Lately the price of BTC has been plummeting. We were sailing smooth around ~$600 for months and months, and then over the last month I've watched the price get lower, and lower, teetering just under $400 today. There are a lot of people freaking out about this, and there is a lot of FUD (fear, uncertainty, and doubt) going around as well. Meanwhile, there's over 200 noteworthy altcoins (alternative cryptographic currencies) such as Litecoin (LTC), Dogecoin (DOGE), and Darkcoin (DRK) emerging from Githhub. I wrote a blog a little while ago about Dogecoin, and what a joke I thought it was. Well, I've stopped laughing, as the 65,000 Dogecoin that I bought to 'mess around with' is now worth 400% what I paid for them. And despite LTC's price theoretically being intrinsically tied to BTC; the price of Litecoin has gone up, while BTC has gone down. In other words, there are people holding these alternative currencies for reasons other than just buying for the sake of reselling them for Bitcoin. That gives them value independent of whether Bitcoin lives or dies. Follow?
Bitcoin has been around for about 5 years now, and over those years the network has become slower, and slower. Since running a Bitcoin node is very resource intensive on a computer, the average Bitcoin holder does not operate a node, but rather uses a light wallet to store their coins. A light wallet does not require the user to download the entire 26GB (and counting, exponentially) blockchain and verify every single transaction before it's useable. Instead, a light wallet relies on other servers full (heavy) bitcoin nodes to operate. While this is very convenient for the user, it has slowed the network down immensely, because when you run a light wallet, you are not contributing to the network.
While I tend to use light wallets for BTC these days (on my personal computers anyway), I do operate a Bitcoin node on a lonely VPS server just to help the network out a bit. However, for altcoins like DOGE and DRK, I have no problem running a full node as my client on my computer. That's because the blockchain of these coins is much smaller, and thus much less resource hungry. Not only that, but I can send DOGE or DRK and have the transaction verified and confirmed within seconds, while it can take up to an hour to confirm a Bitcoin transaction. The network speed and blockchain bloat are just some of the problems that the Bitcoin developers need to fix if Bitcoin is to remain to worlds (shall we call it) reserve-cryptographic-currency.
If slow transaction speeds and blockchain bloat are not bad enough, there is one more little detail that the Bitcoin developers need to, but have been hesitant to address. That is, anonimity. You see, while Bitcoin does give one a great deal of anonymity when compared to say, credit cards, that does not mean that BTC transactions are anonymous at all! Say huh...? Well, every Bitcoin transaction that ever has and ever will occur is forever logged, publicly, on the blockchain. There are ways of 'laundering' your Bitcoin, but it's a real pain in the ass. This is another problem that some of the altcoins are trying to fix, particularly Darkcoin.
But not only is there Darkcoin, there is Anoncoin, Stealthcoin, Blackcoin, whateveryounameitcoin, and new ones coming out everyday. At the moment, it appears that ANC (AnonCoin) is the most valuable (second to DRK) of the ever-emerging and anonymity-promising coins. Third in line, (in my honest opinion) is XST (Stealthcoin). StealthCoin was gaining a lot of traction, and the developers were talking about opening up a decentralized marketplace called OpenBazaar where anyone could sell anything to anyone, anonymously. But then one of the biggest whales and earliest investors (or was it developers?) dumped a ton of XST and bought up his own new coin SSD (Sonic ScrewDriver), and then I heard that it turns out that XST was a direct clone of RZR (RazorCoin) to begin with! What a clusterfuck, right? But wait, it gets worse...
Today, I heard that bitcointalk forum accounts are being SOLD for Bitcoin! That means that a reputable developer could sell his reputation to some scammer who could then promote (OtherRipOff)Coin and so on... I am still trying to sort this one out. If it's not true, than XST may be the best buy on the market right now. If it is true, than... I just don't know. Any thoughts, anyone?
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