Cryptocurrency

Bitcoin (BTC)

Bitcoin is the original cryptocurrency, and holds it's value because of that fact. It is useless as a day to day currency, with transactions at the moment taking about an hour to clear with a $2 transaction fee. These numbers are slightly misleading, considering the existence of the Lightning Network which makes it slightly more practical, but relying on layer 2 solutions is a band-aid at best. They are susceptible to a much larger variety of attacks than standard on-chain transactions, and are confusing for beginners.

While Bitcoin may serve perfectly well as a hedge to inflation, or a trustless bank account, it is not practical to use as a "cryptocurrency." The final problem with Bitcoin, and one most are tired of hearing of, is it's energy consumption. While Proof-of-Work is still the best way to secure a network, Bitcoin has no defense against ASIC miners, machines built specifically to mine cryptocurrencies. Because of how efficient ASICs are, Bitcoin mining is inaccesible to anyone without buying a specialized machine for it, and the energy cost of securing the network continues to rise exponentially as faster and more energy hungry ASICs are developed.

Monero (XMR)

While Monero suffers from the same transaction time problem as Bitcoin, it holds a crucial property that the aforementioned lacks: Fungibility. From a single Bitcoin, it is possible to trace every time it's changed hands back to the block it was mined. Every time you directly transact through Bitcoin with another wallet, you are exposing your current balance, and all transactions you have ever made before. There are ways to obfuscate this, so called "Bitcoin Tumblers" but they rely on security by obscurity in a relatively small sample size (those using tumblers), and due to the aforementioned lack of fungibility, it's possible that your coins will be "blacklisted" and unable to be withdrawn to exchanges if you do this.

Monero solves this by essentially mixing your coins with everyone else's in every single transaction, making it practically impossible to ever pinpoint who the sender or reciever are, or even the value of a transaction. If you need to make your transaction public for any reason, view keys can be generated that allow verification. The last problem with Bitcoin that Monero solves is the ASIC arms race. Monero fixes this by implementing the RandomX algorithm, which is immune to ASIC miners, and is designed to only be efficient on CPUs. This stops ASIC and GPU farms, and democratizes the network by making Monero mining accesible to everyone. No matter how bad your PC is, your CPU is almost certainly good enough to mine, and Peer2Pool allows miners the benefits of a mining pool without the inherent network security risk of large mining pools.

Ethereum (ETH)

Ethereum is fundamentally different from the above coins in the way that it works. Ether is mined similarly to Bitcoin, and can be sent and recieved just the same, but it comes with a huge extra feature: the Ethereum Virtual Machine. The EVM is a state machine that moves along with every block mined, and enables the creation of Smart Contracts and Decentralized Applications (DApps). It's a way to build contracts as complicated as you want, on an immutable platform. It allows for the creation of ERC-20 "tokens", independent cryptocurrencies that transact over Ethereum, or ERC-721/ERC-1155 "Non-Fungible Tokens", unique tokens that can be used as unforgable collectibles. There are hundreds of automatic, trustless, decentralized applications that exist on the EVM, and the immutable nature of it means it's the perfect trustless broker.

Nano (XNO)

On the surface, Nano appears very similar to Bitcoin, but it is unique in the fact that it's a true modern cryptocurrency, and doesn't try to be anything but that. It uses a unique Block Lattice system, meaning every wallet is actually it's own blockchain. This almost completely mitigates the issue of network congestion, and makes it scale much more efficiently. Instead of Proof-of-Work, network consensus is achieved through Open Representative Voting. Nodes volunteer to validate transactions, and each wallet can choose their representative. The amount of Nano in all of the wallets the node represents is it's relative representative weight, and with there being no monetary incentive and nearly no cost for maintaining a node, with more network adoption the centralization of nodes will actually decrease, unlike most Proof-of-Stake blockchains. Due to this no-incentive representative system, transaction fees can be completely free. Spam is mitigated by a small Proof-of-Work requirement to broadcast a transaction, which takes <1s on modern CPUs.

The #1 problem with cryptocurrency (IMO)

There’s no way to directly, easily, privately, exchange it for cash. Any crypto can easily be exchanged for any other, but it’s a lot harder to get it back into real dollars. Paypal, Zelle, Venmo, all those payment processors would be dead in a day if crypto and cash were interchangeable. Currently, the only way to do this is either through a centralized exchange, which will analyze your transactions, de-anonymize you, and probably freeze your funds just like any other payment processor, or a Bitcoin ATM, which does all of the above but also screws you over on the exchange rate.

But there is a third option, one that solves all these problems and is the only way to truly start the adoption of peer to peer payments: buying and selling peer to peer currencies, peer to peer. If everyone was willing to exchange cryptocurrencies for cash just like splitting large bills, centralized exchanges and ATMs become unnecessary, and crypto becomes true instant global peer to peer cash.

So basically, if you own a business and want to help kill parasitic payment processors and make payments instant, free, and trustless for everyone, start accepting crypto and do cashback for it. A lot of cryptocurrencies are unsuitable for day-to-day transactions due to high block times and fees, but Nano (XNO) has <1s finality and 0 fees, it's as good as cash.

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