Examples of Cryptocurrencies

To better understand the diversity of assets in the crypto market, it makes sense to consider specific cryptocurrencies, tokens and staplecoins.

Bitcoin (BTS)

The first and most popular cryptocurrency. Right now, one WTC coin is worth about $43,000. Bitcoin’s capitalization has exceeded the $1.1 trillion mark.

Bitcoin is traded on many exchanges and is the main object of cryptoinvestments. The peculiarity of this coin is that its rate directly affects the value of a large number of other digital currencies. At the same time bitcoin itself is less volatile compared to other cryptocurrencies.

Pros of Bitcoin:

• Decentralization. One person, organization or even the government cannot control bitcoin. The operation of the blockchain is supported by hundreds of thousands of users around the world. This means that no one can block its operation.
• Stable operation of the network. Distributed resources that support the system neutralize the risk of equipment failures in a particular place, city or region.
• Cheap and fast transfers. The commission does not change for any transactions – within the city or between remote countries. For example, for sending 50 VTB in one transaction on Binance exchange you will receive commission of only $10.
• Deflationary properties. The maximum number of bitcoins was initially limited. No more than 21 million coins can be mined. This fact blocks the effect of inflation on BTC and makes it one of the most convenient tools for capital preservation.
• Protective asset. Bitcoin rate grows during different economic and political crises. In times of turmoil, ordinary people lose confidence in their national currency and try to transfer their savings into another type of asset. Bitcoin is one of the most popular options.

Minuses of Bitcoin:

• High volatility. The price of bitcoin changes very quickly and dramatically. In one day, its value can fall or rise by tens of percent. For this reason, VTC is not suitable for those who are focused on stable investments.
• Government regulators. Governments of different countries do not like the anonymity and decentralized nature of bitcoin. Therefore, government agencies block the possibility to use VTCs as a means of payment.
• The risk of acquiring “dirty” coins. If an investor buys a cryptocurrency that was used in fraudulent schemes, these funds may be frozen when transferred to a regulated platform for the duration of the investigation.
• Anyone can buy bitcoin and other cryptocurrencies on the Binance exchange using bank cards and fiat money. To do this, you need to visit the “Credit/Debit Card” section. There you can also use a special calculator to calculate the amount.

Ethereum (ETH)

This decentralized computing platform was created based on its own blockchain. It is based on the execution of smart contracts.

Ethereum platform has its own cryptocurrency – ETH. It is used for payments within the system and is traded on various exchanges. As of October 2021, there are more than 118 million of these coins. Unlike VTS, there is no limit on the volume of ETH. Its market capitalization exceeds the $353 billion mark.

Ethereum’s blockchain makes it possible to transfer digital money quickly and cheaply. But while bitcoin was created as a decentralized and anonymous payment system, Ethereum was developed as a single decentralized virtual machine. A distinctive feature of Ethereum is the use of smart contracts. This is the name of a virtual algorithm capable of automatically controlling the execution of the terms of a transaction recorded in the blockchain.

In addition to this basic feature, the system provides resources and a convenient environment for developing decentralized applications. At the same time, it remains flexible because it can execute arbitrary application code of any level of complexity.

Pros of Ethereum:

• The decentralization of the system;
• fast transactions;
• The blockchain platform allows you to create a variety of decentralized applications;
• continuous improvement;
• Applications can be created on the platform using simple programming languages;
• open source code;
• convenient and reliable smart contracts.

Minuses of Ethereum:

• No deflationary properties (developers are trying to address this shortcoming);
• imperfect security system;
• centralized management of some projects.

Binance Coin (BNB)

This is the main token in the system of the Binance cryptocurrency exchange, as well as in the Binance Chain and Binance Smart Chain blockchains. It is not possible to mine this coin.

The current rate of BNB is $339. The token has a market capitalization of $56 billion.

BNB is valuable because it can be used as a means of payment, both on the exchange itself, and in many services outside of it.

The advantages of Binance Coin include:

• discounts for Binance exchange services;
• convenient use as a means of payment – the number of transactions is higher than in Ethereum;
• low commission;
• Deflationary effect – every quarter a part of tokens is burned in order to limit their number.

