There is no doubt that 2017 has been the year of Bitcoin reaching almost $20,000 and going through multiple forks.
But for the first time, altcoins have almost started living their own life, without depending on the Bitcoin price.
If you look at the best performing altcoins of 2017, you will realise that their performance doesn’t depend on Bitcoin extreme fluctuation anymore.
So, without any further ado, let’s clarify the term ‘altcoin’ and see which ones turned out to be the best investment of 2017.
The word “altcoin” is simply an abbreviated form of the phrase “Bitcoin alternative” and encompasses every available cryptocurrency except Bitcoin.
Altcoins are known as an alternative to Bitcoin because they are often created to be an improvement on, as well as an alternative to elements that make up Bitcoin.
There are hundreds of altcoins available and each day that passes, more seem to appear.
Some are just Bitcoin clones, some only have minor changes in characteristics, and some are entirely different concepts. Many do not last for long and fizzle out never to be heard of again, whereas others such as IOTA and Litecoin appear to be in it for the long run.
When it comes to altcoins with staying power, there have been a few new additions to the scene in 2017, and in this article, we will look at them in a little more detail and also discuss their potential impact for 2018.
Many of us who have an interest in cryptocurrency are keen to understand which ones have done well in the last 12 months, as well as which ones are expected to do well as we move into the new year.
The Best Altcoins of 2017
When it comes to popularity, Ethereum is number two to Bitcoins number one.
Created by a 19-year-old mathematical genius called Vitalik Buterin, it is similar to Bitcoin in that it is a distributed public blockchain based currency.
While there are some similarities between the two, it is important to note that they have a lot of differences, especially when it comes to purpose and capabilities.
The main innovation around Ethereum is a Turing-complete piece of software that runs on the Ethereum network. It functions as a cross communication layer, a security layer, and a test environment which allows developers to execute new DAAPS on the blockchain.
Then in February 2017, Ethereum announced the launch of the Enterprise Ethereum Alliance with the aim of developing business solutions using the power of Ethereum.
Since then more and more companies have become involved which has not only boosted Ethereums popularity but has helped secure it as a currency that is not going anywhere anytime soon.
Big names that have come out in support of the currency and the alliance include Microsoft, BP, Intel, Samsung, JP Morgan, Toyota, Cisco, Consensys, National Bank of Canada, Scotiabank, and Mastercard.
If you have heard of Ripple, then the chances are that you will know it is a cryptocurrency that divides opinion.
Incredibly divisive and hated by many, it lacks one of the fundamental elements that drive blockchain support, and that is decentralisation.
While Ripple does not admit this, the fact remains that the majority of its users are banks and financial institutions, which by their very nature are centralised.
Every Ripple token that will ever exist has already been created which means that you are unable to mine, or earn them in a decentralised manner.
The aim of the Ripple model is that it will allow people to escape the “walled gardens” of other financial networks, e.g. banks, PayPal and credit cards which restrict users access through the means of fees, charges, and delays in processing.
They may be controversial and contradictory in some ways, but they do provide significant improvements to the current banking system, and as banks love Ripple, its corporate popularity continues to grow and grow.
Read more about how and where to buy Ripple.
One of the most well-known altcoins, Litecon was launched shortly after Bitcoin.
It is known as the silver to Bitcoin’s gold, and its transactions are done quickly and efficiently, rarely exceeding five minutes. With a vast number of tokens available and a unique mining algorithm called Scrypt, Litecoin has continued to earn its stripes as one of the most stable-priced coins available.
There are even some that believe it will one day overtake Bitcoin regarding value and popularity, and the fact that it experiences very little in the way of blocksize congestion that befalls currencies such as Bitcoin means that it looks like it will be around for a while to come.
It enjoys a high active trading volume and is found in the top 5 cryptocurrencies in the world.
This altcoin runs on the CryptoNote algorithm which was invented to provide multiple privacy features that are not otherwise found in most cryptocurrencies.
Using a concept of ring signatures, the algorithm was able to forget a hole in the blockchain trail of transactions which makes it pretty much impossible to track any transactions between addresses, or to know the number of coins held in an address, as you can with Bitcoin.
Monero is the first non-pre mined alternative to Bytecoin, and it garnered a lot of attention because of its excellent anonymity capabilities.
While there are a few other versions of currencies using CryptoNote, none of them has been half as popular as Monero.
With its value increasing at a steady rate, it is one of the top anonymous currencies that you are likely to find.
This altcoin is a favourite fork in the Bitcoin protocol and has received a lot of support within the crypto-community, mainly from the founder of Ethereum, Vitalik Buterin.
While the programming has been copied from Bitcoin and just adapted, one of its most significant selling points is its fungibility.
What this means is that regardless of what happens, one ZCash will always be completely interchangeable and identical to another whereas with Bitcoin, for example, the coding changes with every transaction.
