Look on any cryptocurrency exchange and it’s clear that despite the media’s obsession with bitcoin, there are hundreds – if not thousands – of alternative coins.
Those who associate cryptocurrency with digital cash will be surprised by the variety, and by the vastly different technological capabilities and applications these coins exhibit. In comparison with their collective forefather bitcoin, some of the strangest evolutions of the original cryptocurrency concept are also the most interesting.
NEM is a cryptocurrency that began in controversy, but has since emerged from obscurity to become one of the most recognized coins. "Created by members of the Bitcointalk forum unhappy with the direction that the NXT cryptocurrency was taking, its ICO was unconventional and controversial,” says Alex Michaelis from CoinSchedule.
Michaelis added: “Only Bitcointalk Forum members could participate, only one stake was allowed per person, and yet the organizer was caught cheating this rule and had to quit. The blockchain was under development for a long time, and when many people thought the project was dead in the water, it boomed and went on to take one of the top 10 spaces in terms of market cap in 2017."
NEM had to hard fork from the NXT chain to implement the one algorithm that sets it apart. Others such as bitcoin’s Proof of Work (PoW) or Ethereum’s Proof of Stake (PoS) protocols were deemed too undemocratic by NEM, as they place too much importance on miners and holders, respectively.
NEM uses a single node’s “importance” (how much and how often it is active in the network) to determine its influence. After a rocky start, NEM released a working product, and it boomed in the beginning of 2017. It is now beloved in the cryptocurrency market, and by cryptocurrency businesses especially. In Japan, its use in the commercial blockchain solution Mijin supports much of the legal cryptocurrency trading there.
NEM is rooted in NXT, a coin that also tried to differentiate itself from existing cryptocurrencies, though perhaps too much. Lauded as the “Descendent of Bitcoin,” NXT launched in 2013 courtesy of an anonymous software developer. It is an open-source payment network that uses Proof of Stake (like ethereum), but keeps mining out of the equation unlike ethereum or bitcoin. No reliance on fickle miners to run the network meant that it would be a more stable platform for applications and financial products, but an overload of functionality lent it an unfocused image.
NXT included a decentralized asset exchange, built-in marketplace, encrypted chat messaging, a voting system, data storage hub along with API and plugin support. The list doesn’t end there. Even developers had a hard time deciding what to do with NXT, and so the team decided to trim the value proposition and relaunch as Ardor, a newer coin that is currently gaining in popularity.
A somewhat silly yet altogether real cryptocurrency, Dogecoin has gained a decent following among the community since its introduction in 2013. Featuring the mischievously cute face of a Shiba Inu dog (a frequent character in many internet jokes), Dogecoin initially released upwards of 100 billion coins into the market. Its large amount of circulated coins and relative indifference to any kind of application or solution has traditionally meant that the price of one Doge is fractions of a cent. However, it’s been popularized as a method for tipping users that contribute to internet forum discussions like Reddit.
In 2013, early cryptocurrency enthusiasts who deemed that bitcoin wasn’t as anonymous as promised broke off and formed ZeroCoin. This was part of another small movement where multiple cryptocurrencies were created to solve the anonymity problem better than the last. Dash, Monero and Zcash are all more private versions of bitcoin. It’s just that Zcash goes about its quest in a very thorough way.
Like any other blockchain technology, Zcash is protected by a layer of cryptography, yet its zk-SNARKs protocol goes one step further. Zk-SNARKs removes any record on the ledger entry of who the two participants were in any transaction. This means that even if a hacker (or the government) were to get a copy of the ledger and the identities of each wallet, there would still be no record that any identifiable people used it. This mysterious cryptocurrency has gained a lot of traction among traders, who have also helped to fuel the expanding market cap of other anonymity solutions like Dash and Monero.
The main argument that economists supporting bitcoin use to justify its value is scarcity. There are only 21 million coins, and if billions of people want it, supply can’t match demand on a 1:1 ratio. This is how Unobtainium (UNO) works as well, but it takes the idea of scarcity to a whole new level. Instead of 21 million coins, there will only ever be 250,000 UNO able to be mined in the next 300 years.
Unobtainium has achieved some notoriety in the marketplace and has gained a reputation as “platinum” in comparison to bitcoin’s “gold” status. Its fair launch was also highly regarded among the community as an example of how it should be done, with no coins pre-mined before the event, and a low reward present on the first 1,000 blocks to give miners time to adjust their hardware.