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Feb 18, 2020

Bitcoin, Ethereum and ILCoin: A Year’s Analysis

ILCOIN Development team

With the sudden explosion of blockchain capabilities, every crypto developer is looking to create the next Bitcoin. Although we have seen some explosive earnings over its history, maybe Bitcoin is not a good point of comparison. This article compares the past year for three coins commonly sold on the market and aims to see which is the best investment for the coming year.

Starting, of course, with Bitcoin, we understand that from a historical point of view, it was the original technology that led the way for all future cryptocurrencies. Back then, some measured it as a fun little financial experiment that could have been put together in some tech or financial college but had no real value outside of a school project. Others saw it as the necessary next step to get ordinary people back up to the same level as major corporate CEOs and CFOs who were quickly taking up all of the economic equity of larger nations like the U.S.

Whatever side you took back then, the growth was slow, and other than some people using it in black market trade, it didn’t really take off. After it hit the mainstream and became a feasible currency exchange just like any other FX, it blew up over the course of a few months with one coin selling at anywhere between $3,500 and $20,000 in late 2017. It was a goldmine for those who were involved in it, but this is here and we are living in 2019. So, let’s take a critical look at what the markets are like today.

From an investment stand point, the start of the past year produced underwhelming returns and suddenly shot up around March without stopping till June. Most of the people involved would call attention and point to this as the big money maker. But why? Since when has volatility in the markets become a sign of success? To an experienced investor, this kind of violent shifting is just a sign of fickle buying practices; people trading on a whim just to make a quick buck. This kind of unstable back and forth is a sign that the value is only in people’s heads, and there is no real future beyond this point; just speculation.

Ultimately, Ethereum was a reaction to Bitcoin; the first real attempt at matching the currency with everyday functionality. It is easy to see why Ethereum would be seen as the best alternative to Bitcoin. They brought us the world of smart contracts and pioneered the technology of DApps (decentralized applications). They have a sturdy foundation for the user and specific blockchains that allow for people to own segments of chains for their own personal usage.

Ethereum is not immune to the ebbs and flows of the markets, though. Similarly to Bitcoin, this year it has seen a spike in investment and a slow decline since June. Don’t get me wrong, it is far from its lowest point this year ($104.30 in early February), but it is still far from a stable upwards yield. However, that’s not the main argument against Ethereum either. For anyone who is already involved in Ethereum, you would know that it has adopted the token-based standard for their blockchain networks. What does this mean? Imagine you want to buy stock in Apple Inc., but the only shares issued by the company are called ‘Apple bucks’. The tokens themselves only have value within the trading community of that particular investor circle. Now, Ethereum works in a similar but more dynamic way with user tokens. That is the same as these metaphorical ‘Apple bucks’ and worker tokens which are basically tokens for the people issuing the shares. Anyone can open their own subsection of the blockchain on the Ethereum network and issue tokens from what is called a “token factory”.

This muddies the water a whole lot and creates a situation in which anyone can create and distribute a currency. What is the value in that? Some would argue that the value is only in what people are willing to pay for it. After all, what is the value in anything, right? That may sound like fair logic, but it doesn’t hold up in terms of finance. It is the same argument as to why governments don’t simply create new money in an economic downturn. This is essentially crypto inflation, and it is a self-destructive concept in terms of currency exchange.

The final case we will discuss is for our ILCoin; a cryptocurrency that scripted its initial source code in 2014 and mined its first block in January of 2015. Since then, developmental growth and testing has been continuously ongoing. Our team has been able to adapt and overcome challenges that seemed to be insurmountable such as FIFO (first-in-first-out), block size scalability and immunity to 51% attacks.

After our initial heavy developmental period, good marketing and strong investor interest led to a stable market for our coin. Investors understand the current growth of the coin and see its potential. People are staying with ILCoin because they know that the best is yet to come. At the end of last year, 2019, we launched our innovative 5 GB block technology that will revolutionize the blockchain industry. Investors understand this and are holding on to their coins as they know the best is yet to come.

That is the ultimate difference between these three currencies this year: one has had its day and has fallen into speculative trading trends without ongoing developments, another is at risk of becoming an inflation nightmare, and one is gearing up to change the industry as we know it. In this world of technological and financial jargon, choices need to be made and the only mistake you can make is not really understanding what your choices are. Now you know.

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