4.3 Understanding the Continuing Growth of Cryptocurrency
4: Cryptocurrency
4.3 Understanding the Continuing Growth of Cryptocurrency - Video Tutorials & Practice Problems
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So we've talked about various types of cryptocurrency. We talked about Bitcoin, we talked about Litecoin, we talked about Bitcoin Cash. And all of these are cryptocurrencies which actually have very, very similar functionality to Bitcoin, but they're not the only ones. In fact, what we're gonna do in this lesson is I'm gonna show you how there's a growing universe of cryptocurrencies and these cryptocurrencies do many different things. To do so I'm gonna take you to a specific website, which is available and I encourage you to check it out also where you can see the cryptocurrency market. Let's go there now. So now I want to take you to a website called coinmarketcap.com which tracks the cryptocurrency market. And I am pointing you to this site because this website actually compiles and follows the cryptocurrency market. Some key things that I want to point out to you is the fact that this site specifically, specifies how many cryptocurrencies are available. As of the time that I record this you will see that they're listed 2,177 cryptocurrencies. Now this is not an exhaustive list, there's actually many more than this. It's just turns out that coinmarketcap.com follows currently 2,177 different cryptocurrencies. So Bitcoin was the first one, and you see how this is going by the time you actually are seeing this video, there may be more cryptocurrencies and where there because it is a constantly expanding universe. Furthermore, this site also gives you some very valuable insights that you may be interested in. For example, what is the market cap for the entire cryptocurrency market? Or that is the 2,177 cryptocurrencies that are tracked here. But you also see the 24 hour volume of cryptocurrency that's moving. So we're looking at over $100 billion in cryptocurrencies have exchanged hands in the last 24 hours. Key things I want to point out to you also, this is what's known as the Bitcoin dominance, that is, all of the entire cryptocurrency market that's tracked on coin market cap, what percentage constitutes Bitcoin? As of this moment Bitcoin actually commands about 58% of that market. Now, when the cryptocurrency market started Bitcoin was the only one, but by this point, there's so many other cryptocurrencies that the overall dominance of Bitcoin has dropped and right now is around 58%. And this hovers, and it hovers because as different prices and maybe the price of Bitcoin goes up the price of Bitcoin goes down their percent shifts because Bitcoin is a very volatile space but so is the entire cryptocurrency market. This site actually gives you a peak into all those. So let's just go a little bit about what's listed here. So as you can see, some of the cryptocurrencies we spoke about, we talked about Bitcoin, we've talked about Bitcoin Cash, we talked about Litecoin, you see how they're all listed here. But notice how many more cryptocurrencies are here, and this is not the entire space. You actually can go as I mentioned, there's 2, as of this specific moment. But the specific thing that I want to point out to you for this, is that the cryptocurrency market is a very large and very expanding space and more and more cryptocurrencies are actually coming up on a regular basis. As we go on with these lessons I'm gonna show you how different cryptocurrencies do different things that is, in the case of Bitcoin it is a peer-to-peer electronic cash system but other cryptocurrencies do different things. Let me explain to you now. When you look at the growing universe of cryptocurrency, we spoke that there are thousands of different cryptocurrencies available. As a matter of fact, I showed you that as of this moment there were over 2,100 different cryptocurrencies available, but that number keeps increasing. Now not all cryptocurrencies survive and some cryptocurrencies are phased out while other new ones come in. So it's a very, very fast moving space. We've talked about Bitcoin, and we talked about Litecoin and we talked about Bitcoin Cash and we specified that these are peer to peer electronic cash systems. That is there variations to the original Bitcoin protocol and they address different areas. So there are some variations, for example in the case of Litecoin, Litecoin creates blocks at a faster rate than Bitcoin does. So it's a slight variation to that. Bitcoin Cash has blocks that are larger than Bitcoin. That as you can put more transactions on a Bitcoin Cash block, than you can on a Bitcoin block and notice they're different cryptocurrencies. So for example, if you charge me for a service in Bitcoin, I can't pay you in Bitcoin Cash and vice versa. There are different cryptocurrencies to each other but they are varying and have different variations and they have different price points. But all of these are variations to the original Bitcoin protocol addressing different areas. Now, I want to talk to you about Ethereum. Ethereum is also a cryptocurrency, but in the case of Ethereum, it's not a peer-to-peer electronic cash system. It's a decentralized platform that runs smart contracts. And as we go through this course, I'm gonna talk to you now about smart contracts, which are a key element of what makes blockchain such an important technology. So one key thing I want you to take out of this lesson is that Ethereum can also be used to do electronic payments, just like you would actually be able to pay somebody in Ethereum. But the purpose of Ethereum is to serve as a decentralized platform for running smart contracts. Notice it's a different, completely different use of what Bitcoin, Litecoin and Bitcoin Cash are used for.