An Ultimate Guide to Different Types of Cryptocurrency and Their Features!

In 2009, people were introduced to a whole new world of digital currency, as Bitcoin was launched. By the end of 2011, several organizations have launched other cryptocurrency platforms by following the same blockchain technology used by the Bitcoin inventors. According to reports, the market value of cryptocurrencies was only 10 million USD in 2011, and now the total net worth associated with cryptocurrencies is more than 2.2 trillion USD. Today, you can find different types of cryptocurrency that can be classified into two categories.

Coins – Bitcoins and Altcoins (Crypto coins other than Bitcoin)

Tokens – These are the programmable assets that regulate a given platform through a blockchain.

But before you jump to know a few common types of cryptocurrencies and how you can earn from them, read easy ways to save money and money saving apps to become an excellent money manager. 

Let’s delve deeper and know some of the most notable cryptocurrencies that have created a lot of buzz in the last few years.

1. Bitcoin

There is no surprise that we are starting this list with Bitcoin. If you are wondering how to make money with cryptocurrency, then the first digital currency that should come to your mind is Bitcoin. Bitcoin formed the foundation of the cryptocurrency market. At present, approximately 19 million Bitcoin tokens were circulated across the world in 2021. Bitcoin depends on blockchain technology and does not come under any regulation made by the national governments and central banks. 

2. Ethereum

After Bitcoin, the second most recognizable name in the crypto market space is Ethereum. The digital currency that is used by this blockchain network platform is Ether. Nearly 21 million Bitcoins can be created, whereas there is no upper limit of Ether that can be circulated in the market. 

3. Dogecoin

The history behind the creation of Dogecoin is funny, as it was created to make fun of Bitcoin. Since then, people call it the ‘first joke cryptocurrency’.  After its creation in 2013, it garnered quite a lot of investment.

The functioning of Dogecoin is nothing different than Bitcoin and Ethereum. Among all the Altcoins, Dogecoin is one of the cheapest ones as it sells for 24 cents. The popularity of Dogecoin increased after April 2019, after eminent philanthropist Elon Musk tweeted a positive review about this cryptocurrency. 

4. Tether

While investing in crypto, if your primary concern is the volatility of the market, then you should consider investing in Tether.  It is one of the very few stable coins that are available at present. Tether is designed to minimize the risk by being transparent, and also offers fewer transaction charges in comparison to other cryptocurrencies. Close to 60% of Bitcoin trading takes place via Tethers, as it acts as a trading medium. The current value of one Tether coin is 1 USD.

5. Binance Coin

Binance is used for exchanging cryptocurrencies and in the exchange market it holds the top position at present. At the time of creation, Binance was built by using the same blockchain platform that is used by Ethereum in 2017. When it gained success, Binance separated from Ethereum and is now run on its blockchain platform. In the last few years, Binance has grown a lot.

Nowadays it can be used to book different services including, travel, entertainment, finance, and more. The maximum limit of Binance coins that can be created is 200 million, and half of them can be used by the investors for investment purposes.

Almost a decade ago, when Bitcoin was launched, the craze of investing in cryptocurrencies was not like the one that you can experience nowadays. Cryptocurrencies are quite different from real-world currencies and they are highly tangible. 

Now that you know about different types of cryptocurrency, it is your call whether to invest in any one of these cryptocurrencies or not. But ensure that you keep one thing in mind:  Never invest more than you can afford to lose. 

Don’t forget that the market that revolves around digital currency is extremely volatile. But, if you are willing to take the risk then go for it, as the rewards might be worth it.