An overview over popular cryptocurrencies

The cryptocurrency market encompasses thousands of digital assets, but a handful of pioneering projects have defined the landscape. Bitcoin, Ethereum, Litecoin, Dash, Zcash, and Monero each represent distinct approaches to the challenges of digital money, smart contracts, transaction speed, and financial privacy. Understanding their differences is essential for anyone navigating the cryptocurrency ecosystem.

Bitcoin (BTC), created by the pseudonymous Satoshi Nakamoto and launched in 2009, is the original cryptocurrency and remains the largest by market capitalization. Bitcoin introduced the concept of a decentralized, peer-to-peer digital currency secured by Proof of Work mining. Its fixed supply of 21 million coins and predictable issuance schedule (halving approximately every four years, with the most recent halving in April 2024) have positioned it as a store of value, often compared to digital gold. The approval of spot Bitcoin ETFs in the United States in January 2024 marked a milestone for institutional adoption. Bitcoin's Lightning Network, a layer-2 scaling solution, enables faster and cheaper transactions for everyday payments while the base layer prioritizes security and decentralization.

Ethereum (ETH), proposed by Vitalik Buterin in 2013 and launched in 2015, extended blockchain technology beyond simple value transfer by introducing smart contracts, self-executing programs that run on the Ethereum Virtual Machine (EVM). This enabled decentralized applications (dApps), decentralized finance (DeFi), non-fungible tokens (NFTs), and an entire ecosystem of programmable blockchain services. In September 2022, Ethereum completed "The Merge," transitioning from Proof of Work to Proof of Stake, reducing its energy consumption by approximately 99.95%. Subsequent upgrades, including the Dencun upgrade in March 2024, have focused on reducing layer-2 transaction costs through proto-danksharding (EIP-4844), further improving Ethereum's scalability roadmap.

Litecoin (LTC), created by Charlie Lee in 2011, was one of the first altcoins and is often described as the silver to Bitcoin's gold. It uses the Scrypt hashing algorithm instead of Bitcoin's SHA-256, which was originally intended to enable mining on consumer hardware. Litecoin offers faster block times (2.5 minutes versus Bitcoin's 10 minutes), resulting in quicker transaction confirmations. With a maximum supply of 84 million coins, four times Bitcoin's cap, Litecoin has positioned itself as a faster, lighter-weight payment network. Litecoin also adopted the MimbleWimble Extension Blocks (MWEB) upgrade in 2022, adding optional privacy and fungibility features.

Dash (originally Darkcoin, then XCoin) was launched in 2014 by Evan Duffield. It introduced a two-tier network architecture consisting of regular miners and masternodes. Masternodes, which require a collateral of 1,000 DASH, enable features like InstantSend (near-instant transaction confirmations) and CoinJoin-based mixing for enhanced transaction privacy. Dash also pioneered decentralized governance through its masternode voting system and a self-funding treasury that allocates a portion of block rewards to development and marketing proposals. Dash Platform, the project's layer-2 solution for decentralized applications, has been under development to expand Dash's capabilities beyond payments.

Zcash (ZEC), launched in 2016 by the Electric Coin Company under the leadership of Zooko Wilcox, brought zero-knowledge proofs to cryptocurrency through zk-SNARKs technology. This enables fully shielded transactions where the sender, receiver, and transaction amount are all encrypted on the blockchain while remaining cryptographically verifiable. Zcash offers both transparent transactions (similar to Bitcoin) and shielded transactions, giving users the choice of privacy level. The Sapling and subsequent Orchard upgrades have made shielded transactions significantly faster and more practical for everyday use, and the Zcash community has been working toward making shielded transactions the default.

Monero (XMR), launched in 2014, takes a different approach to privacy by making all transactions private by default. It uses ring signatures to obscure the sender, stealth addresses to hide the receiver, and RingCT (Ring Confidential Transactions) to conceal transaction amounts. Unlike Zcash, where privacy is optional, Monero's mandatory privacy means that all coins are fungible, as there is no way to distinguish one XMR from another based on transaction history. Monero's RandomX mining algorithm is designed to be efficient on consumer CPUs, promoting mining decentralization. Monero has faced increasing regulatory pressure, with several exchanges delisting it due to compliance concerns, though it retains a dedicated user base that values privacy above all else.

These cryptocurrencies are often correlated with Bitcoin's price movements, as Bitcoin remains the dominant market force. However, each serves a distinct niche: Bitcoin as a store of value and settlement layer, Ethereum as a programmable smart contract platform, Litecoin as a faster payment network, Dash as a governance-enabled payment system, Zcash as an optional-privacy currency, and Monero as privacy-by-default digital cash. Together, they represent a growing ecosystem of financial tools that operate outside the control of any single corporation or central authority, offering individuals and communities an alternative to monetary systems where power is increasingly concentrated. The cryptocurrency market continues to evolve, with each project pursuing its own development roadmap while competing for adoption and relevance in an increasingly regulated and institutional digital asset landscape.

Overview, Glossary, Cryptocurrency, Fiat