What are the most important cryptocurrencies other than Bitcoin? A cryptocurrency is a digital asset or currency that is circulated across a large number of computers based on a network. There are different types of these decentralized currencies.
In fact, at any given point today, you may find anywhere between 4500 (according to Statista) to 5130 (according to CoinMarketCap) cryptocurrencies circulating in the market.
Not all of them are gems, however. Therefore, you will need to look at the right place to find the most important ones.
Here is the list of 10 most important cryptocurrencies that represent privacy coins, DeFi or Decentralized Finance, green energy, NFTs or Non-Fungible Tokens and more.
Please note, that the names that feature in this list may not be the most popular ones in the market.
What are the 10 Most Important Cryptocurrencies Other Than Bitcoin?
The importance of cryptocurrencies is primarily judged by its security features and enhancement, cryptography, and how hard it is to hack. Also, the characteristics of it plays an important role in the classification.
Based on these factors, the top 10 most important cryptocurrencies other than Bitcoin can be classified as under:
- Ethereum – This is supposed to be one of the most amazing cryptocurrencies.
- Litecoin – This is considered to be the best overall substitute of Bitcoin which offers faster transactions.
- Cardano – This stands out from its proof-of-stake peers due to the rigorous process.
- Polkadot – This unique cryptocurrency brings interoperability among other blockchains.
- Bitcoin Cash – This helps in increasing the block size.
- Stellar Lumen – This offers a different type of currency option to the people.
- Chainlink – This oracle network bridges the gap between the data outside the smart contracts.
- Binance Coin – This is a utility cryptocurrency and acts as the method for paying for the fees related with trading on the Binance Exchange.
- Tether – This is one of the most popular stable coins that reduces volatility by attaching market value to external reference points or a currency.
- Monero – This is a private and open-source currency that is untraceable yet secure.
In addition to the above, you will also find some other important ones circulating in the market.
It includes, and is not limited to, Ethereum Classic that offers a much wider variety of applications, Zcash or ZEC that is built on the orthodox Bitcoin platform, Bitcoin Satoshi’s Vision or Bitcoin SV which is an entirely detached branch of Bitcoin cash, Ripple that offers virtual payment protocol options to the companies, Neo which comes with Smart or Virtual contact feature option and more.
A Brief Description of Each Cryptocurrency
1. Ethereum (ETH) – This is a decentralized software platform. It enables DApps or Decentralized Applications and smart contracts. Anyone in the world can access freely irrespective of their nationality, faith or ethnicity.
It runs on Ether, the platform-specific cryptographic token which is the second-largest digital currency after Bitcoin according to market capitalization. It has little downtime, control, fraud, or third-party interference.
2. Litecoin (LTC) – This is an open-source network to make global payments and is often referred to as “Silver to Bitcoin’s gold.” As a proof of work, this uses a script that can be decoded by using consumer-grade CPUs.
It is similar to Bitcoin in several ways but its block generation rate is much faster. Therefore, the transaction confirmation time is much lower.
3. Cardano (ADA) – This Ouroboros proof-of-stake cryptocurrency has all the features to become the financial system of the world. Designed and created by mathematicians, engineers, and cryptography experts after thorough research, it involves a rigorous process.
The blockchain technology of it is much better than that of Ethereum and can provide much better solutions for voter fraud, chain interoperability, and legal contract tracing.
4. Polkadot (DOT) – This unique cryptocurrency works on a specific protocol that connects both types of blockchains whether it is permissioned or permission-less as well as oracles.
The relay chain is the core component of Polkadot that allows the interoperability among different networks. With the help of para-chains or parallel blockchains that have its native tokens for specific uses, it can create its own, secure blockchain.
5. Bitcoin Cash (BCH) – This is one of the most successful and earliest hard forks of the novel Bitcoin. This came into existence due to the splits between developers and miners, mostly based on the issue of scalability.
This has an increased block size from the traditional one megabyte of the Bitcoin network to eight MBs. It also does not have the Segregated Witness protocol. This can hold more transactions and also expedites its speed.
6. Stellar (XLM) – This is an open enterprise blockchain network. It connects financial institutions and provides enterprise solutions while making larger transactions especially between banks and investment firms.
With no intermediaries, transactions are made faster and at a low cost. Its native currency Lumens (XLM) allows cross-border connections with any currency.
7. Chainlink – This decentralized oracle network connects with outside applications in a much safer manner which the blockchains fail to do by itself. This results in smart contracts and provides the ability to communicate with the outside data to execute a contract in a more trusted manner.
