2 votes

What will be the next Bitcoin? What alternative Crypto Currencies are you looking at?

We all know about Litecoin and if you are paying attention it has been spectacular in its rise in price recently. That being said, what other cheap crypto currencies are you looking at?

I recently cashed out a litecoin and bought several Mincoins.
They promise a 1 minute transaction time, which is the fastest I have seen so far...

What do you guys think?

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.

+1!!!!!!

i'm getting ready to further diversify my cryptocurrency portfolio tonight. i already own litecoin (@$3-4) and i'm going to get some namecoin and probably a little primecoin too.

here's my comment from another thread...
"mastercoin and namecoin do some interesting things and zerocoin will be big when it comes out. i also like the idea of primecoin. and i can't leave out litecoin which has been outperforming bitcoin the last day or two.
the gov (irs) will eventually try and catch btc users through the block chain (good luck) so weaving in and out of alt coins like zero coin will be useful. btc to zerocoin back to a self-mixing btc wallet like dark wallet will make it all but impossible to track."

here's a thread i just posted...
Beyond Bitcoin: A Guide to the Most Promising Cryptocurrencies
http://www.dailypaul.com/306558/beyond-bitcoin-a-guide-to-th...

Official Daily Paul BTC address: 16oZXSGAcDrSbZeBnSu84w5UWwbLtZsBms
My ฿itcoin: 17khsA7MvBJAGAPkhrFJdQZPYKgxAeXkBY
http://www.dailypaul.com/303151/bitcoin-has-gone-on-an-insan...

There

will be no "next" Bitcoin, at least not unless something improves on Bitcoin in some super significant way (not likely).

The reason Litecoin has gained traction is because it was first to improve upon Bitcoin in a novel way, by changing the hashing algorithm to Scrypt (allowing better mining distribution), and a faster block creation time. These are not really huge improvements, but the fact that litecoin was first to offer fairly significant differences and the fact it's good to have a backup blockchain besides Bitcoin, makes Litecoin valuable in addition to Bitcoin.

Other alt-coins don't add much of anything else. Most simply repeat what Litecoin or Bitcoin have already done, with slight tweaks. Mincoin being an example. Moving down block creation time to 1 minute is not significant enough to provide large scale market value, it may not even work well (there has to be enough time for block propagation). So all the other 50 plus alt-coins (and growing, I lost count) simply fight with each other for scraps, while none really get huge traction. They usually die after a while, which is why the concept works. If any alt-coin could simply create itself and be successful then there would be no end to the inflation rate of crypto-coins.

Unlikely that any competitor would improve on bitcoin??

It's true that a lot of the competitors, such as Litecoin, are not really significant improvements. The fact that competitors that don't differ in significant ways, but are getting the attention they're getting, isn't a good sign for bitcoin. As you say: If any alt-coin could simply create itself and be successful then there would be no end to the inflation rate of crypto-coins..

But it's rather naive to say that it's unlikely that anything would improve on bitcoin in a significant way. Take Zerocoin for example. Zerocoin started out as an attempt to patch a flaw in bitcoin, namely the privacy issues that result from the blockchain being a public record of every bitcoin transaction ever made. But the zerocoin developers seem to have realized that they're better off making an alt coin that is redesigned from the ground up, rather than something that bolts onto bitcoin:
http://www.reddit.com/r/Bitcoin/comments/1qtevg/zerocoin_red...
Zerocoin will allow for anonymous payments that even hide the transaction amount.

The lack of privacy for bitcoin is why, for example, there was a lot of recent speculation about one particularly large transfer:
http://www.washingtonpost.com/blogs/the-switch/wp/2013/11/23...
and this investigation into Silk Road backers:
http://www.dailydot.com/business/bitcoin-silk-road-investmen...
Every transfer is visible to everyone, and the identities might be hard to figure out but putting the evidence of the transfer out there means that sometimes identities will be uncovered. Here's an article about data mining the blockchain record:
http://cseweb.ucsd.edu/~smeiklejohn/files/login13.pdf
And more here: http://cseweb.ucsd.edu/~smeiklejohn/

Here's example of why the privacy problem is huge for bitcoin:
https://bitcointalk.org/index.php?topic=333882.0
http://www.forbes.com/sites/kashmirhill/2013/11/13/sanitizin...
https://coinvalidation.com/
CoinValidation (with the derogative nickname "TaintCoin") hopes to be "a due diligence service for Bitcoin businesses that they hope will help set regulators’ minds at ease." Basically it's a way to let bitcoins be blacklisted so that exchanges, merchants etc. can keep law enforcement off their backs. Here's the case they make to regulators:
https://coinvalidation.com/PDF_FOR_BITCOIN_REGULATORS.pdf

While Bitcoin is inherently anonymous (as it does not ask for any personal or user­identifiable
information when creating a new address), every transaction on the Bitcoin network is
written to a publicly visible ledger called the blockchain.
 In a well defined and regulated
environment, it is possible for businesses to operate with a greater level of transparency when
receiving bitcoins compared to receiving traditional fiat currency.