Hence, it is not possible to identify a ZCash based purely on its records. Also, ZCash functions on a “zero-knowledge proofs” which means that users can encrypt the sending and receive addresses, as well as being able to thoroughly verify the legitimacy of a transaction without having to decipher any data.
ZCash is a favourite among those that like to mine as it has managed to remain entirely profitable when pitted against other altcoins, and also because it has a 2.5-minute average “blocktime”, a 2mb block-size, and it rewards minders with 12.5 ZEC per mined block.
If you are looking for a cryptocurrency to invest in during 2018, you could do worse than pick ZCash!
You can trade Bitcoin for ZCAsh on Bitfinex.
This altcoin is another, much more anonymous version of Bitcoin. It is known and promoted as a privacy-centric currency that offers instant transactions.
It also provides more privacy that Bitcoin as it functions on a decentralised master node network that makes transactions almost entirely untraceable.
Its transaction times are extremely fast, and you can choose from more functionality for a transactional fee, and it is very well suited to retail.
It offers something called “Instasend” which is a feature unique to Dash that makes use of something called “transaction locking” which helps users avoid the issue of “double spending” and helps you move your coins from A to B in mere seconds.
It also offers “Privasend” which is a currency mixing feature that allows you to shuffle your transaction with others to maintain anonymity.
Through a partnership with various other companies, they also offer a “crypto-to-fiat” debit card that allows you to make purchases anywhere that accepts a regular debit card.
This, combined with its transaction speed and level of privacy, made it a huge success in 2017, and its predicted, an even bigger one in 2018!
This cryptocurrency was created with the sole purpose of supporting the up and coming Internet of Things sector.
Its capabilities go far beyond that off blockchain, and it offers a block-less distributed ledger known as “Tangle”. This allows IOTA to offer its users an unprecedented zero-fees on all transactions, as well as no limit on the number of transactions that can be completed per second.
The Tangle ledger also allows users to conduct nano payments, leasing of smart devices and offers unique scalable technology that it’s expected to encourage several new applications as we move into 2018.
Many believe that IOTA has barely touched the surface of its potential and that there are a lot of bigger and better things to come.
One of the characteristics of IOTA is that it cannot be mined as all of the tokens that will ever exist have already been generated (a total of 2.77 billion in circulation), and this means that it reduced the coins complexity, centralisation, and its level of energy use.
IOTA is expected to be one to watch, and after a fantastic 2017, it is well worth considering for 2018.
Altcoin Predictions for 2018
With Bitcoin rising to values that make it inaccessible to many investors, people are looking to other altcoins to spend their money on.
If you are someone that has been thinking about getting involved in the world of cryptocurrency, then you should consider making 2018 your year.
While the very nature of cryptocurrencies means that they are rather volatile, they are worth investing in, especially if you pay particular attention to past performance to be able to make predictions judged on its stability.
The seven altcoins we have mentioned in this article are all expected to go strong in 2018, but we do have some other predictions for popular options.
This coin is currently listed in the top 40 based on its market cap that rests just above $200 million with just over half of its available coins in circulation.
But it is more than just a currency, Siacoin is a product. It provides users with a decentralised storage space that is safe and secure from hackers, giving Google Drive and Dropbox a serious run for their money.
Set up by a start-up called Nebulous Inc in Boston, they have put more focus on the quality of the product they are creating, rather than marketing.
Steem is another altcoin tipped for success in 2018. It doesn’t need to be mined using GPUs or CPUs and can be earned by anyone.
You need to use a blogging/social media platform called Steemit to earn your Steem and then you can convert it into Bitcoin and fiat money such as USD.
When you post on Steemit, your posts and blogs are voted on by other members of the community and these result in something called Steem Power.
The higher your Steem Power, the more a vote from you is worth, e.g. if your Steem Power is over a million (1 million USD) then an upvote can be worth a few hundred dollars, whereas those with less Steem Power may only see their votes worth a few cents.
As the name suggests, FunFair is something of a novelty coin. That said, it does have some genuine staying power for 2018.
It was given out as an ICO not too long ago, and it raised a pretty impressive $26m. While it was only launched a few months ago and trades at a pretty low price, it is expected to increase.
At present, there are 3 billion FUNs in circulation, out of a possible 17 billion, and FunFair is the very first blockchain-based casino that is entirely safe to use.
It works as a completely legitimate casino and anyone can take part as long as they have some tokens.
One of the best things about it is that everything is recorded in the public ledger and it is pretty impossible to cheat with, as everything can be traced back to you.
Are Altcoins Worth Investing?
Some of the most prominent altcoins, such as Ethereum or Litecoin have an established reputation, similar to Bitcoin.
These, however, are already priced much higher, and the initial investment would also have to be bigger.
The majority of these altcoins have been created a few years back, so investing in of the best performing altcoins of 2017 will likely be a long-term success.
However, the most exciting part of 2018 crypto-space will be ICOs entering the exchanges and becoming trading altcoins.