallets. With blockchain wallets, cryptocurrencies can easily be managed and traded by users. 

According to Statista, the total number of cryptocurrencies by the year 2023 was nearly about 9,000. However, the exact count for number of cryptocurrencies out there cannot be specified as every minute there is a blockchain enthusiast looking for cryptocurrency development exclusively.

Different Types of Cryptocurrency!

There are many people who think that crypto, coins, and token similar to one another and use these terms interchangeably. However, all these terms are not the same, and hence comprehend cryptocurrency in detail you must have a precise understanding of these terms and the differences they possess. 

Cryptocurrencies fall into two categories in general, they are-

The Coins- The coins are the most common category of cryptocurrencies, they can also include bitcoins and altcoins. The coins are basically created on their own blockchain, for instance, the Ether is a cryptocurrency that is developed or built on the Ethereum Blockchain technology. 

The Tokens- The tokens are known as programmable assets that tend to live amidst the blockchain of a given platform to them. 

Moving further, there as mentioned there is a term called Altcoins. So these Altcoins refer to all the cryptocurrencies apart from bitcoins. Therefore, there are some main types of altcoins, that basically include mining-based cryptos, such as Stable Coins, Utility Tokens, and Security Tokens. 


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What are Crypto coins?

Crypto coins are one of the most important parts of cryptocurrencies. The Crypto Coins are basically strings of computer codes, which vividly represent various genres of valuables. They can be termed as assets, projects, or concepts, they can either be tangible, digital, or even virtual. Most importantly, with varied valuations, they are intended for various purposes or uses altogether. 

The cryptocurrencies as discussed are far away from the eye of governance or centralization at all. Moreover, cryptocurrencies are nowhere like fiat currencies, and we know that normal currency can also be used to exchange goods and services, while cryptocurrencies have a plethora of uses. Since cryptocurrency is built on blockchain technology, there are certain cryptocurrencies that deploy solutions to long and previously existing issues related to the various sectors of the economy as a whole. 

What are Tokens?

Token development

The tokens are one of the most interesting parts of cryptocurrency. They are created and distributed via an Initial Coin Offering (ICO). This is usually and mostly similar to the Initial Public Offering (IPO) for the stocks. The tokens can be easily represented as the-

  • The Value Tokens (Ones like bitcoin)
  • The Utility Tokens (Ones like stocks)
  • The Security Tokens (Ones designed for specific uses)

The tokens usually differ from the coin, as the coins are constructed in the blockchain network of an existing coin, like Ethereum or Bitcoin. They are also programmable assets that give a kickstart in enabling the formulation and execution of unique smart contracts vividly. On top of that, the tokens also function to represent the units of various values such as coins, digital assets, money, electricity, and more. Furthermore, these tokens can be easily sent and received for various purposes. 

What are Altcoins?

Altcoins are yet another integral part of cryptocurrency development, these are a short alternative to bitcoins. Also, the advent of Altcoins was also an approach to improve the same from the bitcoins exclusively. There are various types of Altcoins, to name a few- Ethereum, Litecoin, Peercoin, Namecoin, and USD Coin.

Most of the Altcoins, are however developed and built over a similar framework as the bitcoin sharing some of its characteristics. Yet the altcoins, offer certain different traits than bitcoins. Similarly, there are certain Altcoins that use a different and unique procedure in order to produce as well as validate the blocks of the transactions. There are some Altcoins, that portray or offer new features, like less price volatility, smart contacts, or some advantages comprehensively. 

Leading Cryptocurrencies!

Before getting into the depth of cryptocurrency development, having a keen understanding and update on the leading cryptocurrencies is very important. You must know the factors that make these crypts one-of-a-kind. The valuation of cryptocurrencies is however not static and keeps fluctuating according to the market values, and actually, the prices can change at any moment of the day. Therefore, we will have a clear and precise note on the general characteristics of the leading cryptos so that you can differentiate on what you want to avail specifically. 

Leading Cryptocurrencies

Therefore, let us now explore the detailed list of the leading cryptocurrencies with much scrutiny-

1Bitcoin (BTC)

Bitcoin leads the chart when it comes to cryptocurrencies in any and every way altogether. Bitcoin is the very first cryptocurrency that came into existence and has managed to maintain its position since then very precisely. This cryptocurrency has been treasuring its prominence in terms of the user base, capitalization, and popularity exclusively. Bitcoin was introduced or developed in the year 2009 by Satoshi Nakamoto. Exclusive features or major upgrades like the taproot update and Lightening Network, helps bitcoin support both the dApps and Smart Contracts at the same time.

