A cryptocurrency is a digital currency that uses cryptography as a form of security. Cryptography is a technical term for using encryption to identify who controls what. When you combine the two, you create a digital currency owned by its carrier.

Cryptocurrencies could change the way Internet-connected global markets interact with each other. People can digitally exchange money, contracts, and assets thanks to the Blockchain. Use the internet to transfer information. Use Blockchain to transfer ownership.

Crypto Coins Then and Now

In 2009, Satoshi Nakamoto created the first cryptocurrency, Bitcoin. Many investors consider Bitcoin to be the original cryptocurrency. But one of the oldest attempts to create a cryptocurrency was 20 years ago.

Digicash, which failed in the 1990s, was the first notable digital currency. People were transferring DigiCash in a secure and confidential manner. It used the so-called “blinding formula” to encrypt information passed between individuals. The transaction had a signature of validity. Without traceability, it was simple to make an update.

The term “cryptocurrencies” was first used in 1998. The concept became completely realized in 2009. The publication of a white paper defined the fundamentals of Blockchain and Bitcoin.

According to the popular crypto-exchange Coinbase, currencies with the largest net worth include:

  • Bitcoin
  • Ethereum/Ethereum 2
  • Binance Coin
  • Tether
  • Cardano
  • Polkadot
  • XRP
  • Uniswap
  • Litecoin

Cryptocurrencies are on their way to becoming widely adopted. Along with blockchain technology, they are likely to grow in popularity in the next few years.

It is impossible to predict whether cryptocurrencies will outperform or underperform traditional investments. But, without a question, Bitcoin and other cryptocurrencies are here to stay.

What are Crypto Coins?

A cryptocurrency is a digital asset designed to function as a medium of exchange. It uses cryptography to secure transactions and confirm asset transfers. Cryptography means using an encryption technique to protect and confirm a transaction.

Every cryptocurrency uses its own rules. Speed and cryptographic encryption algorithms are two examples of differences between cryptocurrencies.

Bitcoin is the first decentralized cryptocurrency, based on the Blockchain. His system works as a public database. It tracks and confirms its transactions chronologically.

Coins, Tokens, and Altcoins are the three major types of cryptocurrencies. Not all of them serve as a currency or medium of exchange. What makes them different is their core functionality and design use case.


–  Bitcoin is a transactional cryptocurrency because of its use as a transfer of value;

–  Tokens are cryptocurrencies that run on the Ethereum blockchain technology;

–  An altcoin is a cryptocurrency, or virtual currency, alternative to Bitcoin.

Coins are forms of digital money created by the use of encryption methods. They have the same characteristics as money. They are transferable, flexible, acceptable, mobile, long-lasting, and in short supply. Bitcoin is the most famous example.

Tokens are digital assets generated by a project. You can use tokens as a method of payment inside a project’s ecosystem. They can also perform similar functions with coins. The main difference is that it also gives the holder a right to take part in the network.

Tokens represent an asset or utility. There are two types of tokens: security and utility tokens.

Security tokens are digital assets that derive their value from transferable external assets. Utility tokens are user tokens or app coins.

Altcoins are alternatives to Bitcoin. They are cryptocurrencies that use blockchain technology which allows secure peer-to-peer transactions.

Most Popular Coins

There are thousands of cryptocurrencies today. While originally developed as a method of trade, cryptocurrencies are now viewed as a possible investment.


Bitcoin is the most well-known Blockchain application. It was one of the first digital currencies to make use of peer-to-peer technology to enable instant payments.

There are three main ways people get Bitcoins:

  • You can buy Bitcoins using ‘real’ money;
  • You can sell things and let people pay you with Bitcoins;
  • You can “mine” Bitcoins by using a computer.

The real value in Bitcoin comes from its two characteristics, usefulness and its limited supply of 21 million coins.

Classic Altcoins

Altcoins operate on the same principles as Bitcoin. Mining-based cryptocurrencies, stablecoins, security tokens, and utility tokens are some of the most common forms of altcoins. A few examples of altcoins include:

Ethereum (ETH)

Ethereum’s primary function is to allow developers to create smart contracts and distributed applications (dapps).

Tether (USDT)

Tether tracks the value of a certain fiat currency like dollars or euro. It is extremely useful for storing or transferring value.

Litecoin (LTC)

Litecoin has a faster transaction speed than Bitcoin. Litecoin is attractive to investors as a possible long-term holding.

Dogecoin (DOGE)

Dogecoin’s main features are its low price and unlimited supply. It gained its popularity in 2021, experiencing remarkable price increases.

Newer Generation Coins

Cardano, Polkadot, and Stellar are now viewed as third-generation cryptocurrencies. These cryptocurrencies offer many advancements over the first and second-generation cryptocurrencies.

The newer generation of coins includes:

Cardano (ADA)

Cardano builds on the work of Bitcoin and Ethereum while trying to be more sustainable and scalable.

Ripple (XRP)

Ripple is a technology that functions as both a cryptocurrency and a digital payment network.

