How to separate the hidden gems in the cryptocurrency world!

Watching the BITCOIN & ETHEREUM buying frenzy of the last months, many people are trying to jump in the Cryptocurrency world. However they soon feel lost. The reason? They are finding out that there arethousands of projects. Each project releases its own coin or token and claim that this is a “cryptocurrency”.

Butwhat is a “Cryptocurrency” exactly? Who can give a serious answer to this question ?

BITCOIN: Only here you can find the answer about “What is a cryptocurrency”

The legendary Bitcoin was the first cryptocurrency. The reasons behind its launch and its functionality can help us to understandwhat is a cryptocurrency.

Anonymous founders under the pseudonym “Satoshi Nakamoto” launched Bitcoin with these basic characteristics :

1. It created atransactions networkthat would offerfreedom to the world. With itsblockchaintechnology, everyone would be free to make borderless transactionswithout the need to trust any third partylike a bank or a financial company. The coins are not issued or controlled by any centralized authority!

2. It was supposed to makeeveryone able to participatein its network with a PC. This is what we callmining procedure(Proof of Workmodel) and the members of the network could enjoy meaningful mining rewards.

3. It was designed in order to give everyone anequal chanceto get it. This is called “Decentralized” coin distribution and its prerequisite is afair launchwithno premineandnoICO sales.Without any developer getting the lion’s share of the coin supply.

4) To act as adeflationary assetwith afixed maximum supplyand a definedmining reward planwith halvings every 4 years for the block rewards.

5. To offerequal rights for alllike a public transactions history accessible by everyone andanonymityfor the transactions.

The five flaws of Bitcoin that came up over time

BITCOIN was certainly the greatest invention of the second Millenium. Even its anonymous founders possibly could not have imagined that it would be so successful.

However, exactly because of its huge popularity and wide use, some shortcomings arised for the totally immutable Bitcoin project:

1. Itspoor scalability: BITCOIN is limited by the average block creation time every 10 minutes. So itcould not offer more than 7 transactions per second which are not enough for thecryptocurrencyusers.

2. Itslow supply: BITCOIN has just a few million coins as circulating supply (21Mmax supply). This fact together with its high popularity results to a high valuation and very long non-integer prices (for example 0.0000231 BTC) which are not very friendly for everyday use.

3. Itsfees rised too much:  Its low coin supply in combination with its high valuation and popularity made its fees very high. The user for a single transfer can pay even $20-35 which for a sum of $100 is20-35%! These numbers could be even worse soon. Of course small sum transactions with these fees are out of question.

4. TheASICsproblem: Specialized mining devices (ASICs) that could solve Bitcoin’s algorithm soondominated its network. The common PC miners could not get any mining rewards with the huge competition by the ASIC owners. This made the coin distribution of the Bitcoin coins morecentralized, in the hands of very rich people only.

5. Thelack ofprivacy: The BITCOIN provided some anonymity in the beginning. However all its transactions are recorded and are available in public view. With so many applications associating personal details with specific btc addresses, there is no anonymity at all now. The need forprivacy optionsis more than obvious.

How we ended up with so many “cryptocurrencies” ?

The aforementioned were the major challenges that other cryptocurrency projects had to find solutions for.

However we had an unfortunate event: In the very youngcryptocurrencylandscape, many developers tried totake advantage of the people’s ignorance. Μost newcomers in this brand new world, don’t understandthe fundamental characteristics of Bitcoin. We described them in the first section of the article and these constitute the very essence of acryptocurrency.

So, the majority of the cryptocurrency projects are advertising that they offered one or a couple of solutions for the five bitcoin’s shortcomings. But at the same timethey have cancelled the mostof, or even all, the five structural elements of a cryptocurrency!

The most usual violation of the basic cryptocurrency fundamentals is thepresence of a central authoritythat not onlytakes decisionsbut it evenissues digital coins.  Thousands of “crypto” projects actually  issue and control coins as a central authority, allocating them in specific founder’s addresses (Premine–ICO sales). Then, with heavy promotion they technically rise a high demand for these coins and tokens. This way, the founder who has a big part or even thewhole coin supplyof the project on his own hands, is making money out of nothing!

Thereby, these projects have already broken the first, the second and the third crypto fundamental rules that had been previously described. Unfortunately this is the most common breach. More than the 99% of the coins or tokens thatclaimto be a cryptocurrency right now,don’t fulfill the most (or even all)of the five fundamentals that the legendary Bitcoin has introduced.

