Bitcoin has caught the public imagination with a phenomenal price surge from $900 at the start of last year to a peak of $20,000 by the year end.
Some fortune seekers have allegedly made millions from the soaring value of the cryptocurrency.
But the rush for cash covers around 700 more cryptocurrencies – collectively called altcoin.
To join the pack, a cryptocurrency must have:
- An encrypted security system like Bitcoin’s blockchain, which manages online transactions and electronic wallets
- Cryptocurrencies are outside of the control of any regulator, government or central bank
Bitcoin is now valued at around $10,536 – a big drop from top dollar for speculators who bought into the market high, but an indication of the volatility of the market.
Other pretenders are seeking to topple Bitcoin to take the altcoin crown – and here are two of the most popular.
Sleeker and faster altcoin
Sleeker and faster altcoin are now attracting attention away from Bitcoin because their technology works quicker, and fees are cheaper.
- Ethereum is a system for securing contracts with tokens called ether.
Bitcoin allows sending and receiving the cryptocurrency, but ethereum lets developers impose contract conditions on when and how much ether is released.
Ethereum has shifted upwards from around $10 at the start of 2017 to trade at around $1,000 now.
- Litecoin was designed as a low-level cryptocurrency for small transactions, like buying a meal or some shopping. Transactions are lightning fast compared to lumbering Bitcoin.
A year ago, Litecoin was trading at $3.77, now the rate is nearer $200.
Should you invest in cryptocurrency?
The answer depends on how you feel about risk.
Banks, fund houses and other conventional finance institutions say no – it’s a gamble not an investment and warn that the bubble may burst leaving you without any cash.
The money men are also concerned that a lack of regulation and oversight leaves altcoin networks open to scams, hackers and crooks looking to make some money where they cannot easily be traced.
The story of Bitcoin is littered with fraud, hacking and accusations of money laundering by organised crime.
Others say yes, cryptocurrency is king, but beware as many of these profiteers may be driving up the price in their favour.