If 2015 was the year of the blockchain, perhaps 2016 will be the year of alternatives to Bitcoin.
Since midway point 2015, the Bitcoin community has argued to no end about the future of the Bitcoin protocol. The core of the debate revolves around whether the software should be soft-forked or hard-forked, technical terminology relating to the way in which to implement a change to the way Bitcoin works. In this case, the particular change revolves around how much data the system can process per ten minutes, known as the block size. Many people want to increase the block size from 1MB to 2MB.
The uncertainty has slowed some transactions down. In order to be confirmed quickly on the Bitcoin network, you might have to pay a higher fee than in the past. According to many in the Bitcoin industry, this has led to somewhat of an exodus into alternative digital currencies.
Just in the past couple of weeks, markets have changed. While the Bitcoin price remains stalwart, alternative digital currencies have appreciated significantly. For instance, Dogecoin just this week increased approximately 600% before crashing over the weekend in what essentially amounts to a pump-and-dump.
Ethereum, the celebrated Bitcoin 2.0 technology, jumped multiple spots to become the second largest cryptocurrency on the Internet. After a correction, it fell to the number three place. Regardless, this equates into a considerable change for the overall look of the cryptocurrency market.
The private blockchain technology firm, Ripple, has seen the value of their cryptocurrency increase since January 1. Ripple’s market capitalization has increased from $180 million to $220 million.
The Ethereum market capitalization has essentially doubled year to date. Ethereum markets itself as a Bitcoin 2.0 technology that specializes in smart contracts.
Dash’s market cap has increased, as well.
Factom’s market capitalization has increased from $2.5 million to $10 million.
Nxtcoin’s market capitalization has increased from approximately seven millions to $10 million.
Maidsafe coin has increased from seven million to $12 million.
BitShares, a technology seeking to do similar as Ethereum, has also enjoyed a nice 2016 thus far.
There’s only circumstantial evidence as to why this taking place. If you click here, you’ll see a backlog of Bitcoin transactions because of that network’s inability to take on the number of transactions running through the network. To be sure, comparatively with other payment methods, Bitcoin remains competitive.
Because these markets are relatively small, there is always the chance for a pump-and-dump. Thus, it’s not for sure that these increases are legitimately reflective of genuine interest in the coins as speculative, transactional or investment vehicles or manipulation as was the case, it seems, with Dogecoin.
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