This is the first essay in a series of essays on altcoins, trying to be clear about what they are and how they work. Unlike “Bitcoin vs Bitcoin,” this is intended to be technical, and to discuss the technical issues behind altcoins.
Altcoins are coins that follow another coin’s protocol but have some differences from that coin. Deciding which differences to adopt was one of the biggest challenges facing Bitcoin when it was launched. Suppose you want to create a coin, but you don’t want to only make changes where Bitcoin has made a change. You might, for example, want to use Proof-of-Stake as an alternative security model instead of proof-of-work. Or maybe you want to use a different hashing algorithm. If so, how do you do that? The answer depends on what changes were made to Bitcoin by other people and why those changes were made.
The Ripple Effect: How Altcoins Might Change the Cryptocurrency World As We Know It: A blog about how altcoins might benefit the cryptocurrency world and its users by Ryan Fugger (Ryan Fugger)
For today’s essay I’d like to look at one example: Proof-of-Stake (PoS). In this section I will describe what PoS
The Ripple Effect: How Altcoins Might Change the Cryptocurrency World As We Know It (A blog about altcoins and their communities)
“One of the key focuses of this blog will be on the altcoin space, and how such currencies might provide a new way for users to interact with their favorite cryptocurrencies.
The altcoin community has created a great deal of excitement over the past few years and is showing no sign of slowing down. The sheer number of new coins and tokens being created, with different features and systems, means that it is getting harder for newcomers to find the right coins for them.
This blog will serve as an image database for major cryptocurrencies, so that users can find which altcoins are most popular, from a technical perspective.”
The Ripple Effect is the idea that altcoins, particularly the ones that are most popular and successful, will have a ripple effect on bitcoin’s price. The idea here is that altcoin success could be a good thing for bitcoin because it could lead to more people being attracted to bitcoin.
I think this is a good idea in principle, but I don’t think we can apply it in practice. The reason is that people who are interested in cryptocurrency already know about it, and they aren’t likely to be impressed by a new coin just because it has a lot of users.
First of all, if you want to learn about cryptocurrency, an altcoin isn’t the best place to start learning. There are better alternatives. Bitcoin itself really isn’t very user friendly; you have to understand it before you can use it. But there are many other currencies that have some kind of graphical user interface, like litecoin and dogecoin and several others with less-than-stellar reputations for security.
If you want to learn about cryptocurrency, you shouldn’t start with an altcoin; start with something that has been around a while and isn’t going away any time soon like bitcoin or litecoin or dogecoin or one of the better known currencies.
The Ripple Effect (and the broader concept of ripple effects which I define as “the idea that things that affect one thing tend to affect others unrelated to it”) is a way of thinking about how cryptocurrencies might change the world.
I thought I’d write a blog post describing some of those ripple effects, and point out some historical examples.
I’ve written a lot about how the increasing use of cryptocurrencies will change the economy, and how they’ll empower individuals and enable new kinds of organizations. But I’m also interested in how altcoins might affect other aspects of life. For example, what effect would all these new cryptocurrencies have on politics, or on our relationships with governments and banks? Or what about culture? Would we see altcoins becoming an alternative to media companies and Hollywood studios? Could we see altcoins replacing religion? Could you have an altcoin-based religion with altcoin-established churches, altcoin-approved priests, altcoin-required rituals, etc.?
I thought that it was a bad idea to make a coin just for the sake of making one. I thought it would be better to have some sort of idea behind the creation of a new coin, something I could get excited about. And then I discovered cryptocurrencies, and realized that this idea was actually what they were all about.
I decided to create my own altcoin. It was going to be an improvement on Bitcoin, with an upgraded technology and new features I thought would make it better than any other altcoin out there. It was going to be the first truly usable cryptocurrency.
In the past few months, we’ve seen a new trend emerge in the cryptocurrency world: the creation of a new currency based on an old one. In some ways, this is like money-laundering, except that instead of being used to buy drugs or guns, it’s being used to buy altcoins. And instead of using it up in illegal transactions, it’s being used to buy actual altcoins.
The most prominent example is Dogecoin, which began as a joke and has since become one of the leading coins. Dogecoin was created by programmer Billy Markus back in 2013 as a way to make fun of other cryptocurrencies for what he saw as their absurdity. He wanted to make something that wasn’t just entertaining but also useful.
Markus might have been successful even without Bitcoin; he might have created something similar to Litecoin or Feathercoin. But he chose to do it with Bitcoin because he thought there was something missing from Litecoin and Feathercoin: populism.
It’s not hard to see how this works. The first thing people think when they hear about an alternative currency is: “How can I get my hands on some? I want some!” As soon as it becomes clear that the coin isn’t going away any time soon, demand
As a software engineer, I have always found the Bitcoin protocol fascinating. It is amazingly simple and elegant. However, if I were to design it from scratch, rather than mine the existing code and add my own features over time, I would end up with something very similar to what currently exists.
If you want to build something that is useful but different from today’s payment systems, you will probably want to use some other blockchain (such as Ethereum or Ripple) designed for more general purpose.