Benefits of Bitcoin over Altcoins

In 2023, there is no longer a country where absolutely nothing is known about digital assets and blockchain. Many people are actively interested in and using them. This is a new kind of money that differs from traditional fiat currencies. The main difference is that ownership of cryptocurrency is possible without the involvement of a bank or special documentation. All your funds are stored in a personal cryptocurrency wallet, which is available 24/7.

Why is cryptocurrency so popular?

The answer to this question is quite simple: digital assets provide their users with absolute freedom. There are no restrictions on the amount or the ways in which they can be used. With cryptocurrencies, you can make both small and large purchases. You can easily buy products, clothing, phones, bicycles, antiques, houses, apartments, land, cars, paintings, and much more with cryptocurrency. You can also use these assets to pay for legal, financial, cosmetic, and other services both online and in real life. We have written more about this in this article.

If fiat money is backed by a gold reserve, what are cryptocurrencies backed by? Here, the system is built on different algorithms, namely the blockchain system. It is also worth mentioning the computing power used to store, exchange, mine, and maintain them. Many analysts also claim that crypto is backed by huge demand from users. Every day, thousands of people search for phrases like "how to buy crypto?", "top promising coins", "where to buy cryptocurrency?", etc. Since their inception until today, there are ten of thousands of cryptocurrencies. They can be divided into three groups:

• Bitcoin;
• Altcoins;
• Tokens.

In this article, we will examine each of them separately, as well as point out their similarities and differences.

A Brief Overview of Bitcoin

Earlier, the world knew only one coin, as you might guess - it was Bitcoin. The birth date of this digital currency was in January 2009. At that time, the world was not yet ready for the emergence of a new digital form of money, but the financial system needed it very much. The banking services we are used to were overloaded, and waiting for various transactions to be executed was a rather slow process. To solve these and many other problems, cryptocurrencies were developed. They function thanks to Blockchain, which guarantees their security and liquidity.

Bitcoin is a payment system that allows for various transactions, whether it be buying, selling, or exchanging digital and fiat currencies among themselves. The creator of this coin decided to remain anonymous, but often the name Satoshi Nakamoto appears on many information sources, but again, it is not exactly known whether it was one person or a group of people.

On January 3, the first block was mined from the network, which was called the "Genesis Block." The first BTC transaction was recorded in May 2010 when a person named Laszlo Hanyecz bought two pizzas and paid with bitcoins. At that time, the purchase amount was 10,000 BTC. If you convert the purchase amount to today's rate, then you can understand why May 22 is considered the day of pizza and bitcoin.

In 2011, active development of the digital market began, and already in 2013, 10 new cryptocurrencies appeared in the financial system, including Litecoin and Ripple.

The main advantages of BTC are:

• Complete absence of inflation.
• Independence from the policies and economies of states.
• Worldwide popularity. Since its release and up to the present day, this cryptocurrency is the most in-demand.
• No time restrictions and sum limits. You can exchange any amount anywhere.
• Exclusion of third parties. All exchange transactions take place without intermediaries, and as a result, they are carried out as safely, quickly, and profitably as possible. This also automatically eliminates the possibility of scammers and intruders hacking your wallet.
• Transparency of transactions. All BTC transactions are as open as possible. The client can track the entire chain of their transactions at any time.
• Exclusion of forgery of cryptocurrency or hacking.
• Profitability of international transfers. The commission for digital currency will be several times less than for fiat: euros, dollars, hryvnias. The transaction speed will be twice as fast.
• A great option for investments. The dynamic development of the digital market attracts more and more investors.

Altcoin – what is it?

As everyone already knows, Bitcoin is not the only cryptocurrency that is gaining popularity. In addition to it, there are thousands of different coins, called altcoins. An altcoin is the same digital asset that has the same algorithms and functions. In other words, it's all the coins except Bitcoin. They can be stable or volatile. Their history began in 2017, when many of them appeared. According to analysts' reports, more than 500 new coins were created. Many users also claim that altcoins are the main competitor to Bitcoin, as they occupy top positions on exchanges and their value is increasing every day. Bitcoin and altcoins are the two main crypto assets that are worth watching for competition.