Bitcoin has come a long way, its pricing is highly volatile. By the year 2009, its value stood at $0.07 and by 2021, its value skyrocketed to $68,521. This elevation in the value can easily give you an idea of how important Bitcoin is amongst all the cryptocurrencies. 

2Ethereum (ETH)

With the perk of Smart Contract Functionality, Ethereum is a top-notch open-source decentralized blockchain. You can consider Ethereum to be the second largest or greatest cryptocurrency and it holds great prominence in the market after bitcoin exclusively. Ethereum was launched in in the year 2015 and by then it has been consistently attracting the attention of blockchain enthusiasts adeptly.

Ethereum works or operates over its blockchain that supports smart contracts running on their own blockchain, while these are automatically executed when specific conditions meet. On top of that, the Ether is the cryptocurrency that runs over the Ethereum Blockchain. Recently there has been a worthwhile upgradation in the model of Ethereum. It got shifted from the Proof-of-stake model to the proof-of-work model. 

3Binance Coin (BNB)

Making a third place in the list, the Binance Coin is the native of Binance Exchange, and this is the largest cryptocurrency exchange in the world. This masterpiece was created in the year 2018 and soon established its worth and prominence globally. It can be used for multiple uses like credit card payments, trading, loans, payment processing, and other transactions precisely. 

The approach of increasing the popularity of Binance Coin, the BNB exchange did look for various solutions. The transaction fee for the Binance Exchange is comparatively lower when the users pay via the BNB. On top of that, for making the value of the Binance coins stable and adept, the exchange destroys, cuts off, or burns a certain percentage of the coins in a specific circulation. Interestingly Binance also gives away the scope to earn free crypto or blockchain resources. The Binance academy was launched back in 2018 and rewards back learners so that they can have extended and deeper knowledge in the crypto space, as well as the blockchain. 

4Tether (USDT)

The tether is one of the most popular yet unique cryptocurrencies. The nature of this currency is completely different from the rest. The USDT is a Stablecoin and is backed by the equivalent number of US Dollars. Normally the price or value of cryptos keeps changing and fluctuating, yet the price of Tether remains relatively constant at $1.

Most importantly, the Tether does not have a blockchain of its own therefore it operates or runs over a second-layer token over varied blockchains like Bitcoin, Ethereum, Tron, OMG, and Bitcoin Cash. Hence, this crypto is adeptly secured by the hashing algorithms. Considering the asset-backed nature, the tether is not minable, hence new tethers are introduced to the verified users who exceedingly make fiat currency deposits. 

Cryptocurrency development at its best

5Cardano (ADA)

Popular in the industry for its advancement of Smart contract functionality, the Cradano is also called the “Ethereum Killer”. By providing adept solutions for Chain interoperability, Cardano also establishes or issues products similar to the DeFi, which are same the as Ethereum. 

One of the most interesting facts about Cardano is that it is eco-friendly in comparison to its peers because it uses an algorithm known as the “Ouroboros”. 

6Solana (SOL)

Solana is yet another famous and adept Blockchain that was launched in the year 2017. This was basically launched in order to elevate the speedy execution of the dApps or the decentralized applications. Solana also earns the name of the Ethereum Killer as it has the ability to perform much more Transactions per second (TPS) as compared to Ethereum and at lower transactional fees. 

One of the most interesting aspects of Solana is that it has the fastest TPS among all Blockchains and hence it is considered to be the Ethereum Killer. 

The list of Leading Cryptocurrencies has a never-ending number at the count that keeps moving ahead. Apart from these mentioned cryptocurrencies, a few other Crypto that steals the show are-

POLKADOT, LITECOIN, DAI, THE SANDBOX, TRON, AVALANCHE, DOGECOIN, Shiba Inu, UNUS SED LEO, POLYGON, & the list goes on…

Wrapping Up

The advent of cryptocurrency is a boon to the financial sector as trading has now unconventional perks. The nature and functionality of Crypto if understood with scrutiny can help you take your venture to the place where you must have envisioned. We at Blocktunix ensure helping all blockchain enthusiasts with #1 Cryptocurrency Development. With an exquisite experience, our blockchain experts use the latest technology to carve out the best deliverables for you. 

Before starting to invest in cryptocurrencies, you must know all the What, and if’s about the same. So without further ado, you must connect to the blockchain experts- Blocktunix, and start getting into the umpteen perks that cryptocurrencies bring along. 

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