Some very popular examples of projects that in reality are not cryptocurrencies

It is shocking that even popular projects like ADA, XRP, NEM and many more have acted exactly with the aforementioned method. Projects that we now find in the top positions of the cryptocurrency market’s capitalization list!

Another popular example that many people ignore is the ultra successful Ethereum. Ethereum is a70% premined project. That means that the 70% of the initially ETH coins in circulation, were allocated to its developer adresses and sold inInitial Coin Offering.

Another characteristic of the Ethereumblockchainis that there isno maximum capfor the Ethereum coin supply. It implements a completely different approach that in combination with its “Defi” smart contract functionality leads to extreme inflation instead of deflation.

Finally, the ethereum chain and many others that followed its model, are acting as “tokenizing factories“. This functionality might seem quite interesting at a first glance but it actually inflicted an even bigger wave offraudulent projectswithuseless tokens. These “easy to make” tokens that are automatically added in certain eth platforms, attracted even more fraudulent wannabe project founders.The aforesaiddevelopers can now launch their next useless tokens even more easily. Then with marketing tricks they make these projects popular cashing out theirpreminedcoins and repeating this procedure again and again.

Thus, we can already see a series of negative effects because of the very increased traffic in the Ethereum blockchain. This situationhas inflated the network fees to insane levelsof even $150+. Yes… the user has to pay fees like $150 in order to move a sum of tokens or ethereum coins that might have a value of $50 or even lower (!). Countless tokens are stagnant in the ethereum blockchain because of this side effect and the worse thing is that many other projectstry to copythe ETH inflative model.

The result of all these : The Good, the Bad and the Ugly!

The above have resulted to a very dangerous cryptocurrency landscape with:

–The Good: Extremely few pure cryptocurrencies thattruly serve the initial cryptocurrency idea. These are the real gems that shine but people cannot always see them because of the thousands other “noisy” projects.

–The Bad: Many projects that in reality arepreminedcompany-driven projects and service providers. Here belong the most popular “defi” platforms as well. Their ecosystems are full with mostly meaningless tokens that are mostly included in the next, even worse category.

–The Ugly:The worst of all, thousands of fraudulent and scam projects, with huge premined percentage, that provide no service or functionality at all. Most of them are tokens, built using the services of the most popular platforms of the second category.

“Use Cases of our coin”:  a hype that you should be skeptical about!

Obviously, the projects of the second and especially the third category haveno relationwith the originalcryptocurrency idea.

It is not bad for a project trying to provide a service or to provide a service for a price. However this isnota cryptocurrency with the original meaning. It isjust a company using the blockchain technology. A company that serves the personal goals and ambitions of its founders and not a noble cause for the world community like the Bitcoin idea.

Many people seem to misunderstand the need for extra“use cases”that some projectsintentionally tend to hype. We should be able to separate the projects that are in abad needto get more use cases,“a reason for existence”. Since theyhave to prove why they had been preminedwith their founders getting the lion’s share or all the coins of the project in their pockets! In contrast with the few real cryptocurrencies that theirfair fundamentals and rulesarethe reasons to exist and enjoy popularity over time.

A cryptocurrency was supposed tofreepeople from any central authority issuing or controlling funds. A cryptocurrency was supposed to offer realDecentralization, fair rules and cheap borderless transactions.

The 99+% of the cryptocurrency projects aretotally unrelatedwith the above. In the best scenario, some of them act as companies and service providers . In the most usual scenario, they act as scam projects with one single target: To make their founders rich with rug pulls.

People need to realize that extra use cases or even “Defi” functionalitiescan be developed and added anytimein the future to the few pure cryptocurrencies of the first, previously mentioned, “Good” category. Οn the contrary a fair past and transparent launchcan never be added to the cryptocurrenciesof the second and third categories. Regardless of the popularity that some projects enjoy, climbing even in the very top50 places for a long time, they are extremely far away from the original cryptocurrency idea and this is not going to change.

Some real crytocurrency gem examples

The real cryptocurrencies, that honour thefive fundamental characteristicsthat Bitcoin has introduced, arevery few. A very good research is needed in order to separate them among the many thousands of other projects.

Some good examples, except the legendary Bitcoin, are:

Litecoin (LTC):Acting with the logic of the Bitcoin, with fair launch and rules. It offered a faster alternative crypto with 10X higher supply than Bitcoin’s and lower fees. It is among the most popular real cryptocurrencies right now. Unfortunately it didn’t offer private transaction and the worst shortcoming is that it hadn’t ASIC resistant algorithm. Thereby ASIC miners have dominated its network.

