Here’s undeniable proof that Bitcoin is on to something big: it’s inspired more than 140 copycats.
From AnonCoin to Zeuscoin, a veritable alphabet of cryptocurrency has popped up in the wake of Bitcoin’s mainstream success, mostly in the past two months. And while most of us think of ripoffs as just that, some Bitcoin clones are gaining serious traction.
Whether you think Bitcoin is the next big thing or just a flash in the pan, the prevalence and popularity of its alternatives show Bitcoin’s evident effect on our willingness to accept currencies that can be mined out of bits of computer code. Here are just a few of them:
Currently, litecoin is the strongest alternative to Bitcoin. In late November the total value of litecoin in circulation surpassed a billion dollars. As of this publication, one litecoin is worth about $30, which makes it a far more affordable alternative to Bitcoin right now.
Just like Bitcoin, litecoin is a cryptocurrency mined from the blockchain, and there is a limit (84 million) to how many litecoins will ever be mined. The difference is that, while Bitcoin aficianados can expect to pay around $10,000 a pop for tools to mine Bitcoin, litecoin can be mined just as efficiently with consumer-grade hardware.
Hot on the heels of litecoin, the total value of Namecoin in circulation passed $100 million the same day a single Bitcoin was first worth $1000. One Namecoin is worth about $8.50, and there will be no more than 21 million Namecoins ever in existence.
Namecoin takes Bitcoin’s promise of privacy to the next level. It acts as its own decentralized DNS—the go-between service that translates human-readable domain names like Google.com into machine-readable address. In this way, Namecoin is operating outside the bounds of the Internet as we know it, and therefore outside the influence of ICANN.
Currently worth about $6.50, the total value of Peercoin in circulation recently became equivalent to $100 million. Unlike the other cryptocurrencies listed here, Peercoin is never expected to reach its mining cap, placed at 2 billion. According to its creator, software developer Sunny King, this cap is only for “consistency checking” and can easily be raised if need be.
Peercoin advertises itself as a safer, stronger Bitcoin. It shares much of its source code with Bitcoin, but claims to be more powerful because it lacks a mining cap. King says this makes Peercoin better mimic gold, which doesn’t have a known money-supply cap either.
Primecoin is the second cryptocurrency invented by Sunny King. It’s currently worth about $5.50 with an $18 million total circulation equivalency.
Primecoin gets its name from the unique algorithm used to mine it. Bitcoin miners use a hashcash algorithm, which acts as a proof-of-work to verify legitimate Bitcoins and eliminate duplicates. Primecoin miners, on the other hand, look for Cunningham chains, long strings of prime numbers. As it turns out, increasingly enormous prime numbers are exceedingly valuable for RSA encryption, which allows two users to pass secret messages back and forth, and has been the standard for confidential message encryption since the 1970s.
Relatively similar to Bitcoin in most other ways, Quark drastically improves on Bitcoin’s security measures by using nine rounds of secure hashing from six different algorithms. For comparison, Bitcoin uses just two rounds. That makes Quark one of the most secure competitors, and its accessible open source code should keep it that way.
Like many of the others on this list, Worldcoin is very similar to Bitcoin excepting improvements in one area. In this case, it’s speed. Worldcoin has a 30-second transaction time, making it 20 times faster than Bitcoin. While it could take all day for your Bitcoin transaction to be verified a dozen times, Worldcoin transactions are fully verified in 60 seconds.
Bitcoin has opened the floodgates to cryptocurrency transactions, but the fact that people are adopting its spinoffs in such large numbers shows that it isn’t perfect. Most of these alternatives probably won’t stick around, but the innovations they’re building on top of Bitcoin are paving the way for the cryptocurrency of the future.
Photo by btckeychain