Bitcoin is only the best-known and most widely accepted of the new cryptocurrencies; it’s far from the only one. Other cryptocurrencies, or altcoins, include Bitcoin Cash, Bitcoin Gold, Ether, Litecoin, and Ripple, among many others. Acceptance is far from universal–crypto is only welcome at 36% of U.S. small-medium businesses–but as time goes on, more and more places are accepting Bitcoin as payment.
Accepting Bitcoin as Payment
Just this year, Elon Musk’s electric car company invested $1.5 billion in Bitcoin. Tesla also announced it will start accepting payment for its cars in Bitcoin, making it the first major carmaker to do so, and one of the biggest (if not the biggest) companies to accept crypto without a platform intermediary instantly converting it to a fiat currency.
The world’s largest repository of free knowledge accepts donations in Bitcoin. The Wikimedia Foundation–the people who run Wikipedia, Wiktionary, and other Wiki reference sites–uses the Bitpay platform and also accepts Bitcoin Cash and Ether.
Overstock.com doesn’t just accept Bitcoin (through Coinbase) for payment, they have their own cryptocurrency exchange– tZero. The online giant was one of the first retailers to accept Bitcoin and remains one of the largest.
Why Use Cryptocurrency?
One reason people buy altcoins is they believe that crypto is the currency of the future. If that’s true, it makes sense to stockpile them now before they get any more expensive. Others see them as purely an asset investment, like gold, and don’t think of it as a currency or payment method.
Libertarians are attracted to the decentralized nature of crypto, resistance to censorship, and radical transparency. Others just don’t like and/or trust banks or like how altcoins facility direct transactions without intermediaries interfering or charging overhead. For cryptocurrency like Bitcoin that has a finite and known supply, the fact that the currency unit will never be devalued due to inflation is a big draw.
How Do Other Cryptos Compare with Bitcoin?
As of February 18, 2021, these are the top five cryptocurrencies by market capitalization (how much they’re worth on the stock market):
- Bitcoin ($969.6 billion)
- Ethereum ($222.3 billion)
- Tether ($33.1 billion)
- Binance Coin ($30.5 billion)
- Cardano ($28.3 billion)
However, there are over 6,700 different cryptocurrencies currently publicly traded, with new ones coming out nearly daily. Taken together, all cryptocurrency is valued at $1.6 trillion total, $969.6 billion of which is in Bitcoin, a 220% jump just from the beginning of the year.
Ethereum is what you get when you combine cryptocurrency with programming: SmartContracts. Ethereum runs on its own altcoin, the Ether, and its blockchains allow directions to be programmed directly into them, creating autonomous monetary transactions that can perform themselves based on preset conditions.
Ether is used as both a currency, like other digital currencies, but also inside Ethereum to build and run distributed applications (“dapps”) and as compensation for work.
The Binance decentralized exchange (DEX) is a platform for both the buying and selling of Binance coins and for the conversion of other, third-party cryptocurrencies between themselves. The Binance DEX is currently the biggest cryptocurrency exchange in the world by volume due in large part to lower transaction fees if paid in Binance coins.
Other Cryptocurrencies, Tokens, and Platforms
It’s worth noting that market value isn’t the whole story. Here are a few lower-valued digital currencies that have high potential.
Ripple is technically the name of the company and network underpinning the altcoin XRP, but the XRP currency unit is commonly referred to as Ripple as well. Ripple’s big selling point is fast transactions– faster than Bitcoin– and it markets itself as an alternative to traditional wire transfers. There is speculation that it could be particularly useful for transfers that are too small for large banks.
One of the older altcoins, Litecoin was created by Charlie Lee in 2011. He called it “silver to Bitcoin’s gold.” It’s not as prominent as it once was when the field was less crowded, but Litecoin continues to gain attention by processing transactions faster than Bitcoin. At less than a tenth the price of Bitcoin, it’s more accessible to anyone just getting into crypto, while still carrying a rapidly rising value (up 167% this year).
Ethereum runs on its smart contracts; Chainlink has developed a reputation system for validating the information on which the smart contracts run. These data providers, or oracles, are verified, which verifies the contract, and the oracles are then paid with Chainlink’s crypto, Link.
This ambitious project’s goal is to connect and network together the disparate blockchain networks and altcoins, solving some of the scalability and compatibility issues of the current cryptocurrencies. It’s currently trading fairly cheaply, but if it manages any success at connecting up different blockchains, it will likely spark a firestorm of investor interest.
Not to be confused with Bitcoin itself, this cryptocurrency is the result of a “hard fork” in the blockchain, a branching off of Bitcoin that has been used to seed a new cryptocurrency with its own blockchain.
Its original goal was to improve resolution speed slowdowns due to transaction volume spikes. Like Litecoin, it could be a cheaper entry point than Bitcoin to crypto trading and usage, while still benefiting from both Bitcoin’s relative recent financial industry goodwill and its name recognition.
What if you wanted to distribute entertainment content with a blockchain network, instead of money? Tron aims to do just that. On the user side, the anonymity of the blockchain protects users’ data from being gathering and sold wholesale. On the creator side, artists can monetize directly with users via Tronix, the altcoin of Tron.
While people might have treated Bitcoin as a joke or passing fad when it debuted in 2008, thirteen years later, it’s pretty clear that digital currency in some form or another is here to stay. Since more places are accepting Bitcoin as payment every day, crypto’s reputation as not serious or “sketchy” is being constantly challenged. As a tipping point is reached, the market will weed out organizations that can’t keep up with the technological curve. Don’t get left behind; visit ForumPay today to see how easy it is to integrate cryptocurrency into your business.