Monero (XMR): A popular cryptocurrency for its by default private transactions. Monero offers much lower fees than Bitcoin, faster speed and decentralized coin distribution because it switched to ASIC resistant algorithm making everyone able to mine with his PC. However its supply is lower than Bitcoin’s and this could potentially make its fees expensive in the future. Additionally the decrease for its mining rewards is faster than Bitcoin’s. The 90% of its supply has already been mined despite the fact that it is 5 years younger than Bitcoin. This fact in combination with its already high popularity and increased mining competition, could possibly demotivate those who seek more meaningful mining rewards.

Digibyte (DGB):An impressive altcoin that offered many solutions to the most Bitcoin “flaws”. With its faster speed, high supply, very low fees and unique features.  Parallelly it made it to fulfill all the pure cryptocurrency fundamentals with only a small discord : it had a minor ~0.5%premine. It has a sophisticated 5x mining algos model combining ASIC, FPGA and PC miners. However the room for the PC miners is small and there is no privacy option.

Theexceptional case of BITCOINZ

BITCOINZ (BTCZ)is a pure cryptocurrency thatoffers solutions to all the five “flaws”of the legendary Bitcoin (described in the next paragraph).

At the same time BITCOINZ  fulfillsallthe five fundamentals of a pure cryptocurrency :

1. It was founded by anonymous founders and it is a100% Community Drivenproject, withno central authorityissuing coins.

2)100%of its coin supply is distributed to its network’s supporters (miners) with theProof of Work model. Everyone if free to join it with themining procedureusing just a PC.

3. It had the fairest launch ever with absolutelynopremineandnoinitial coin offerings.

4. It is adeflationary assetas it has afixedmaximum supplyand reduced coin emission over time withfair and slow mining halving plan.

5. It offers the same rights and level of privacy toeveryone.

How BITCOINZ fixed all the flaws of the classic BITCOIN?

1. Itshigh scalabilityoffershigher transaction speedand plenty of space for future improvements.

2. BITCOINZ’s high maximum supply is the ideal foreasier priceswithout long non integer numbers.

3. Its fee model in combination with the 21B coin supply guaranteessuper low, next to zero fees. BitcoinZ is ideal for transfering evenvery small sumsof under $1 with~0% cost.

4. BITCOINZ’sASICresistantalgorithmis protects the PC miners from theASICelites. This way it achieves afair Network with truly decentralized distribution of coins to the world Community. Not to the rich people only.

5. BITCOINZ featuresprivate transactionsofferingtrue privacyfor everyone.

6. BITCOINZ is agreenProof of Work Network since a) it utilizes a much more energy efficient algo than BTC b) the users can use their PCs for other activities while mining BTCZ because only the GPU is (mildly) used for the process and c) it supports more transactions per second with plenty of space for future upgrades.

Obviously, BITCOINZ is maybe the only cryptocurrency out there that achieves tofixall the five major BITCOIN’s flaws.

At the same timefulfilling and honoring allthe Bitcoin’s five fundamentals. These are the aforementioned necessary pillars that should accompany every pure cryptocurrency.

Why BITCOINZ uses the “BITCOIN” name and why it is really different from the so many projects that used it.

BITCOINZ used the “BITCOIN” name adding a Z because it honored and followed all the fundamentals that the classic BITCOIN introduced (fair rules, 100% Community Driven, 100% Decentralized, 100% Proof of Work) and at the same time it offed Zero fees, PC-mining only with its Zhash algorithm and optional privacy based on the Zk-snarks cryptography. So there was no better name to describe all these than “BITCOIN+Z”.

It is worth mentioning that BITCOINZ is the oldest and maybe the only “BITCOIN” named project that can still be mined with a normal PC and it isnotaBitcoinblockchainfork, as it had its owngenesis block!

The most of the other crypto projects that have used the “Bitcoin” name, did it afterwards, in a misleading way or they are just copies of the BITCOIN’s blockchain (chain-forks) that have given free coins (forkdrops) to the Bitcoin holders. In such a way, these “BITCOIN” named projects try to enjoy a high free exposure by distributing coins to the BITCOIN owners. Sometimes bad actors from the BITCOIN chain-fork projects even try to steal the private keys from the BTC owners that claim their free coins.

In contrast, BITCOINZhad its own unique blockchainexactly like Bitcoin did and never made any forkdrops. Offering equal opportunities to everyone by distributing the 100% of its supply to the whole world Community andnotto a closed team. Like a real cryptocurrency should be destined to do, like a gift of Freedom and Equality.