Polkadot (DOT)

Polkadot is one of many competing blockchains aiming to grow an ecosystem of cryptocurrencies.

Solana (SOL)

Solana is a fast, secure, and censorship-resistant blockchain. It provides an open infrastructure required for global adoption.

Stellar Lumens (XLM)

Stellar’s main focus is on building economies through remittances and bank loans to individuals who do not have access to financial services.

Main Traits of Crypto Payments

Today the majority of real-world assets are still represented by paper and are very illiquid. With the advent of the Blockchain, ownership is going to move from analog to digital. We will see illiquid assets released into liquid markets. To simulate financial markets, crypto markets include elements like the stock market.

The old saying was “Money is power“. With the advent of cryptocurrency, the new saying goes “Money is technology“.

The real-life usage potential:

  • Payment processing and money transfers – By removing the banks as an intermediary, we get fast, secure, 24/7, no need to confirm transactions;
  • Medical record-keeping – Besides storing patients records, the patient is going to be in control of who gains access to that data;
  • Equity trading – With tokenization, Blockchain could replace current trading platforms for buying or selling stocks. These new types of networks authenticate and settle transactions in real-time.

Some of the potential advantages include:

  • Potential for high returns – One of the main arguments in favor of cryptocurrencies is the potential for high   returns.
  • Potential diversification – Diversification is also a potential benefit of investing in cryptocurrencies. Some people consider cryptocurrencies to be a substitute for gold.
  • Limited supply – A particular feature of bitcoin is that there is a maximum of 21 million coins, created or mined. Bitcoin’s exclusivity adds to its promise for certain investors.
  • Protection from the threat of rising inflation – Bitcoin and other cryptocurrencies provide non-depreciating alternatives. Supporters of this viewpoint believe that cryptocurrencies will provide stronger protection against increasing inflation.
  • Growing acceptance and usage – Many payment platforms are now allowing transactions in Bitcoin and other cryptocurrencies. There has been a significant increase in the number of electronic wallets created over the past few years.

Possible disadvantages:

  • High volatility and potential for large losses – It is important to know that the potential of large gains is sometimes balanced by the chance of big losses. The timing of the crypto investment will have a major impact on the gained returns.
  • Endless potential supply – Many cryptocurrencies have limited supply built into their protocols. There are also opportunities for launching an ever-growing number of new cryptocurrencies.
  • Unregulated and unbacked – Cryptocurrencies are a construct of the private sector. There is no official oversight or regulation. Cryptocurrencies are not backed by anything other than confidence in the system. This means that any disruption to that system makes the coin highly insecure.

What Can You Use Crypto For?

Cryptocurrencies are typically thought of as high-risk investments. Still, they have a wide range of powerful use cases:

Low-cost money transfers

The most well-known use of cryptocurrencies is for low-cost, high-speed sending and receiving payments.

Earning interest on Bitcoin or other cryptocurrencies

Profitable cryptocurrency trading takes a large amount of time and knowledge. That is why many cryptocurrency owners are holding their coins for long-term gain.

A censorship-resistant alternative store of wealth

Bitcoin and other cryptocurrencies function as a censorship-resistant alternative store of wealth. Only the individual with the private keys to the wallet has access.

Investment in innovative early-stage startups

By using digital token-based fundraising, today, anybody can become an investor. At the same time, this offers much-needed seed money to new startup companies.  Initial coin offerings (ICOs) and IPOs are a form of fundraising that gives startups an opportunity to raise capital.

Make private transactions

Users can make anonymous financial transactions with privacy-focused digital currencies. These cryptocurrencies include Monero (XMR), Zcash (ZEC), and  PIVX (PIVX).

Send non-cash remittances

Non-cash transfers are another powerful use case for cryptocurrencies. The Blockchain startup SureRemit enables its users to send non-cash transfers from anywhere in the world to selected African nations.

Get paid to post content

Steemit is the world’s first incentivized social media and blogging platform. The authors get financial compensation in the form of cryptocurrency in exchange for posting content.

The Future of Cryptos

The future of cryptocurrency is still very much in debate. The cryptocurrency supporters see endless possibilities. The critics see only the risk. Without a question, there are many cases when a cryptocurrency is a suitable solution. The predictions and anticipations about cryptos go both ways.

Today, cryptocurrencies face some limitations. The fact that a computer failure or a hacker attack might erase one’s digital wealth, may outweigh their technological achievements.

The number of merchants accepting cryptocurrency has grown drastically. Yet, they are still in the minority. To become more extensively used, cryptocurrencies must first achieve significant consumer acceptability. Their complexity in comparison to traditional currencies is discouraging the majority of consumers.

For many, however, it is getting harder to imagine a future without cryptocurrencies.  Some predict the coins will forever change how we understand and interact with money. These days, the emerging crypto market is not only attracting retail investors. Financial institutions and big companies are also attempting to profit from the rising trend of digital assets.

Blockchain is no longer used only in cryptocurrency. Its acceptance also found its way in insurance, fintech, and medical industries. More acceptance means more problems these technologies can solve in our day-to-day life.