TOP-5  first very popular altcoins:

• Ethereum is a unique system that distributes smart contracts on the blockchain. It is often used to develop applications such as DApps or specific services. The ETH token is often used to send information within the system. It is used as a traditional means of payment in banks and exchanges. The main advantage of Ethereum is that it is not subject to any specific person or organization. Such organizations and institutions can only offer rules and give recommendations.
• Litecoin was released in 2011, after Bitcoin. The creator of this coin was inspired by the success of its predecessor and decided to repeat it. Litecoin was developed as a P2P electronic currency that allows lightning-fast transactions worldwide. LTC is a decentralized payment service with open source code. It is capable of processing more blocks in the chain in the shortest possible time than Bitcoin. The approximate time to complete a pair of such transactions is 2.5 minutes, while it took Bitcoin a whole 10 minutes to do so. The Litecoin network supports software without the need to modify it in the future.
• Ripple's coin project was developed on the RTGS protocol, which means it has high throughput. There are about 100 billion XRP coins in total, 70% of which remain with the developers themselves, and 30% are traded on the digital market. Many users use this crypto because of the low fees. If you make a transaction with Ripple, then you need to pay only 0.0001 XRP as a fee. Another convenient feature for the user here is that if there was any mistake or inaccuracy made when submitting the application, everything can be edited and replaced. A significant disadvantage here is that all XRP tokens have already been mined, and it is not possible to mine the coin. However, despite this, Ripple is an excellent option for investments, payment for goods and services, and making transfers abroad.
• Cardano is a unique blockchain platform based on the Proof-of-Stake algorithm. Thanks to this algorithm, multi-level coin protection is applied here, which is stored in the user's personal account. This platform has some similarity to Ethereum, as smart contracts are also used here to transfer data to someone. By the way, the developer of ETH and ADA tokens is the same person. The name of the platform was named after the famous mathematician Cardano and the scientist Ada Lovelace. The cryptocurrency is based on its own personal Blockchain CSL (Cardano Settlement Layer). If we take into account the coin capitalization data for 2022, it held an honorable 7th place in the top, on par with Bitcoin, Ripple, and other popular coins and tokens.
• Bitcoin Cash was not created from scratch, but as a fork in the Bitcoin network in 2017. The emergence of coins in this way is not new to the world of cryptocurrencies, however, none of the existing modified tokens can compare with the price and demand for BCH. This token was very lucky because its predecessor had already proven its security and gained the trust of users. The team did not have to spend a budget on recognition and advertising, as the beginning was laid a long time ago. This coin was created with the goal of increasing blocks and launching new network nodes that will be based on more powerful computing equipment. The plus here is that BCH mining is available without much difficulty. All that is needed to launch the mining process is a pool, a crypto wallet, and a secure base for placing the work process.

Difference between Bitcoin and Altcoin

As you have noticed, altcoins have many advantages and positive aspects that allow them to compete with Bitcoin. However, they also have differences. For example, BTC develops new digital blocks using the proof of work algorithm. To do this, thousands of calculations are performed in the software. This process is very energy-intensive, as the system needs to process millions of blocks and chains of code in a short period of time. As for altcoins, they mainly use the Proof-of-Stake algorithm. With it, mining altcoins is easier because less energy is required. The processing time for transactions is also significantly reduced.

If you are also wondering, "What are the advantages of Bitcoin over altcoins?" then we will provide you with an answer. Its essence lies in the longevity of the coin. Since Bitcoin's release many years ago, the project has not only survived, but has also grown significantly in price. Compared to altcoins, many of them simply disappeared without gaining recognition from people. Of course, BTC has also had very loud drops, but it has managed to withstand them. The future of Bitcoin is very positive, if we believe the forecasts of crypto experts and compare the analysis of price changes in previous periods. Whether to invest in Bitcoin is up to you to decide. However, do not underestimate the cryptocurrency.