itcoin spawned an entire market of alternative cryptocurrencies. Today there are more than 5,000 of these ‘altcoins’.
Altcoins can be a good way to diversify your crypto holdings, especially given the additional functionalities they offer.
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1. Ether (ETH)
Ether is Ethereum’s native token and the world’s second-biggest cryptocurrency. Ethereum is a global software platform that runs decentralised applications, smart contracts and financial transactions, as well as minting and storing Non-Fungible Tokens (NFTs).
Launched in 2015, ETH has amassed a market cap of over £144 billion as of July 26,2022. The crypto’s value peaked at £3,815 in August 2021, and each token is now worth £1,165
2. Bitcoin Cash (BCH)
Bitcoin Cash was the result of a hard fork in the original bitcoin project in 2017. A breakaway group of contributors wanted to increase the size of blocks in Bitcoin’s blockchain to contain more transactions.
Bitcoin Cash has the same proof of work consensus mechanism and the same hard cap of 21 million coins as Bitcoin. As of July 26 2022, one Bitcoin Cash token is worth £95.51.
3. Litecoin (LTC)
Litecoin was one of bitcoin’s earliest challengers when it launched back in 2011.
Litecoin uses a proof-of-work consensus mechanism like bitcoin, meaning new coins are minted to reward miners for processing transactions on its blockchain. However, Litecoin’s newer Scrypt algorithm makes transactions faster than bitcoin.
Litecoin peaked at £326 in May 2021. As of July 26 2022, one LTC is worth around £44.
4. Solana (SOL)
Like Ethereum, the Solana blockchain was built to host decentralised applications (dApps). A relative newcomer, Solana and its SOL cryptocurrency launched in 2020.
Solana’s low transaction fees work out far cheaper than its competitors’. The Solana blockchain can process up to 65,000 transactions per second via a‘proof-of-history’ process.
A time-stamp affixed to each block creates a permanent record of transactions in the order they were made. As of July 26 2022, SOL is worth £29.53.
4. Cardano (ADA)
Created by an Ethereum co-founder in 2017, ADA is the native cryptocurrency of the Cardano blockchain. Cardano uses a proof-of-stake consensus mechanism to verify transactions rather than proof-of-work.
It requires far less energy than its proof-of-work counterparts, since users on the network stake their own tokens for the chance to become a validator rather than use power-hungry machines to crack the cryptography used in proof-of-work systems.
On July 26 2022, one Cardano was worth 38p – down from a peak of £2.45 in September 2021.
5. Dogecoin (DOGE)
What began as a parody of cryptocurrencies quickly became the world’s biggest memecoin.
DOGE hit the exchanges in 2013 and used distributed ledger technology derived from Litecoin.
The memecoin peaked in value in May of 2021, reaching 46p. Much of DOGE’s positive price movements have followed backing from Tesla founder and entrepreneur Elon Musk. As of July 2022, however, DOGE’s value has fallen to around 5p.
Read More: 2022’s top five altcoins | Evening Standard