Bitcoin vs Litecoin vs Ethereum
Cryptocurrencies have immutable and exchangeable features that make it hard to manipulate. Investors should take time to research and learn about each coin’s background, technology, and community before making a financial investment. It’s also important to consider the major companies partnering with or backing up the startup projects.
Below are comparisons of the top 3 cryptocurrencies: Bitcoin, Litecoin, and Ethereum.
What Makes Each Cryptocurrency Unique?
Since Bitcoin was the first decentralized cryptocurrency created, no other cryptocurrency would have been created without it. Several other cryptocurrencies or altcoins have taken on Bitcoin’s features and improved on it.
o Bitcoin was not the first digital currency, but it’s the most popular. Often referred to as digital gold, an asset that gains value through momentum.
o Ethereum’s blockchain is open-source and also decentralized like Bitcoin. Ethereum can create many other applications for a variety of sectors making it valuable to businesses and consumers.
o Litecoin is considered Bitcoin’s younger brother. They share many features but Litecoin is a better and faster version.
How Are Cryptocurrencies Made
Because there is no centralized bank or government to produce cryptocurrencies like regular money, they are generated through mining.
Mining is an extensive task that requires sophisticated hardware and a great deal of processing power. When transactions are done on the blockchain they are put together into blocks and verified for legitimacy by miners. These blocks are turned into mathematical problems that miners solve to earn cryptocurrency.
As more miners join the network, the difficulty level of the problems also goes up. Whenever this happens, a higher hashrate (speed of mining equipment) is needed to mine or find blocks. A higher hashrate is better because the opportunity to find the next block and receive the reward also becomes higher.
Price, Market Cap, Circulating Supply
Cryptocurrency prices differ from one exchange to another and are driven by supply and demand, media hype, political skepticism and regulations set by the government.
Market capitalization is the total amount of fiat currency (usually depicted in USD) invested in a cryptocurrency and is an indicator of the cryptocurrency’s value. It’s determined by multiplying the price with the circulating supply.
Circulating Supply is the estimated number of coins circulating in the market (i.e. in the hands of the public). The lower the circulating supply of a cryptocurrency, the more likely it will be in high demand.
3 Reasons TO Invest in Bitcoin, Litecoin, Ethereum
3 Reasons NOT to Invest in Bitcoin, Litecoin, Ethereum
Where to Buy Cryptocurrencies
It is a common practice among investors to not put all their money in just one cryptocurrency, but rather build portfolios with the top cryptos and certain alt coins that show great potential.
Cryptocurrencies can be exchanged with one currency into another through cryptocurrency exchanges. Some exchanges allow users to trade their local or fiat money directly to digital currencies. They accept credit card payments, bank transfers and other forms of payment for crypto.
Most of these fiat-to-crypto exchanges operate in the Eastern part of the globe to avoid regulation but accept Western fiat currency to broaden their customer reach.
Not all crypto exchanges have fiat-to-crypto pairings but they all have crypto-to-crypto pairing. Here are some notable cryptocurrency exchanges:
The innovation of cryptocurrency has so much to offer as an emerging technology and will revolutionize almost all economic sectors. However, with this opportunity comes an equally significant risk as profits are not 100% guaranteed.