The cryptocurrency was at its peak in 2021, no doubt in part due to the incredible profits that some coins have made over the past few years. Many investors who never thought about buying cryptocurrency are now looking closely at the asset class. But while the financial press mainly focuses on the most popular coins, there are literally hundreds of alternatives in the cryptocurrency space.
Find out: Bitcoin Cash (BCH): how is it different from Bitcoin and what is it worth?
Options: Dogecoin (DOGE): what is it, what is it worth and is it worth investing in?
Many of these coins have advantages over names like Ethereum in Bitcoin, especially when it comes to privacy. Although the blockchain technology that coins such as Bitcoin use must be secure and anonymous, some coins manage to keep transactions private. Read on to find out how some of these alternative coins achieve this level of security.
Last update: Jun 10, 2021
Many of the terms in the world of cryptography may seem out of the ordinary to the casual investor. Beam is a great example as it uses the MimbleWimble and LelantusMW protocols that operate in the world of confidential decentralized finance. Beam is primarily focused on security as transactions are private by default and addresses are not stored on the blockchain. Although Beam uses the same unspent transaction output model as Bitcoin, Beam values are encrypted with so-called “blinding factors”, which provides an additional layer of security.
Read More: What Are Altcoins And Is It Worth Risking Potential Rewards?
Grin uses the same MimbleWimble technology as Beam and is also focused on user and transaction privacy. To ensure confidentiality, Grin does not use amounts or addresses. To hide the origin of the transactions, it first goes through a subset of peers and then broadcasts. In other words, all transactions appear to be random to any outsider viewing the data. Grin uses Mimblewimble cryptography to erase data from previous transactions, which, according to its creators, prevents Grin from collapsing under the weight of too much data stored on its chain. In simple terms, the Grin network is compact, easy to download and test, and is completely anonymous by removing certain transaction information.
Learn: Cryptocurrency Basics
Verge Currency (XVG)
The Verge currency was created in 2014 under the name DogeCoinDark. Verge Currency’s goal is to improve the original Bitcoin blockchain. Verge integrates TOR or The Onion Router, which is an IP address obfuscation service to keep transactions secure. According to its creators, Verge is one of the few cryptocurrencies that has support for several algorithms that use the principle of Proof-of-Work mining. For those more technically oriented, Verge has five different hash functions: Scrypt, X17, Lyra2rev2, myr-groestl, and blake2s.
Read: Binance Coin (BNB): Why It’s So Interesting For The Cryptocurrency World
Monero is a private digital currency that allows users to be their own bank. Monero’s security protocols ensure that outsiders cannot see the balance or activity of any particular user. This contrasts with more famous coins like Ethereum or Bitcoin, which have transparent blockchains. According to the creators, Monero is the only cryptocurrency in which, by default, each user is anonymous. The amount of each transaction, in addition to identifying the sender and the recipient, is hidden using three special technologies: ring signatures, RingCT and hidden addresses. Since every transaction is private, Monero cannot be tracked.
To read: What is a chain link and why is it important in the world of cryptocurrency?
Zen is Horizen’s proprietary cryptocurrency that uses Zendoo technology to allow developers and / or companies to create their own public or private blockchains. Zen is an Equihash-based cryptocurrency with proof of work that offers two different types of addresses: Z-addresses and T-addresses. Z-addresses are completely private and anonymous and are known as secure transactions. T-addresses are public and transparent and are used to make bitcoin-like transactions on the blockchain. Users can choose which type of address they prefer if they want to control their privacy.
To find out: Where does cryptocurrency come from?
DASH is a payment cryptocurrency that, as the name suggests, is designed to be transferred almost immediately. DASH is the so-called “fork” of the Bitcoin protocol, except that it provides additional privacy features and has negligible transaction fees. DASH uses a two-tier blockchain network that includes both miners and master nodes. Masternode assignments are features like PrivateSend and InstantSend that provide both untracked and anonymous transactions. DASH, created in 2014, was the first private cryptocurrency.
Check: Ethereum (ETH): what is it, what is it worth and is it worth investing in?
If you’re a fan of Edward Snowden when it comes to privacy, you might want to take a look at ZCash. In 2017, an infamous whistleblower came out in support of ZCash as the “most interesting alternative” to bitcoin. As with some other coins, ZCash offers two types of transactions: secure and transparent. ZCash offers enhanced privacy with “zk-SNARKS”, which stands for “zero knowledge condensed non-interactive arguments of knowledge.” While difficult, what matters to the average user is that ZCash tries to improve the bitcoin chain with heightened security measures and maintains fast block times, low fees, and large block sizes.
To read: 10 best cryptocurrencies to invest in 2021
ByteCoin claims to be “the first private untracked cryptocurrency.” The coin is powered by CryptoNote technology, which creates untraceable payments, unrelated transactions and a scalable blockchain. The ByteCoin blockchain hides all addresses and uses ring signatures to combine different outputs into a single transaction. This increases security by making it nearly impossible to identify the source of the money. Bytecoin also allows users to generate disposable addresses from a single set of keys, making transactions and addresses unrelated.
To find out: Are you investing like these millionaire stars?
Firo, formerly known as ZCoin, uses Dandelion technology to shuffle users’ IP addresses between nodes in an arbitrary number of steps. This helps to protect the user’s anonymity. Lelantus technology allows Firo users to “burn” their coins in an anonymous set of over 65,000, from which recipients redeem the coins. This breaks the link between the owner of the coin and all other previous transactions that were associated with him, ensuring privacy. This is in contrast to coins like Bitcoin, which have public blockchains and previous transaction histories.
Advice: 13 toxic investments to avoid
Super Zero Protocol (SERO)
SERO bills itself as “the world’s first true privacy protection platform for decentralized applications.” SERO is also the world’s first platform to allow the issuance of anonymous digital assets, which means that developers can issue their own privacy coins and use them in DApps. Those more experienced in crypt development will appreciate that SERO has built the world’s first zero knowledge encryption library known as “Super ZK”, which is 20 times faster than the latest zk-SNARKS.
More From GOBankingRates
This article first appeared on GOBankingRates.com: 10 Most Private Cryptocurrencies to Invest in