Ryan Selkis, founder of Messari, who started his Bitcoin career out as something of a mudraking journalist, made a tweet recently we thought we would riff on a bit.
The pseudonymous Satoshi Nakamoto released Bitcoin, the first cryptocurrency, to little fanfare on October 31, 2008. On SourceForge those who were interested in the new digital currency, like co-creator of PGP, Hal Finney, read of Satoshi’s unique implementation of proof of work consensus method and critiqued his white paper.
The actual Bitcoin software would not be released until January 3 2009. That’s when, presumably, Satoshi read of a second bailout. “Chancellor on brink of second bailout for banks,” read The Times. One of those papers today is going for as much as $1 million dollars. He etched the line into the Genesis Block, the first Block along the Bitcoin blockchain, mined by who other than Satoshi himself.
Soon thereafter others began running the Bitcoin software. Perhaps, it was Hal Finney who ran the Bitcoin software second to Satoshi.
There are some basic Bitcoin fundamentals to know. There will only ever be 21 million bitcoins produced through the process of mining, in which bitcoins are created as a reward where after they can be exchanged for other currencies, products, and services.
Miners run computation to secure the network, and the Bitcoin rewards each block are the incentive for doing so. Blocks are expected to be mined for more than the next hundred years––until approximately the year 2140–after which the incentive to mine blocks will be transaction fees.
Proposed in late 2013 by Russian-Canadian Vitalik Buterin, a cryptocurrency writer and programmer, Ethereum has catapulted itself into the blockchain imagination, with large corporations experimented with the technology. An ecosystem of so-called dApps––so-called decentralized applications––are made possibly by Ethereum’s built-in smart contract functionality and Solidity, a turing-complete programming language. A crowdsale provided the funding from July to August 2014. Ethereum went live July 30 2015, when 72 million coins were minted.
Ethereum was certainly inspired by Bitcoin, but differs in many ways. It provides for smart contracts (scripting) functionality and is based on a modified version of proof of work. Ether is Ethereum’s native digital currency. It is generated as a reward to mining nodes for computations performed.
Gas is an internal transaction pricing mechanism on Ethereum useful for mitigating spam and allocating network resources. Ethereum was written in C++, Go, and Python. Amazon, Microsoft Azure, Google, Samsung, and Facebook have experimented with the technology.
Ripple is a real-time gross settlement system, currency exchange, and remittance network. Ripple was first released in 2012, and is built upon a distributed open source protocol that supports tokens that represent fiat currency, cryptocurrency, commodities, and other units of value like frequent flier miles or mobile minutes.
“Low-value payments are now possible,” said Chris Larsen, co-founder and now chairman of Ripple an interview with Fortune. “Now, Ripple can make it easy for Facebook and Uber and Amazon to make payments to developers in real time. It’s online and completely global.”
Ripple enables “secure, instantly and nearly free global financial transactions of any size with no chargebacks.” Ripple’s native digital cryptocurrency is XRP.
Ripple plans to release no more than 1 billion XRP each month, which is governed by in-built smart contracts. Its current circulation is more than 43 billion.
The Ripple company reported interest from banks in using its payment system, with more than 100 banks having signed up by 2018, most of which were using Ripple’s Xcurrent messaging technology, whilst avoiding the XRP cryptocurrency due to its volatility problems, and Ripple touted its use cases for payments of various sizes.
“Banks can send big corporate payments through existing channels or send a small payment through Ripple,” said Larsen. “They don’t have to rip out existing infrastructure; they can use Ripple to make the transactions more profitable or more efficient.”
Representatives at Society for Worldwide Interbank Financial Telecommunication (SWIFT) claim that Ripple’s scalability issues and other blockchain solutions remain unsolved.
“We started out with your classic blockchain, which we love,” Marcus Treacher, senior vice president of customer success at Ripple said in a 2018 interview. “[But] the feedback from the banks is you can’t put the whole world on a blockchain.”
Ripple’s common shared ledger is a distributed database that stores information about all Ripple accounts. The Ripple network is “managed by a network of independent validating servers that constantly compare their transaction records.”
Servers belong to banks and market makers, for instance, and Ripple validates accounts and balances instantly for payment transmission and delivers payment notification with a latency of a few seconds. Payments on the Ripple system are irreversible with no chargebacks.
In its February 2013 edition, The MIT Technology Review called Ripple one of 2014’s 50 Smartest Companies.
