Bitcoin – the world’s first cryptocurrency, was launched back in 2009. Since then numerous cryptocurrencies have been launched. Many crypto tokens were launched to compete with Bitcoin, while some proposed a new solution through crypto, and some launched with the purpose of making money.
Since 2019, many crypto tokens have become extremely popular while many have died a slow death. So as of today, how many cryptocurrencies are there? And why are there so many cryptocurrencies?
In this roundup, we are going to have a look at the year-by-year growth of cryptocurrencies since 2019, the types of cryptocurrencies, and more.
How Many Cryptocurrencies Are There In 2023?
As of April 2023, CoinMarketCap reported about 23,646 cryptocurrencies across different categories. All of these cryptocurrencies together hold a total market cap of $1.20 Trillion.
If we talk about the overall market dominance, Bitcoin alone has a dominance of 46.6%, whereas the second most popular cryptocurrency Ethereum has a dominance of 19.0%.
However, among all the 23000+ cryptocurrencies are not active or valuable enough. Instead, it is a roundup number for both active and dead cryptocurrencies.
If we talk about the active crypto tokens only, the number will stand anywhere around 9100 tokens.
Why Are There So Many Different Cryptocurrencies?
There are numerous reasons why we are seeing way too many cryptocurrencies. Some of the key reasons are:
Decentralization
We know by the fact that cryptocurrencies are decentralized. As a result, no government controls cryptocurrencies, nor are they in any position to issue or delist any existing crypto. As a result, anyone wanting to have their crypto can code it, launch it, and use it for their transactions or other activities.
Low Barrier To Entry
There is no barrier when launching one’s cryptocurrencies. For example, since the release of Bitcoin, developers have forked Bitcoin and created a wide range of crypto tokens that follow the same concept of Bitcoin but are meant to improve Bitcoin’s performance.
But even today, any developer can pick up any blockchain network, study its fundamentals, and code their crypto.
There are many freelancing websites where you can hire developers to create a crypto token for your project at a minimal cost.
Scammer’s Way To Make Money
In financial markets, we have a popular term called pump and dump schemes. In traditional markets, a group of people would buy a penny stock or low-value trading asset and then spread positive news to value up the asset.
And when the asset’s value goes up, initial investors exit, and the later investors lose money. In comparison, this is rare in today’s financial markets.
But in crypto, it is common. Occasionally, you will find scam stars launching new crypto tokens that serve no purpose and solve any real-world problem.
Instead, such coins aim to get extremely popular and make money for the crypto token creators and initial investors.
Also, as there are no regulations, such scams are common in the crypto industry, indirectly increasing the number of crypto tokens.
What Are the Top Cryptocurrencies by Market Cap?
Although there are thousands of cryptocurrencies in existence, there are a handful of crypto tokens that hold the biggest market share. These tokens are:
- Bitcoin (BTC)
Bitcoin is the world’s first cryptocurrency launched in 2009 by an anonymous person named Satoshi Nakamoto. It has a market cap of more than $559 billion. Bitcoin was designed to be a decentralized digital currency that didn’t rely on banks. However, in today’s time Bitcoin is more of an investment choice. But it is not as efficient as many other new age cryptocurrencies are.
- Ethereum (ETH)
Ethereum is the second largest crypto token with a market capitalization of $226 billion. It is a decentralized blockchain platform that allows developers to build and deploy decentralized applications or dApps that utilize smart contracts.
- Tether (USDT)
Tether or popularly known as USDT is a stablecoin. It is designed to maintain a stable value relative to the U.S dollar. The value of the coin is pegged to a traditional currency which is the U.S dollar in this case. Each USDT token is backed by one U.S. dollar held in reserve by the Tether company. The current market capitalizaiton of the token is more than $81 billion.
- BNB (BNB)
BNB or Binance Coin is a cryptocurrency created by the popular crypto future trading platform Binance. The coin was launched in 2017 as an ERC-20 token on the Ethereum blockchain. But later it migrated to its own blockchain called the Binance Chain. The current market capitalization of the coin is more than $51 billion.
