Bitcoin is the oldest and most popular digital currency in the market . However, there are more than 1000 different digital coins (known as “altcoins”) that can also be bought and maintained as an investment. In this guide, we will compare four of the most popular altcoins with bitcoin, so you can familiarize yourself with other possible investment opportunities in digital currencies.

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If you are satisfied with bitcoin’s high-risk, high-yield profile, then it might be useful to diversify your digital currency portfolio by buying one or more of the digital currencies mentioned below. Not only could you benefit from a risk reduction through diversification, but you could also increase your overall returns in case any of your investments outperforms your other peers.

Bitcoin vs. Litecoin (LTC)

characteristicsBitcoinLitecoin
UsePayments Peer-to-peerPayments Peer-to-peer
Performance (2017)1500%6000%
PopularityhighLow
Total Supply21,000,00084,000,000
Rank (Market Cap)15

 

When Litecoin was first launched in 2011, it was considered “the cryptocurrency digital silver,” with Bitcoin representing Gold. For a long time, that was the case. Litecoin quickly emerged as the second largest digital currency after Bitcoin, measured by market capitalization. The altcoin even experienced a degree of commercial adoption in its early years.

Its popularity faded a bit when the Ethereum project and its native digital currency, ether, became the second largest digital currency in 2016. However, when it was announced in early 2017 that litecoin would adopt the so-called “SegWit” update for his blockchain, which addresses blockchain scale problems, litecoin’s price soared from its 2-year operating range of $ 3 to $ 5 to reach a new historical record of more than $ 366 on December 19, 2017.

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Litecoin has become a very popular digital currency because it has all the benefits of bitcoin but with faster transaction times and lower transaction fees . This is the reason why many digital currency experts believe that it has the potential to challenge bitcoin as the main digital currency of the future. This belief is shared by many digital currency investors, which may explain why the price of litecoin has increased by more than 6000 percent so far this year (2017).

If you think that the global adoption of litecoin (LTC) will increase because your transactions are faster and cheaper than bitcoin, then adding some litecoins to your portfolio could be the right move.

Bitcoin vs. Ethereum (ETH)

characteristicsBitcoinEthereum
UsePayments Peer-to-peerSmart contracts
(integrated payments)
Performance (2017)1500%7500%
Total Supply21,000,000Unlimited
Popularityhighhigh
Rank (Market Cap)12

 

Ether, Ethereum’s own cryptocurrency , is the second largest digital currency in the market with a market capitalization of more than $ 75 billion (at the end of 2017). Ether is the digital currency of the Ethereum block chain, which is an open source blockchain platform that allows the creation of so-called “smart contracts”.

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he intelligent contracts are software protocols that create digital contracts to facilitate, monitor and enforce contractual agreements between two parties. These contracts may also include self-executing payments when certain contractual agreements are met. The currency for these payments is the ether.

The blockchain of Ethereum has gathered substantial interest from financial institutions and corporations who believe that the ability to store and transfer data securely using blockchain technology combined with self-executing smart contracts will reduce operating costs and streamline business processes in the future. For this reason, Ethereum has become the second largest block chain and its currency has skyrocketed to become the second most valuable digital currency in the market.

If you think that smart contracts will play an integral role in business in the future, then adding some ether to your portfolio could be the right step.

Bitcoin vs. Ripple (XRP)

characteristicsBitcoinRipple
UsePayments Peer-to-peerInterbank Payments
Performance (2017)1500%30,000%
Total Supply21,000,000100,000,000,000
PopularityhighLow
Rank (Market Cap)14


Ripple
 is currently the fourth largest digital currency with a market capitalization of $ 50 billion. It is the digital currency of the Ripple Interbank Payment Network, which aims to provide a framework for high-speed, low-cost payments to financial institutions around the world.

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Currently, more than 50 banks in Europe, Asia, Australia and the USA. UU they have implemented the Ripple payment system , while more than 100 banks have participated in a test of the Ripple payment network in an attempt to implement this new and innovative payment technology with cost reduction.

If you believe that Ripple’s Global Payments Network will become the standard for inter-bank payments, then adding Ripple to your digital currency holdings could be the right move.

Bitcoin vs. DASH (DASH)

characteristicsBitcoinDASH
UsePayments Peer-to-peerPayments Peer-to-peer
Anonymous
Performance (2017)1500%10,000%
Total Supply21,000,00018,900,000
PopularityhighLow
Rank (Market Cap)18


DASH
 , which means “digital cash”, is currently the leading digital currency based on anonymity. It has a market capitalization of $ 10 billion and is the eighth largest digital currency in the market.

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The media regularly state that Bitcoin is anonymous. However, that is really incorrect, since all transactions can be publicly viewed in the bitcoin blockchain and each transaction is linked to a bitcoin wallet address. While the addresses of the bitcoin wallet do not contain personal information of the owner of the wallet, several methods of analysis have been created that allow the addresses of the wallet to be linked to the IP addresses to expose the holders of bitcoins and their transactions.

For this reason, anonymous digital currencies, such as DASH, have gained popularity as users of digital currencies increasingly value privacy when making financial transactions. DASH not only allows users to conduct transactions anonymously , but also allows users to make instant transactions with transaction fees lower than Bitcoin. These three combined characteristics have been the key drivers behind the increase in popularity and market value of DASH.

If you think that people will move more and more towards the use of completely anonymous digital currencies to make transactions, then buying DASH for your wallet could make sense.