8. Binance Coin (BNB) – This is a utility cryptocurrency. It helps in making the payments while trading via Binance Exchange, and also avail a discount.
Its blockchain helps the decentralized exchange of Binance to operate. Working on its own proof-of-stake consensus model and main-net launch, this is the most widely used exchanges in the world for trading in large volumes.
9. Tether (USDT) – This cryptocurrency has the ability to smoothen price fluctuations based on the market value to a specific currency. This attracts users since its price is linked to the price of the US dollar directly.
This allows the users to make transactions very easily, safely, and quickly from any other cryptocurrencies back to US dollars. This minimizes the complexity and volatility often linked with digital currencies.
10. Monero (XMR) – This open-source cryptocurrency is untraceable but secure and has raised the interest of the digital currency enthusiasts and cryptography community immensely.
This is entirely community-driven and donation-based but focuses mainly on scalability and decentralization. It assures total privacy with its unique technique called “ring signatures” or a group of cryptographic signatures.
Compilation of the Merits and Demerits of Some Cryptocurrencies
Here are the major advantages and disadvantages of some of the major cryptocurrencies of the world.
Bitcoin is an open-source network that can manage several users and is the real driver of this technological revolution and is considered to be the future of blockchain and network payment.
However, it is more expensive due to its growing demand. And, it can process only about seven transactions per second in your system with a consumption of a lot of electricity due to the consensus protocol.
This is the most utilized cryptocurrencies of all that allows cross-border payments between financial institutions.
It is quick and more economical. However, it is not fully decentralized while operating which makes this agile platform subject to criticism.
- Bitcoin cash
This is the result of a fork of Bitcoin and can handle much larger transactions and business volumes. The downside of this cryptocurrency is that it is too centralized.
This cryptocurrency is a Bitcoin duplicate. However, this can develop more transactions than Bitcoin and four times faster than it. However, this is not the ideal means for making payments since it uses a lot of energy.
This cryptocurrency can only serve the purposes like making payments and transferring. This is a more secure platform and stands out for its regulatory compliance and privacy factors.
It consumes less energy and uses a consent protocol of participation tests. However, the biggest demerit of it is that there is little info available about it.
This uses a proof of participation protocol instead of a proof of employment, like Cardano, and can make faster transactions more efficiently. Nevertheless, its tasks are hard to evaluate.
This is the largest cryptocurrency in China that allows smart contracts and works just like Ethereum. It can make 10000 transactions per second. However, this currency is also too centralized like Ripple and Bitcoin Cash.
- Stellar Lumens
This is a fork of Ripple but is managed by a non-profit organization. The biggest disadvantage of it is that it faces a lot of competition from the more dominant platforms of the conventional banking system, SWIFT.
- Coin purse
This cryptocurrency uses a unique digital signature to allow the member of a blockchain network to make a transaction more privately and keep the information hidden. The biggest concern of it is its characteristics which makes it vulnerable to cybercrime.
This performs using a shared accounting book and not a blockchain. It works mainly on the mathematical structure called the Directed Acyclic Graph.
The currency is primarily used by the Internet Devices of Things or IoTs to buy, sell, and market data. However, the general security of this system is quite questionable, according to crypto experts.
With such revelation, it can be said that though cryptocurrencies do have its benefits, there are a few limitations of it as well.
Which is the Best?
Since cryptocurrencies are still in their formative years, there is no best one. However, a few good ones can be segregated based on the Initial Coin Offerings or ICOs. Other features to look for in some of the good cryptocurrencies are:
- Its adoption rate in real-world transactions
- Its market capitalization along with liquidity
- The technology built into the individual platforms
- Security and anonymity features and
- Industry utility.
Based on these factors, these are the most commonly traded crypto currencies, though risks and lack of liquidity prevails.
- Bitcoin (BTC), for mainstream acceptance
- Ethereum (ETH), for highest market enthusiasm
- Stellar Lumens (XLM), for faster transfers
- Cardano (ADA), for best blockchain
- Terra (LUNA), as best Bitcoin alternative
- Litecoin, for faster transaction time and
- Chainlink, for better growth potential.
However, according to the market capitalization, the best 5 cryptocurrencies that you may choose are Bitcoin, Ethereum, Ripple, Bitcoin Cash, and Eos, in that specific order.
To sum up, each different type of cryptocurrencies has something unique in it and contributes differently to the larger crypto ecosystem. However, all these are subjective and can prove to be a risky investment, if done in haste.