While some people stay alert to every single change or development in the crypto industry, there are plenty of people who just know the basics. It’s been well over a decade since we saw the very first cryptocurrencies and a huge percentage of the population is now familiar with crypto and how it works. But there are some different forms of coins now to go with the original (Bitcoin).
Do you know your meme coin from your stablecoin? Let’s explore some of the varieties and what they tend to mean.
Bitcoin – The Original and Most Widely-Used
Starting with the crypto that most people have heard of. Bitcoin was the original in many peoples’ minds and took the cryptography technology theorized about for decades and turned it into currency.
Some people don’t realize the currency was actually made by an anonymous person (or potentially a group of people) known as Satoshi Nakamoto, Bitcoin was designed to be a decentralized digital currency, a form of money that doesn’t rely on banks or governments to validate transactions. Instead, Bitcoin transactions are verified by a network of computers (called nodes) that maintain a public ledger known as the blockchain.
The benefits of using this type of digital coin were quickly spotted and used by certain companies. Gaming took the crypto revolution and started to use the fund in day-to-day purchases. Steam experimented with accepting the currency for some big titles. Players of slot games also may have noticed more options to play digital slots using Bitcoin as a way to move funds around. Playing Bitcoin slots online can provide a way for people to move their money very quickly and also retain a level of anonymity that a lot of players value. They don’t have to wait as long for the funds to be moved and nobody is reliant on a middleman to approve the process such as a bank – this is something that would have happened regularly using traditional., flat currencies.
One characteristic of the currency comes from its limited supply; there will only ever be 21 million bitcoins. Many people see it as a store of value and something that can potentially hold its worth over time similar to precious metals like gold – scarcity could be part of its mechanic for the rest of time. Bitcoin doesn’t have a central bank controlling it which gives it a unique appeal for those who want to escape the traditional financial system and make changes in the way things are paid for.
Stablecoins
No, it doesn’t mean that it is related to horses! Stablecoins are designed to maintain a steadier value than some digital currencies and may achieve this by being pegged to a stable asset, like the US dollar or a basket of goods. In simple terms, the way it usually works is that for every stablecoin issued, there is an equivalent reserve of real-world assets backing it up.
Stablecoin has proven to be popular in some parts of the world and while other crypto forms lead the way in the US there are some examples of countries like Singapore where stablecoin is very popular and keeps setting records for use.
Options including USDT (Tether) or USDC (USD Coin) are used for transactions and trading. They provide a way for people to move money in and out of cryptocurrencies without having to jump back into traditional fiat currencies. This makes them useful in a variety of scenarios, from everyday purchases to large-scale crypto trading or mining.
Investopedia explains the concept as follows: “Stablecoins pursue price stability by maintaining reserve assets as collateral or through algorithmic formulas that are supposed to control supply.”
Meme Coin – Joker in the Pack
Onto meme coins, which is a very well-known category in the crypto universe. These are coins inspired by meme culture. Take Dogecoin, for example, which started as a joke based on the popular Doge meme featuring a Shiba Inu dog. Despite its funny origins, Dogecoin has built a passionate community and even attracted the attention of high-profile figures which drove it to a big market cap. Dogecoin works in the same way as many other cryptocurrencies and still uses blockchain. It may have a sense of humor but the infrastructure is still good for privacy and other benefits of crypto.
Some meme coins, like Shiba Inu, have even evolved to include more functionality, such as decentralized exchanges or NFT platforms. Elon Musk regularly talks about these coins and some celebrities have helped to grow their popularity.
Conclusion
There will likely be more sub-niches and types of cryptocurrencies growing in the coming years as the tech continues to roll out and be used across the world. Privacy coin which focuses even more on anonymity and privacy is another huge development in the industry. People can easily distinguish between the types of coins.
