Monday, December 5, 2022

What Are ‘Altcoins’? Are They Better Than Bitcoin?

What Are ‘Altcoins’? Are They Better Than Bitcoin?

Altcoins are cryptocurrencies and other digital tokens built using cryptographic technology similar to Bitcoin’s. Given Bitcoin’s far larger market cap and status as the world’s first cryptocurrency, those that came after are commonly called “alternative coins,” or “altcoins” for short.

Altcoins can have different purposes. Some have the same use case as Bitcoin, but with some supposed refinements and improvements (e.g.: Litecoin, Dogecoin). Others sought to expand the currency’s functionality beyond just money (e.g.: Namecoin). Others implemented more privacy features (e.g.: DASH, Monero, Zcash).

Later, developers built networks for a much greater array of functions (e.g.: Ethereum, Storj) with built-in tokens to fuel their continued operation (e.g.: Ethereum’s Ether, MaidSafe’s Safecoin).

Others were simply direct copies of Bitcoin, designed only to bring their producers quick profits if their value suddenly grew. Some are outright scams, and may not even “exist” on a legitimate platform at all.

These days, many projects use their native tokens as a means to raise capital — buying the tokens is similar to buying a stake in a startup’s future value. Be aware that this market (for now) is completely unregulated, with no guarantees or protections for investors.

Now that you know what altcoins are, you may have even more questions, such as:

What is Bitcoin? A beginners’ guide to digital currency

How do I get some bitcoin?

Where can I use bitcoin?

What is the difference between bitcoin and blockchain?

How is bitcoin different from credit and debit cards?

What are bitcoin public and private addresses?

What is a bitcoin wallet?

Which mobile bitcoin wallet should I choose?

How do I keep my bitcoins safe and secure?

Who is Satoshi Nakamoto? Did he invent Bitcoin?

Is Bitcoin legal? Can I use Bitcoin in my country?

How anonymous or private is Bitcoin?

Is bitcoin secure? What are the risks of using Bitcoin?

Can I make money mining bitcoins?

Should I Invest in Altcoins?

How can I avoid Bitcoin and cryptocurrency scams?

Image via BTC Keychain on Flickr

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