- USD Coin (USDC)
USDC is another popular stablecoin with a market cap of more than $30 billion. Each USDC token is backed by one U.S. dollar held in reserve by regulated financial institutions. USDC is fully collateralized, which means that for every token issued, there is a corresponding U.S. dollar held in reserve.
- XRP (XRP)
XRP is a popular crypto token used on the Ripple Network. The token was created by Ripple Labs in 2012 and it has a market cap of more than $23 billion. XRP is primarily used for cross border payments and known for cheap transaction fees with a faster processing time.
- Cardano (ADA)
Cardano or ADA is a decentralized blockchain based platform for building and running smart contracts and dAPps. The token was released in 2015 and as of today it has a market cap of more than $14.4 billion. ADA promises to be more energy efficient than Bitcoin because of its proof-of-stake consensus algorithm.
- Dogecoin (DOGE)
Dogecoin popularly known as DOGE is a popular meme coin. It was created in 2013 as an lighthearted alternative to Bitcoin. Doge has the same proof-of-work consensus algorithm similar to Bitcoin. But it has a much faster block time and higher maximum supply. The current market cap of the token is more than $11.10 billion.
- Polygon (MATIC)
Polygon is a layer 2 scaling solution for Ethereum blockchain that aims to address the scalability and usability issues faced by Ehtereum blockchain. Also, it promises to offer a more scalable, user-friendly solution to blockchain applications. As of today, the token has a market cap of more than $9.16 billion.
- Solana (SOL)
Solana is a high-performance blockchain platform launched in 2017. The platform is known for offering fast and low-cost transactions. Also, it maintains the security and decentralization of a blockchain network at the same time. It uses a new yet unique algorithm known as Proof-of-history. The current market cap of the token is more than $8.51 billion.
What Are the Top Stablecoins?
Stablecoin is a special type of cryptocurrency whose price is attached to another stable asset in the real world. As a result, stablecoin’s prices don’t fluctuate as much as normal cryptocurrency prices do. Their value is mostly pegged to assets like fiat currencies (USD, EUR) or commodities like gold.
As per Coinmarketcap, there are about 140 stablecoins out there. Some of the top stablecoins in terms of market cap are:
- Tether (USDT)
USDT’s value is pegged to the US Dollar at a 1.1 ratio and it is one of the most widely adopted and used stablecoins. The token was launched and managed by Tether Limited with the aim of making USDT the digital dollar. Each $1.00 USD token is backed by $1.00 USD. The current market capitalization of the token is more than $81 billion.
- USD Coin (USDC)
USDC is the second most valuable stablecoin with a market cap of more than $30 billion. Just like USDT, it also has value pegged to US dollars at a 1.1 ratio. The token is designed to remain stable, and its reserves are held in segregated accounts with U.S-regulated financial institutions. However, the coin isn’t issued by the US government.
- Binance USD (BUSD)
BUSD is a stablecoin launched by Binance (Cryptocurrency exchange). Each BUSD token is backed by each US dollar at 1.1 ration. And the assets are held in reserve by Paxos Trust company. The token was launched in 2019 as a joint venture between Binance and Paxos Trust Company.
- DAI (DAI)
DAI is quite different compared to most other stablecoins. Unlike others, it doesn’t have its value pegged to a fiat currency like the US dollar. Instead, it is a decentralized stablecoin that is backed by collateral held on the Ethereum blockchain.
- TrueUSD (TUSD)
TUSD has its value pegged to the US dollar, and it was launched in 2018 by the company TrustToken. Each TrueUSD token is backed by one US dollar, which is held in an escrow account audited by third-party firms to ensure transparency.
- Pax Dollar (USDP)
Pax dollar – formerly known as PAX or Paxos Standard, is a dollar-backed stablecoin. The token moved its ticker from PAX to USDP, and it represents 1 USDP = 1 USD. The token was launched in 2018 by Paxos Trust Company.