Today, BNB can be used for various tasks:

• paying commissions on the Binance trading platform and blockchains;
• Participating in Launchpad;
• stacking;
• creation of smart contracts;
• payment as a reward;
• lending;
• sending donations.

All these advantages have made Binance Coin one of the most popular cryptocurrency assets.

Binance USD (BUSD)

The value of Binance USD is 1 dollar, as it is the digital counterpart of this fiat currency. The market capitalization of this asset has exceeded the level of $13.5 billion.

It is a regulated cryptocurrency that is pegged to the U.S. dollar. It is backed by fiat currency – for every issued BUSD, Binance has $1 in reserve. This format of working stablenkoin allows you to exchange it to dollars and vice versa.

The main purpose of BUSD is to keep the market rate stable. If the VTS is strongly fluctuating, the digital analogue of the dollar from the Binance platform has a stable value. On the Binance exchange, this stabelcoin is traded to various currency pairs, replacing USDT.

The issuer of this cryptocurrency is the company Paxos. The Binance exchange brought it in specifically for the issuance of the stabelcoin. Paxos has also issued PAX Gold (PAXG) Stablecoin. The value of this digital asset is linked to the price of gold. These two coins are regulated by the New York State Department of Financial Services.

Paxos is now responsible for 2 tasks:

• Securing the steylock;
• Controlling the issuance and burning of BUSD.

In addition to being good for storing capital, the BUSD cryptocurrency has other pluses:

• Convenient profit taking. A trader can transfer his earnings to BUSD, thereby avoiding losses due to a sharp decline in the value of the asset.
• the possibility of arbitrage on the blockchain Binance Smart Chain.

The disadvantages include centralized management and accountability to inspection authorities.

Polkadot (DOT)

The current value of this cryptocurrency is $28.5 per unit. Its market capitalization has exceeded the $29.5 billion mark.

Polkadot has its own token – DOT. It is used in several processes:

• Stacking;
• securing the system;
• managing the network.

Polkadot’s structure is one of the most complex of all the assets on the crypto market.

As an opensource protocol, DOT supports sharding technology and enables the interaction of individual blockchains. Thus, with Polkadot, any kind of assets and data can be transferred between different circuits and platforms.

Some developers are convinced that this technology will create a completely anonymous and decentralized Internet. DOT successfully competes with Etherium due to its new capabilities.

Polkadot successfully combines the work of the following technologies:

• public circuits;
• private circuits;
• oracles.

The centerpiece of the DOT blockchain ecosystem is Relay Chain. Any blockchain that joins it is called a Parachain. These blockchains can have their own governance structure, their own consensus mechanisms and tokens. Blockchains such as Ethereum and Bitcoin can also be easily connected to Polkadot with the help of special bridges.

An important advantage of Polkadot is that it solves the problem of scalability of projects by combining different blockchains into one system. This advantage is complemented by the high level of security, as well as the functionality and liquidity of DOT tokens.

There are also disadvantages:

• The project is not yet fully completed;
• high competition in the market of cryptoplatforms;
• insufficiently developed user base.

Minuses may be neutralized in the near future, as Polkadot is actively working on a team of professional developers.

Litecoin (LTC)

This is a cryptocurrency, the work of which is based on the code base of bitcoin. But Litecoin differs from VTC in the following characteristics:

• higher transaction speed;
• a different hashing algorithm;
• the order of issuance has been changed.

The current price of Litecoin is slightly above the $148 mark. The cryptocurrency’s market capitalization has reached $9.9 billion.

The main purpose for which Litecoin was created is to provide secure, inexpensive and fast blockchain payments. LTC can be used to easily pay for various goods and services in the U.S. and Europe. There are already many terminals around the world where Litecoin is exchanged for fiat currency.

The pluses of Litecoin include:

• reliability;
• the ability to mine the cryptovalta;
• easier scalability than VTC;
• high liquidity.

Minuses:

• High competition and lack of useful features;
• decline in the ranking of popular cryptocurrencies;

Overall, LightCoin is one of the most popular blockchain-based payment vehicles.

Conclusion

Today, there are a huge number of cryptocurrencies on the market, each of which has its own features, advantages and disadvantages. Through careful study of different assets, you can choose the best areas for investment, and begin to effectively use innovative technology.