3 Alternatives to Ethereum for Blockchain Cryptocurrency Beginners
Disclaimer: To start off, this is not financial advice. The author is not a financial advisor. This article contains views and opinions of the author tied to Blockchain Cryptocurrency technology, while also considering some economic ramifications. Cryptocurrency is very volatile and high risk, and without the right knowledge, you can quickly lose everything you ever made. This article may contain affiliate links where the author can potentially earn commission if or when you sign up.
It would be a huge surprise if you’re reading this article and haven’t at least bought and held or sold Ethereum on a platform like Coinbase. Ethereum is huge, and there are very few experts who believe Ethereum is going to slow down, especially with the release of ETH 2.0, hot NFT art, and new applications being built upon Ethereum daily.
In fact some experts believe Ethereum will surpass Bitcoin in terms of Market Cap (the total supply of an asset multiplied by the current value per unit of the asset) at some point in the future. But let’s not speculate on that. Let’s look at Ethereum for what it is to understand why beginners can benefit by looking into other blockchain cryptocurrency alternatives.
It’s clear why Ethereum has a Market Cap of almost $500 BILLION (as of 10/23/2021). Not only was it one of the first movers after Bitcoin, but there is simply so much being built on top of Ethereum. You can spend Bitcoin where Bitcoin is accepted sure. But with Ethereum, hundreds of new apps are being built on top of the Ethereum blockchain where you have to spend $ETH in order to use them.
Let’s not turn this into a $BTC vs $ETH conversation though. But simply put, $BTC is essentially a currency that functions within the physical world. You buy or mine $BTC, and if someone is willing to accept BTC for some physical good or service, you can then trade it.
Meanwhile, with $ETH technically you could spend it like $BTC but there is also an entire metaverse being built. Don’t let the fancy futuristic term metaverse scare you off. Just think of it as the interaction between real world and the experience of digital spaces which is often tied by cash and other human communication.
Art is traded in $ETH. New technologies are being developed to help make $ETH even more effective. Applications are being created to help make it easy to swap from $ETH to another cryptocurrency or token. And there are so many more applications of blockchain technology, which will mostly be based around some form of main chain such as Ethereum Blockchain. And for those applications to function, they require users to facilitate those transactions.
There are some great online courses that teach you how to develop blockchain technologies if you want to dive into that pool, but we won’t cover the technology too much more in depth.
If you’ve purchased $ETH before, and now you want to dive even deeper to find some of the biggest trends and opportunities in blockchain today, keep reading.
WHY $ETH IS NOT BEGINNER FRIENDLY
$ETH, like $BTC is becoming so huge it can become very overwhelming for the beginner cryptocurrency enthusiast to become involved in. Anyone trading with less than a few thousand dollars in $BTC probably won’t have the same opportunities to make money as early adopters simply because of it’s value (the author believes $BTC is still undervalued at the current ATH of $67k).
For $ETH, with the volatility of the markets, trying to get involved with NFT’s, new tokens or altcoins, and even interest-yielding $ETH projects are incredibly expensive. Because $ETH is so big, and so many people are using it, there is a lot of pressure on the system for every transaction. And that pressure on the system increases fees. Fees just to do a simple swap from $ETH to another token can range anywhere from $30 to $100+. ETH really is that darn good and Vitalik Buterin (creator of Ethereum) is pretty darn smart.
And beginners who cannot afford these fees will simply be intimidated and be scared away from the generational-wealth-building technology of our generation. This article is here to help empower people economically through information.
So let’s say an example of a standard person who jumps into the cryptocurrency rabbit hole without enough due diligence. Say someone with less than $5k wants to get involved in Cryptocurrency and hears about all the great speculative tokens being built on $ETH. They buy at the top pay $100 in fees just to get started, the price of the token, and then decide the need the money and sell out at the bottom to pay some swapping fees again, and count their losses. This is how most people might get in, and this is why many people leave cryptocurrency, because they lose money on something they haven’t fully understood, and buy when the excitement is highest.
The $ETH ecosystem (by ecosystem, we mean a combination of all the new technologies and innovations built based on Ethereum Blockchain) is great to study for beginners, but for those without a solid financial foundation may get lost in the fees. Ethereum Blockchain is an obviously an entry place for companies to build on and for anyone with tens of thousands or more to start putting their money in expecting a return. But again, it can get very expensive. So here are some options.
So you want to be involved in cryptocurrency, and you want to find the trend that helped the early adopters of $ETH and $BTC become successful? But you can’t afford $ETH fees and you want to find what’s the next?
The first step is to understand what the Ethereum Blockchain is. You already have an idea simply by reading this article, or you might have known some ideas before this article. The simple thing to understand is apps, technology, innovation, games, and more are built on top of Ethereum Blockchain and $ETH is spent to interact with those systems. AKA, the Ethereum Ecosystem.
The simple alternative is to find another major blockchain or coin that you like and believe in, research that coin, and understand it’s ecosystem. The title of the article says 3, but we’ll have a quick list here of more than three. Off the top 100 list of cryptocurrencies, you can find names like Binance $BNB (based on $BSC Binance Smart Chain), Polkadot $DOT, Solana $SOL, Avalanche $AVAX, and many more. With each of these alternatives, what makes them alternatives is simply the idea that they are solid blockchain protocols upon which other technologies can be built.
Essentially they have created a blockchain foundation (easier to understand word than the standard word protocol) from which other applications and things can be built. Solana is the most obvious example right now which went from less than $2 to over $200 in less than a year as of today. Solana provides a protocol which sets how the blockchain and users interact and exchange data (sometimes in the form of money). From the Solana protocol, people can develop things like games, new technology, and even swapping or financing platforms for lending and more.
By now you should see the similarity to Ethereum, and understand at a basic level what can make a cryptocurrency grow. It’s not just about how valuable a certain protocol or blockchain is, but also what can be built, or is being built around/on top of it. And if you do enough research into some of these technologies early, not only are the fees significantly less than $ETH, but the potential returns are even greater, albeit highly volatile and risky.
And also, when you do transactions within these alternative ecosystems, the costs are less because the pressure of the system are slightly less than if you were to spend $ETH.
That said, this article is not intended to suggest anything is going to dethrone Ethereum or anything like that. And no one can truly predict what will happen as Ethereum evolves with changes such as ETH 2.0. But this has been your simple beginners guide to find some alternatives to Ethereum.