- USDD (USDD)
USDD is one of the recently launched stablecoins that quickly became one of the top stablecoins. USDD stands for decentralized USD. The token is governed by the TRON DAO reserve, and it represents 1 USDD as 1 USD.
- Gemini Dollar (GUSD)
GUSD is a stablecoin launched by the popular crypto derivatives platform Gemini. The token was launched in 2018. Each Gemini USD token is backed by one US dollar held in a State Street Bank and Trust Company Account that is regularly audited by an independent accounting firm.
- TerraClassicUSD (USTC)
USTC is a decentralized and algorithmic stablecoin of the Terra Blockchain. It also has its value pegged at a 1.1 ratio to the US dollar through the minting/burning mechanism of LUNC tokens.
- Frax (FRAX)
Frax is a decentralized algorithmic stablecoin that is designed to maintain a stable value of $1 USD. It is pretty similar to other stablecoins like USDT or USDC. But unlike them, Frax’s value is not pegged to a specific fiat currency. But it uses a combination of collateral and on-chain algorithms to maintain s price stability.
What are the top Altcoins?
Altcoins, or you can say alternative coins are every other cryptocurrency that is not Bitcoin or marks itself as a stablecoin. A few people also consider altcoins to be any other coin except BTC and ETH.
Because most crypto tokens in today’s time are forked from one of the two tokens or tried to replace Bitcoin or Ethereum by offering an alternative.
So if we talk about the overall number of Altcoins, it would be the total crypto tokens listed on Coinmarketcap minus BTC and ETH.
Anyway, here are some of the top Altcoins:
- Polkadot (DOT)
Polkadot is a new-generation blockchain protocol that connects blockchains. With Polkadot, data can be exchanged between two incompatible blockchain networks like Bitcoin or Ethereum. The blockchain network is also designed to be fast and scalable.
- Litecoin (LTC)
Litecoin is one of the popular alternatives to Bitcoin, launched in 2011. It is a peer-to-peer cryptocurrency that allows fast, secure, and low-cost transactions. The main difference between LTC and BTC is the underlying algorithm to mine the tokens. LTC uses a scrypt algorithm which makes it super easy for miners to mine the coin.
- Shiba Inu (SHIB)
Shiba Inu is an Ethereum based altcoin. It is popularly referred to as a meme coin, and it was launched in 2020. The coin is considered an alternative to Dogecoin. However, in terms of practical use of the token – it doesn’t really solve any real-world volume except having a larger supply than Bitcoin and Ethereum.
- TRON (TRX)
Tron is a decentralized crypto token launched in 2017. It is designed to be a decentralized platform for entertainment, content sharing, and gaming. Trx is used as a way to pay for the transactions on the Tron network and access different services and applications built on top of the platform.
- Avalanche (AVAX)
Avalanche is an alternative to Ethereum. As it also uses smart contracts to support a wide range of blockchain projects. The avalanche blockchain can offer near-instant transactional finality, and its coin AVAX can be used for paying transaction processing fees and more.
- Wrapped Bitcoin (WBTC)
WBTC is a unique type of cryptocurrency that is pegged to the value of Bitcoin. It is an ERC-20 token that was created by wrapping Bitcoin into the Ethereum blockchain. As a result, Bitcoin holders can access the benefits of the Ethereum ecosystems and its byproducts like decentralized finance or DeFi.
- Chainlink (Link)
Chainlink is a popular decentralized oracle network that connects smart contracts on the blockchain platform with real-world data. It acts as a bridge between on-chain and off-chain data. And its use cases can be seen in the space of decentralized finance.
- Cosmos (ATOM)
Cosmos is a decentralized network of independent blockchain ecosystems that can communicate and transact with each other through a shared communication protocol. The solution was created to solve the issue related to blockchain interoperability.
- UNUS SED LEO (LEO)
LEO is a cryptocurrency created by Bitfinex – A popular cryptocurrency exchange. The token was launched in 2019, and its benefits are associated with the exchange. LEO holders can use the token to pay for their trading fees on Bitfinex and receive a discount in return. LEO is also a governance token. Meaning the token holders will have the right to vote on proposals related to the Bitfinex platform.
