Crypto Assets

Currencies

Bitcoin

Type: Currency

Consensus: Proof-of-Work

Algorithm: SHA256

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Bitcoin is the original cryptocurrency, created and conceptualized by Satoshi Nakamoto in the midst of the financial crisis of 2008. Bitcoin utilizes a decentralized network that allows users to transact directly with each other without the need for middle entities. This system is made possible by the blockchain, an innovative new technology pioneered by Nakamoto. The blockchain is a continuously growing list of public immutable records, called blocks, which are linked and secured using cryptography. This ledger is then distributed across bitcoin’s network enabling it to identify ownership via unique wallet addresses. Additionally, Bitcoin’s network is overlaid with a set of internal incentives to ensure the overall security and reliability of the network.

Bitcoin Cash

Type: Currency

Consensus: Proof-of-Work

Algorithm: SHA256

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Bitcoin Cash is a Bitcoin clone with quicker transaction times. On August 1st, 2017, Bitcoin Cash was born by forking from the Bitcoin Core blockchain ledger to form a new peer-to-peer electronic currency. The hard-fork was the result of Bitcoin’s scaling controversy which began after Bitcoin processing times began to drag down the network. This was due to the limited number of transactions that can fit into each of Bitcoin’s 1MB block which amounts to about 3 transactions per second and not nearly enough for Bitcoin to be the ‘digital cash of the future’. Bitcoin Cash hoped to solve this problem by increasing the block size from 1MB to 8MB without implementing SegWit. The increased block size allowed for more transactions to be embedded in each block, increasing transaction times while lowering transaction fees.

Bitcoin Gold

Type: Currency

Consensus: Proof-of-Work

Algorithm: Equihash

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Bitcoin Gold is a distributed digital currency. It is a hard fork of Bitcoin which occurred on October 24th, 2017. The purpose of the hard fork was to change Bitcoin’s proof-of-work algorithm from SHA256 to Equihash in an attempt to bring more decentralization and democratization to Bitcoin’s mining process.

BlackCoin

Type: Currency

Consensus: Proof-of-Stake

Algorithm: Scrypt

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Blackcoin was launched on February, 24th 2014 and similar to Bitcoin was designed to be a peer-to-peer currency. The development team pioneered the use of a proof-of-stake algorithm in the context of the blockchain. As a consequence, it is substantially faster in generating blocks (i.e. transactions) than Bitcoin, taking 64 seconds to generate each block. The crypto asset awards a 1% annual interest rate to “stake” the coin.

Bytecoin

Type: Currency

Consensus: Proof-of-Work

Algorithm: CryptoNight

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Bytecoin is one of the first privacy focused cryptocurrencies (i.e. peer-to-peer currency) and was launched in 2012. Bytecoin pioneered the use of CryptoNote technology to process payments. This guaranteed total anonymity when transacting on the blockchain. For mining, Bytcoin uses a unique algorithm called CryptoNight, a similar algorithm to proof-of-work, but relies on ring signatures which enables anonymity when transacting.

Dash

Type: Currency

Consensus: Proof-of-Service / Proof-of-Work

Algorithm: X11

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Dash is open source peer-to-peer digital cash that at first may appear to have similar features as Bitcoin. However, Dash is quite different. Dash is a privacy focused cryptocurrency that provides an instant payment system a unique government structure that allows it to self-adjust. To accomplish this Dash has created a two-tier architecture where Bitcoin only has one. The first tier consists of miners who are rewarded for securing the network (using proof-of-work algorithm) and writing transactions to the blockchain and a second tier consists of something called masternodes. These masternodes work in clusters called quorums and represent a new way of thinking and enable not only governance structure to manage, fund, maintain and expand the project, but also provide additional capabilities like InstantSend and PrivateSend. This second tier uses, proof-of-service consensus algorithm rather than proof-of-work. This ensures speed within the network while maintaining a high degree of security within the network. The community members who own a masternode can vote in favor of or against proposals that help build the Dash Ecosystem. The goals for Dash is that this masternode system will provide a solution to the double spending problem, privacy issues and the endless scaling/governance debates that often plague the blockchain community leading to hard forks and overall instability.

Litecoin

Type: Protocol

Consensus: Proof-of-Stake

Algorithm: Ouroboros

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Protocols

Cardano

Type: Protocol

Consensus: Proof-of-Stake

Algorithm: Ouroboros

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Cardano is a smart contract platform that aims to solve the scalability, sustainability, and interoperability that platforms like Ethereum are currently facing. The development team takes a layered approach where the accounting and computational functions are separated. Additionally, Cardano uses a delegated proof-of-stake for generating consensus within the blockchain. Unlike the rest of crypto assets, the Cardano developers emphasize a peer-reviewed, research first approach. Finally, Cardano aims to strike a balance between the privacy needs of individuals and companies while taking into account the requirements of regulators.

Ethereum

Type: Protocol

Consensus: Proof-of-Work

Algorithm: Ethash

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Ethereum is a blockchain based software platform that enables developers to build and deploy decentralized applications. To understand Ethereum, a distinction must be made between Ethereum (the platform) and Ether (the cryptocurrency). Ethereum is the world’s first decentralized global computer that can be accessed and operated by anyone with an internet connection. It is composed of a network of nodes (i.e. independent computers, typically miners) who lend their computing power in order to maintain Ethereum’s Virtual Machine (i.e. the global computer). In order to incentivize these nodes to join the network, Ether (the cryptocurrency) is paid to them. In other words, Ether commoditizes computing power, and by doing so, a world computer is created. Due to how Ether derives its value, it is best understood as a commodity. A useful metaphor is oil is used to produce energy as Ether is required to produce Ethereum’s Virtual Machine (EVM).

Ethereum Classic

Type: Protocol

Consensus: Proof-of-Work

Algorithm: Ethash

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Ethereum Classic is a decentralized smart contract application that was born after it forked from Ethereum on July 20th 2016. Unlike Bitcoin Cash or other altcoins, Ethereum Classic did not split due to differences of opinion on how to improve the blockchain underlying code but rather as a result of how to proceed after a hack to the Decentralized Autonomous Organization (DAO). The only difference between the blockchains is that Ethereum Classic does not contain the irregular state change in block 1920000 where the hard-fork to refund The DAO token holders was implemented. Effectively, Ethereum Classic is a parallel version of the blockchain where funds were never returned to ether owners who lost funds in the demise of The DAO.