[...]

Coin Validation has built innovative software and technology providing Bitcoin businesses with
“know your customer” functionality, and has assembled the information and advanced programs
necessary to satisfy the compliance requirements of the US regulatory agencies. This package
can enable Bitcoin businesses to operate without the legal and cost liabilities typically associated
with Bitcoin, and will also empower the US government to create a safe, regulated,
operating environment for Bitcoin companies in the United States of America.

Those are probably not words that most bitcoin advocates like to hear, but it won't take too many companies having their assets frozen or seized to get big retailers to comply with something like this, if that's what it takes to allow them to accept bitcoin and avoid harassment from law enforcement. And this is only possible because of a flaw in the bitcoin design, namely that every transaction is recorded in a globally-visible public record.

This is exactly the flaw that zerocoin proposes to address. If it's not successful, another will be, and bitcoin has plenty of other flaws that clever algorithm designers are no doubt thinking right now about how to address.

You're

right, the zero coin as an alt could be a big improvement, but there are two things to remember. First, the technology has to actually work, not in theory but also in practice. I haven't seen whether zero coin works in practice, as the idea for it isn't exactly new. Second, any significant technology that does work in practice can be implemented by the already successful coin. That's not always a given, though, because you have to convince enough of the users to the change. So there is certainly room in that regard for a successful zero coin. We just have to see how things play out. That's the nice thing about these things though, is everything is transparent, unlike banks/fiat, for the free market to decide what it wants.

You're underestimating the difficulty of changing bitcoin

On the one hand it's just software and if miners representing 51% of the hashrate agree on it, they can change absolutely anything, and for minor changes the transition can be pretty painless. On the other hand, major changes may require a "hard fork."

The problem -- and bitcoin advocates can correct me if I'm wrong here -- is that nothing those miners can do would let them *replace* bitcoin 1.0 with their new scheme. A hard fork means there are now two alt coins claiming to be bitcoin, one that is the original, and one that is "new and improved." And all the client software and exchange software and merchant software out there will still be using bitcoin 1.0.

Here's one article describing a proposed "hard fork":
http://www.coindesk.com/bitcoin-activists-suggest-hard-fork-...

“We do not lobby for making our proposals part of the current Bitcoin system, but will do a hard fork,’ says Gonzales. “Whoever wants to stay in the old system, can. Whoever wants to switch can as well. And we think this can be done without the problem of a hard asset reset which limits competition to Bitcoin (as in, starting from scratch in mining, market, etc.).”

I'm not

underestimating the difficulty in changing. If you read my post that's what I said, that it's not a given because you have to convince enough users to change. You are correct. Miners by themselves can't force a change. To change Bitcoin everyone (basically a super majority), users, miners, and merchants, have to accept the change, otherwise you get a fork.

I see what you mean

To change Bitcoin everyone (basically a super majority), users, miners, and merchants, have to accept the change, otherwise you get a fork.

It's not "otherwise you get a fork." You do get a fork in that case, even if you get a super majority to switch over. You really just end up with two coins that are both claiming the name "bitcoin," and you're hoping that enough will switch over that the new one is enough more popular to make the old one more or less irrelevant. But miners that spent money on special hardware that isn't going to be usable with the new coins are going to be highly motivated to keep the old fork alive as its own alt coin, and users will have coins in both the old and new forks so nothing stops them from using both, right? So practically speaking getting a super majority to stop using the old fork is going to be very difficult. If the miners with the sole-purpose hardware represent a majority of the hashrate then getting the hard fork to happen at all is going to be a tough sell.

Furthermore, if there's a compelling new technology implemented in a new altcoin built from the ground up, and it is sufficiently superior to merit a hard fork to try to duplicate that in bitcoin, then before you could coordinate the miners into agreeing to the hard fork and put out new client software and merchant software and exchange software to support the new fork, and publicize the change so that everyone will know to get the new software and start using the new fork, and stop using the old fork, you'll have people moving their money to the new altcoin that's completely independent.

And once that starts it's going to accelerate. Digital currencies aren't reliable stores of value because the exchange rate depends solely on market share, and market share is fickle. If there's any sign that a currency is going to lose market share you'd better get out ahead of the crowd or you'll lose big. Announcing that a hard fork is going to occur on such and such a date in order to adopt the desirable technology currently found in zerocoin (or whatever) seems like a good way to guarantee an accelerating stampede out of bitcoin prior to the switchover date.

Furthermore, it's a big leap to assume that future digital currencies will use the blockchain architecture at all. The global ledger is a clever idea, but there's no reason to think that it's the only possible architecture. And if some future idea is fundamentally different on that point and offers significant advantages as a result, then it's the sort of change that bitcoin simply wouldn't be able to adopt.

Basically a hard fork for the kind of enhancement we're talking about (as opposed to an emergency fix to blockchain corruption or something needed just to keep bitcoin working at all) doesn't seem likely to be feasible in practice.

Thanks

for the clear headed logical answer.

Ron brought the Liberty movement together, Rand is expanding the crap out of it! :)