Heard the term ‘Altcoins’ and want to know what they are? Read on…
In very layman’s terms, Altcoins are “Alternative Coins” – they are alternatives to Bitcoin, the most common cryptocurrency.
In fact, most altcoins are derived direct from Bitcoin. They take their codebase from the core Bitcoin codebase (which is open source), and then adapt it or adding additional features to it. Typically this is done for the purposes of achieving faster transactions, micro-transactions, increased anonymity for example.
Altcoins are ultimately the alternative cryptocurrencies which have been launched into the cryptocurrency market, following the initial success of Bitcoin. Most commonly, altcoins will pitch themselves as ‘better’ or superior substitutes to Bitcoin in someway.
Bitcoin’s incredible success to date as the first peer-to-peer digital currency has paved the way for many alternatives, and indeed many ‘lookalikes’ to follow. Most altcoins are trying to target and then build upon (or around!) perceived limitations of Bitcoin, to try and gain new competitive advantages. A new wave of altcoins also now includes coins which have arisen from ‘ICOs’ (Initial Coin Offerings). ICOs are a new means for companies to raise funds and investment. They make use of the cryptocurrency marketplace and piggyback on the success and media hype it has experienced in recent times.
How many different Altcoins are there?
Altcoins now number in the thousands. However many are of very low value. A large number of altcoins trade for fractions of cents, and are only available through the more obscure, smaller cryptocurrency exchanges. In this way, one might liken certain altcoins to ‘penny-stocks’ versus the larger ‘listed stocks’ on a full blown stock exchange such as the NYSE or NASDAQ.
Regardless of it’s huge number of competitors and cousins, Bitcoin remains the largest and most popular cryptocurrency or digital ‘coin’. By market cap it is the most valuable, and by trading volume it is the most traded. A growing handful of altcoins have gained significant ground in terms of monetary value and notoriety over the last year or two though. A selection of the most notable amongst them are Ethereum, Bitcoin Cash, Litecoin, Dogecoin, and Ripple.
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