Newcomers to the cryptocurrency circle often find themselves confused by the various concepts of different cryptocurrencies. This article will clarify the concepts and differences of competitive coins, shitcoins, meme coins, air coins, Dogecoin, and Shiba Inu coin.
Table of Contents
1. Competitive Coins (Altcoins)
2. Shitcoins
3. Meme Coins
4. Dogecoin
5. Shiba Inu Coin
6. Air Coins
For newcomers to the cryptocurrency circle, they may feel overwhelmed by the concepts of competitive coins, shitcoins, meme coins, and air coins, among others. This article will clarify the concepts, features, and differences of these different types of cryptocurrencies.
1. Competitive Coins (Altcoins)
Competitive coins, also known as altcoins, refer to all cryptocurrencies other than Bitcoin. They are considered alternatives to Bitcoin. The emergence of altcoins is mainly to improve certain characteristics of Bitcoin or provide functions that Bitcoin does not have. They may differ from Bitcoin in the following aspects:
Consensus Mechanism:
Many altcoins use different consensus mechanisms from Bitcoin. For example, Ethereum introduced the Proof of Stake (PoS) mechanism in the later stage, and EOS Chain adopted the Delegated Proof of Stake (DPoS) mechanism.
Transaction Speed and Fees:
Some altcoins focus on improving transaction speed and reducing transaction costs to be more suitable for everyday transactions and small payments.
Smart Contracts and Decentralized Applications:
Ethereum is one of the most famous altcoins. It introduced smart contract functionality, which allows developers to create decentralized applications (DApps) on its blockchain.
Specific Use Cases or Community Oriented:
Some altcoins are designed for specific community or industry needs, such as focusing on supporting decentralized finance services (DeFi) or community governance.
Supply Limit and Issuance Method:
Unlike Bitcoin’s fixed supply limit of 21 million coins, some altcoins have different supply limit policies or adopt different issuance and reward mechanisms.
The diversity and innovation of altcoins bring rich choices and possibilities to the cryptocurrency market, but also come with varying degrees of risks and challenges. When considering investing in altcoins, investors need to have a deep understanding and evaluation of the technology, team, market position, and potential risks behind them.
2. Shitcoins
Shitcoins are another term used in the cryptocurrency community. Initially, like altcoins, they were used to refer to all cryptocurrencies other than Bitcoin. However, later on, the term was more commonly used to describe cryptocurrencies that are considered to lack substance, purpose, or value. They may have the following characteristics:
Lack of Innovation or Uniqueness:
Many shitcoins are merely slight variations of existing cryptocurrencies without providing any significant innovation or unique features.
Driven by Hype:
The prices of these coins are often influenced by market hype and speculative behavior rather than their technical advantages or potential applications.
Lack of Long-term Plans and Support:
The developers of shitcoins may lack long-term support plans or continuous technical development strategies.
Market Manipulation Risks:
These cryptocurrencies are susceptible to market manipulation.
Lack of Transparency:
The development teams may lack transparency, clear communication, and public development processes.
High-risk Investments:
Due to the above factors, investing in shitcoins is generally considered high-risk and can lead to significant financial losses.
Although this term is sometimes used to belittle or criticize certain cryptocurrencies, these coins may actually have some potential or community support. Therefore, conducting in-depth research and cautious risk assessment are important when evaluating any cryptocurrency.
3. Meme Coins
Meme coins are a type of cryptocurrency created based on internet memes or popular cultural elements. These cryptocurrencies often have characteristics of humor, irony, or entertainment, and their value and popularity are closely related to social media activities and internet trends. Here are some key features of meme coins:
Community-driven:
Meme coins often have active online communities, and community members actively promote these coins through social media and online forums.
High Price Volatility:
Due to the strong influence of community sentiment and internet trends, meme coins often have highly volatile market performance.
Lack of Clear Practical Applications:
Many meme coins do not have clear functions or application purposes at the time of creation. They are more products of fun and internet culture.
Internet Hype and Media Attention:
The popularity and value of meme coins are often closely related to internet hype and media attention and are sometimes driven by celebrities or influencers.
Market Risks:
Due to their heavy reliance on internet trends and community sentiment, investing in meme coins is usually high-risk.
One of the most famous meme coins is Dogecoin (DOGE), which was initially created as a humorous parody of Bitcoin, using an internet meme of a Shiba Inu dog as its logo. However, over time, Dogecoin has gained a large following and community support. Tesla CEO Elon Musk has openly supported Dogecoin, and later on, DOGE began to be accepted by some merchants as a means of payment. Meme coins are unique in that they showcase an interesting aspect of cryptocurrency culture while highlighting the volatility and non-traditional nature of the crypto market.
4. Dogecoin
Dogecoin is considered the founder of meme coins. Initially, people bought it just for fun. As more people bought it, a community was formed, resulting in collective resonance (recognition).
5. Shiba Inu Coin
In the understanding of the cryptocurrency community, when the price of a meme coin, such as a Shiba Inu coin, skyrockets by tens, hundreds, or even thousands of times, it transforms into a highly sought-after coin within the community and is called a “golden dog.” Apart from Dogecoin, other examples of golden dog coins include PEPE coin and Shiba Inu coin, which claims to be the killer of Dogecoin. They all belong to meme coins but have gained significant community support and become highly valued within the community.
6. Air Coins
Air coins are usually used to describe cryptocurrencies that are considered to have no real value, support, or application or are associated with scams. These cryptocurrencies are often seen as castles in the air, existing only in name and promotion, but lacking a solid foundation or reasonable investment rationale. Here are some characteristics of air coins:
Lack of Substantial Support:
Air coins usually lack strong business models, technological innovations, or practical applications to support them.
Market Speculation:
The value of these coins mostly relies on market speculation and false advertising, rather than their intrinsic value or potential applications.
High Risk and Speculative Nature:
Investing in air coins carries extremely high risks because their prices are easily manipulated and highly volatile.
Lack of Transparency and Reliability:
The development teams and operational processes of these coins often lack transparency and may even involve fraudulent activities.
Possibility of Rapid Disappearance:
Due to the lack of a solid foundation, these coins may quickly disappear, especially after market hype subsides.
In general, air coins are a negative term used to describe cryptocurrencies that may seem attractive but lack lasting value. It is crucial to conduct thorough market research and risk assessment before considering investing in any cryptocurrency to avoid financial harm.
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