- Uniswap (UNI)
Uniswap is a DEX or Decentralized Exchange built on the Ethereum blockchain. The exchange operates through a series of smart contracts responsible for executing trades, removing the need for a centralized order book or any intermediary. The exchange has its own native cryptocurrency called UNI, which is used for governance purposes.
Difference Between Cryptocurrencies, Altcoins and Stablecoins
The bottom characteristics of Cryptocurrencies, Altcoins, and stablecoins are the same – these are digital assets.
However, it is their individual characteristics and use cases that make the main difference.
Also, cryptocurrencies and altcoins are the same things in terms of their functionalities. As altcoins are nothing but coins that are not BTC, ETH, or any stablecoins.
Volatility
The first main difference between cryptocurrencies and stablecoins is the volatility. As you already know, cryptocurrencies or altcoins’ value is not pegged to a fiat currency, and they are highly volatile in nature.
The price of the crypto tokens depends on the market conditions, and the prices can easily go up or down within a short period of time.
But Stablecoin’s prices don’t really fluctuate much, as their value is tied to an actual asset. The only way a stablecoin loses or gains its value is if the pegged collateral sees any price fluctuations.
Use Cases
Another key difference is that Cryptocurrencies, especially altcoins, have a faster transaction time or can deal with smart contracts. In contrast, stablecoins are mostly used as a payment token or the base currency for trading cryptocurrencies and derivatives.
Investment
Cryptocurrencies are widely used as a way to invest, whereas stablecoins don’t really offer any significant investment gains. As cryptocurrency’s prices depend on the market conditions. The constant buying/selling of an asset decides the price move of the coin, which is ideal for both crypto investment and trading purposes.
Governance
There are many crypto tokens that are meant for governance. Meaning these tokens gives you the voting power to decide the future direction of a project. But stablecoins do not really offer you any such authority.
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Cryptocurrency Growth Over Time
Since early 2013, we have seen thousands of cryptocurrencies being launched. If we talk about the increase in the quantity of cryptocurrencies since 2013, here is how the data stands:
| Year | Increase In Number Of Cryptocurrencies |
|---|---|
| 2013 | 7 |
| 2014 | 67 |
| 2015 | 501 |
| 2016 | 572 |
| 2017 | 636 |
| 2018 | 1359 |
| 2019 | 2086 |
| 2020 | 2403 |
| 2021 | 4154 |
| 2022 | 8714 |
| 2023 | 8856 |
Why Do So Many Cryptocurrencies Fail?
According to data by Statista, only the top 20 cryptocurrencies make up nearly 90% of the total market. So why do so many cryptocurrencies fail? Here are a few key reasons:
Lack of Adoption
Lack of adoption has to be one of the main reasons why cryptocurrencies fail to sustain. There can be multiple reasons why it happens. For instance, the crypto project might not be the ideal solution to a problem; it is facing tough competition against its competitors, lacks usability, or has poor technology and lacks innovative features.
Lack of Funding
To sustain a crypto project, a lot of funding or investment is needed. Hence many projects mails to acquire funding in time to continue with their development and maintenance process. Projects that fail to acquire funding, developers fail to reach their development goals, and the project dies a slow death.
Market Saturation
The crypto market is highly saturated. Multiple crypto projects are trying to solve a single problem. As a result, many crypto projects fail to acquire funding, and gain a user base, and it becomes extremely tough for new crypto projects to stand out.
Security Issues
Security issues are another reason why many cryptocurrencies fail to sustain. There have been numerous projects that faced security breaches and hacks. As a result, it undermined user trust and confidence and failed to gain a widespread user base.
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Conclusion
That was a roundup of how many cryptocurrencies there are. Overall, there are numerous cryptocurrencies that exist on the internet, but only a few of them hold the most significant market share and solve real-world problems.
Also, there are newer crypto tokens being launched every once in a while. And it is expected that the number of cryptocurrencies will only grow at a massive scale in the coming years.
