There are two categories of cryptos: Coins like BTC and non-BTC cryptos called altcoins. The second are tokens or programmable assets that reside in a particular blockchain protocol.
Read about the basics of cryptos, the various types of cryptos, miners, soft and hard forks, and popular cryptos in India.
Basics of Crypto
There has been an explosion in the number of cryptos globally since 2009, when Bitcoin (BTC) was first launched. As of March 9, 2022, the total number of cryptos stood at 18,079, with a total market cap of $1.84 trillion. The key features of cryptos are that they are decentralised, encrypted, mined (created) on a Peer-to-Peer P2P distributed ledger blockchain protocol, and stored in digital wallets.
The digital public ledger or blockchain records each transaction by assigning an identity to it or ‘hash’ supplemented at the last part of the ledger. The reason behind the mushrooming of cryptos is that the technology behind it, blockchain, is open source, due to which any software developer can tap the source code to create something new.
Different Types of Cryptocurrency
There are generally two categories of cryptos: Coins like BTC and non-BTC cryptos called altcoins. The second are tokens or programmable assets that reside within a particular blockchain protocol. Coins that serve as a currency are built on their own blockchain, for example, ether (ETH) on Ethereum.
On the other hand, tokens do not serve as a currency and are built on an existing blockchain and can be used to carry out exclusive smart contracts. Altcoins, which were created to improvise upon BTC, are a short form for ‘alternative to Bitcoin’ like Litecoin (LTC), Peercoin (PPC), Namecoin (NMC), and so on. Like stock offerings, tokens are formed via an Initial Coin Offering (ICO). They can be represented as value tokens, security tokens or utility tokens.
Miners, Hard Forks & Soft Forks
Miners earn their cryptos through a very complicated, high-tech process using advanced and expensive computers which consume vast amounts of energy. When a blockchain gets outdated and needs an update, the computer nodes that validate a blockchain protocol create two options or get forked.
Some of the chief reasons for implementing a hard fork are fixing security risks, adding advanced functionalities or reversing transactions. In simple terms, when the community changes a blockchain, it splits or creates another chain that retains the history but veers off to another direction. All miners have to agree on the platform for a new update on the hard fork. Soft forks occur when previous transactions are termed invalid while the old nodes still recognise the new blocks.
Popular Cryptocurrencies in India
Here we list India’s seven most popular cryptocurrencies by market cap as of March 9, 2022.
Bitcoin: BTC has a cap of 21 million and was created by a group under the pseudonym Satoshi Nakamoto. Its current value is $42,063 and has a market cap of $798 billion.
Ether: ETH, created on the Ethereum programmable blockchain protocol, allows users to monetise and use decentralised applications (dApps). Its current value is $2,751 and has a market cap of $329 billion.
XRP: Developed by Ripple Labs, the worldwide money transfer network, XRP with a cap of 100 billion was intended to work on the Ripple platform. Its current value is $0.75, with a market cap of $36 billion.
Tether: The first stable coin pegged to the US dollar, USDT is not a speculative investment and enables investors to sidestep the extreme volatility in the crypto market. Its current value is $1 and has a market cap of $80 billion.
EOS: Created to support dApps, the EOSIO network controls the EOS token. Produced by developer Dan Larimer, EOS offers more transaction per second (TPS) capacity than Ethereum. Its current value is $2.07 and has a market cap of $2.04 billion.
BAT: Basic Attention Token or BAT tracks the time and attention of media consumers on websites using the Brave browser. It helps distribute advertising revenues more evenly amongst the constituencies. Its current value is $0.68 and has a market cap of $1.02 billion.
Chainlink: The chief objective of LINK is to facilitate real-time, accurate data for a worldwide network of computers to execute smart contracts. Its current value is $14.04 and has a market cap of $6.5 billion.
Conclusion: Coins and tokens are different forms of cryptos and they serve various purposes. Further, they are not controlled by any nation’s governing authority, unlike fiat currencies such as the dollar, Yen, Euro, or Rupee which are controlled by the Central Bank of the respective nation. You can buy, sell or trade crypto assets on an exchange. All the above-listed cryptocurrencies can be readily traded on Zebpay. Zebpay has time-tested safety and security standards in place in order to provide you with a seamless and secure trading experience.