Cryptocurrencies worth investor interest in 2018

Mainstream investors spent much of 2017 trying to figure out how to jump in on bitcoin, the digital currency that’s seen its price balloon to as high as $19,000 in recent months. But even as many hope to make a quick buck by trading on the cryptocurrency’s shifting value, many experts in the field have been exploring other alternatives that could hold just as much promise.

As we head into the new year, here are a few crypto-assets that analysts say are worth watching. But remember: As exciting and rewarding as it may be to think about investing, the risks here are equally great. You might want to think twice about getting involved — unless you’re willing to accept losing it all.

Bitcoin Cash

You can think of bitcoin cash as bitcoin’s faster and younger sibling. Functionally speaking, it works in much the same way: It’s simply a form of digital cash you can use to buy real-world goods and services, such as a cup of coffee. But it was invented only last year after a number of developers working on regular bitcoin, or “bitcoin core” as some call it, decided they were unhappy with the direction of the main project.

At issue was how quickly and cheaply bitcoin could process transactions. Bitcoin’s rising popularity had strained the platform’s capacity — which meant that over time, if you wanted to buy or sell something on the network, you had to pay ever higher fees to have your transaction cleared. Bitcoin made certain changes in its code to bring down those fees and speed things up, but the people who wound up creating bitcoin cash wanted to go much further. That’s how bitcoin cash was born.

ZCash

One of bitcoin’s original benefits was the promise of anonymity. After all, every wallet or account associated with bitcoin is identified simply by a jumble of letters and numbers, not a person’s real name. But soon, law enforcement and academics began demonstrating that, simply by analyzing a particular bitcoin wallet’s public transaction history, you could deduce with relative accuracy who the owner could be.

“The anonymity it offers is kind of brittle, is the way I’ve described it,” said Jim Harper, executive vice president of the Competitive Enterprise Institute, a Washington think tank.

ZCash has tried to solve that by encrypting not only the wallet information, as bitcoin does, but also by encrypting information about individual transactions as well.

Monero

Monero is a bit like ZCash, but takes the additional step of mixing together the online addresses of senders and recipients with other possible senders and recipients. In theory, this makes it harder for the true sender or recipient of money in any transaction to be identified; from the outside, you’d know that one of a number of people listed in the transaction were involved, but you wouldn’t necessarily be able to tell which one.

Monero has made headlines as a haven for criminal transactions. But it could also gain traction among those who are simply conscious of their privacy.

Ethereum

It’s hard to predict how ethereum will be used, but analysts say it could be beneficial for a wider range of applications than bitcoin. Where bitcoin could wrest the power to clear transactions from banks and governments, ethereum could do so for apps and online services.