Cryptocurrencies are becoming a significant part of the global economy, but it can take a lot of work to keep track of all the different coins. In this article, we’ll look at what an altcoin is and how they differ from Bitcoin, which remains the most well-known cryptocurrency.
Altcoin is an established term in cryptocurrency and a shorthand for alternative coin
If you’ve been looking into cryptocurrency, you may have heard the term altcoin before. Altcoin is a term used to refer to any cryptocurrency that isn’t Bitcoin. It’s short for alternative coin and was coined in 2011 by user “SmokeTooMuch” on the Bitcointalk forum.
Thousands of altcoins are on the market, yet close to 99% are or will quickly become worthless. Carefully evaluate your options before making financial commitments. Altcoins can quickly destroy a carefully built-up portfolio.
Altcoin isn’t Bitcoin, and vice versa
Altcoin is used to refer to any cryptocurrency that is not Bitcoin. So, an altcoin is a shorthand for an alternative coin. Many altcoins are out there, and more are being created daily.
Altcoin refers to any cryptocurrency that is not Bitcoin specifically. However, it can also be used in other contexts where you don’t want your listener or reader to think of just Bitcoin or Ethereum.
Altcoins can have their own blockchains, or share them with other cryptocurrencies, depending on the coin
The blockchain is a decentralized, distributed database. That’s what makes it so unique. No one person or organization owns or controls it; there’s no single point of failure. If any one machine was shut down, the entire network would keep humming along just fine.
But how does this work? How can you store data on computers that are spread across the globe? The answer lies in cryptography and public key infrastructure (PKI).
Blockchain uses digital signatures to verify transactions. These signatures are created using public-private key pairs (also known as “wallet addresses”) that don’t require names or other identifying information. It allows users complete anonymity while still allowing them some control over their assets by having access through their private key. That key is a password for accessing funds residing in a crypto wallet.
Bitcoin remains dominant, but many other cryptocurrencies are out there, and more are being created daily
Bitcoin remains the most well-known cryptocurrency and has, by far, the largest market cap. It is also the most used cryptocurrency and will maintain that lead for decades. Its network moves the most value of all cryptocurrencies, confirming altcoins have little momentum in the payment space.
Some people claim there will be an altcoin that can overtake Bitcoin. So far, thousands of such claims have been made and proven wrong. Bitcoin has a first-mover advantage no alternative coin can ever achieve. It is also the most secure and reliable blockchain of them all.
Altcoins are a big part of the cryptocurrency market. While Bitcoin may be the most well-known, it’s only one of many currencies.
Altcoins have helped expand the scope of digital currency and make it more accessible for everyday users worldwide. Even so, caution remains necessary when investing in any altcoin.
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