A fork of Bitcoin, Bitcoin Cash was released in 2017, with support from big Bitcoin players, like BitMain and investor Roger Ver. In 2018, Bitcoin Cash split into two cryptocurrencies via the Bitcoin SV hard fork. Its native digital currency is BCH.
The idea for Bcash, as it is sometimes called, was hatched due to a lack of a resolution for the Bitcoin block size. Members of the Bitcoin community, including Roger Ver, investors, entrepreneurs, developers, and mostly China-based miners, created Bitcoin Cash. Bitcoin Cash supporters wanted to see more electronic cash characteristics in a cryptocurrency.
“I wish BTC all the luck in the world, but it isn’t the Bitcoin described in the Bitcoin white paper and it isn’t the Bitcoin that I devoted the last 7 years of my life to promoting,” said Ver. “Bitcoin is BCH.”
BCH supporters were not happy with the SegWit proposals to increase the capacity on the blockchain. Bitcoin Cash increased the block size limit to eight megabytes. SegWit refers to the process by which the block size limit on a blockchain is increased by removing signature data from Bitcoin transactions. When certain data is removed from transactions, this frees space or capacity to add more transactions to the chain. Bitmain described plans for Bitcoin Cash as a “contingency plan” in the event that SegWit was adopted.
“Bitcoin’s usefulness as a store of value comes as a secondary effect from its usefulness as a medium of exchange,” reasoned Roger Ver about the motivation behind Bitcoin Cash. “If you destroy the medium of exchange, you destroy the store of value.”
Bitcoin cash is doing a “hard fork” or “effectively a software upgrade,” stock analyst Bryan Kelly said on Fast Money. “When you do a software upgrade, everybody usually agrees. But in this particular case, everybody is not agreeing.”
At the time of the fork, anyone owning bitcoins came into possession of the same number of Bitcoin Cash units.
Bitcoin Cash, which uses Bitcoin’s proof-of-work consensus algorithm, allows for larger blocks in its blockchain than Bitcoin, which should allow the system to process more transactions per second. While Bitcoin allows for 7 transactions per second, Bitcoin Cash allows 61, with both featuring block times of 10 minutes. There will be 20,999,999.9769 BCH mined through the year 2140.
Litecoin is a peer-to-peer cryptocurrency and open-source software project under the MIT/X11 license, which allows the creation and transfer of cryptocurrency, LTC, through an open source cryptographic protocol, not managed by a central authority. Litecoin was an early fork of the Bitcoin protocol, having started in October 2011.
Litecoin is technically nearly identical to Bitcoin. A main difference being that 84 million Litecoins will be mined, compared with bitcoin’s 21 million. Other differences include Litecoin’s decreased block time of 2.5 minutes compared with Bitcoin and a different hashing algorithm––script, not SHA-256.
Litecoin was released on GitHub October 7, 2011 by Charlie Lee, a Google employee, who would go on to work as Engineering Director at Coinbase. The Litecoin network went live October 13, 2011 as a fork of the Bitcoin Core client.
“My vision is people would use Litecoin every day to buy things,” said Lee. “It would just be the payment method of choice.”
In terms of market cap on CoinMarketCap.com, Litecoin was the first top 5 cryptocurrency to adopt Segregated Witness in May 2017. Later that same month, the first Litecoin Network transaction was completed through Litecoin, with 0.00000001 LTC being transferred from Zürich to San Francisco.
The Litecoin block reward is 12.5, halved every four years, and the protocol is maintained by the Litecoin Core Developer team.
EOS’ primary goal is to create a user-friendly and business-friendly tool for building dApps. It also aims to solve the problem of sustainability.
EOS is a smart contract platform declaring that it has eliminated transaction fees and conducts millions of transactions per second. The block.one-developed EOSIO platform, which was first explicated in a 2017 white paper written by Dan Larimer and Brendan Blumer, as an open-source software, ensuring widespread distribution of the native cryptocurrency, EOS. Upon the release of the blockchain, which features a delegated proof of stake consensus model, 1 billion tokens were distributed as ERC-20 tokens.
Block.one raised four billion USD to support the blockchain during the Initial Coin Offering (ICO) period.
EOS’ initial version, dubbed Dawn 1.0, was released on May 7, 2018. Block.one paid a $24 million penalty to the U.S. Securities and Exchange Commission for conducting an unregistered ICO. The settlement did not require a restitution offer, registration of tokens, or disqualifications.
Block.one launched a new social-media application Saturday, Voice, on the EOS digital ledger. Users can post, share and promote content. Every action is registered on the EOS blockchain.