Newsletter #8 (Premium): Want a better understanding of crypto? Here is a list of the top 10 cryptocurrencies with explanations for their utility.
The top 10 of cryptos, what they are, and why Ethereum is important (and different from Bitcoin)
The market for cryptocurrency
As I put this article to bed, the market capitalisation of all the cryptocurrencies in existence is about $1.88 trillion. That puts the value of all of the digital currencies in the world somewhere between the size of Brazil and Italy! (Strictly speaking, I’m not comparing apples with apples, but hopefully, you get my point!).
The point is that there is a significant amount of the world’s digital wealth tied up in cryptocurrencies already.
A better comparison would be with gold, which has a market cap in the region of $8 trillion, roughly 4 and a bit times the size of the crypto market.
Back in March 2017, the price of a Bitcoin reached parity with gold when they both hit $1,239 at the same time. However, Bitcoin has continued to rise and was trading at around $59k, compared to the price of gold at $1.7k at the time of writing.
So, what makes up the crypto market?
What do we mean by Cryptocurrency?
Cryptocurrency defined: a digital medium of exchange using strong cryptography to secure financial transactions, control the creation of additional units, and verify the transfer of assets.
When we talk about crypto, we really mean 2 different things.
There’s pure cryptocurrency, like Bitcoin and Litecoin (think digital money). These are units of value that can be used to buy and sell things, like a Tesla Model 3, in the same way, that you would use normal money, such as euros and dollars.
And then there’s AltCoins (think casino chips). AltCoins are fungible tokens that are used to run a computer network that performs a specific function. They’re not like normal money and not intended to be used to buy a loaf of bread at Tescos.
If you want to read a good explainer article on Bitcoin and cryptocurrency, go here.