What are Altcoins
Altcoins is a term used to describe cryptocurrencies other than Bitcoin. Altcoins are Alternatives to Bitcoin and traditional currencies. Altcoins were introduced to improve some aspects of Bitcoin, such as transaction speed or energy efficiency. However, a lot more altcoins have been created to serve different purposes. Although, the first altcoin was launched in 2013, altcoins have become a massive part of the cryptocurrency market. Based on CoinMarketCap data, altcoins made up over 40 percent of the total cryptocurrency market in March 2021.
How Do Altcoins Work?
Altcoins like Bitcoin are digital money that can be used as an exchange of value and can also be transferred from one user to another using a unique private key. These transactions are also recorded on the blockchain.
What are Shitcoins?
Shitcoin is a term used to describe coins introduced after Bitcoin became popular. They refer to cryptocurrencies with little or no value or cryptos without an intended purpose.
Rather than long-term gains, shitcoins exhibit price increases followed by nosedives caused by investors who want to make money quickly.
Types of Altcoin
- Stable coins: Stable coins are altcoins designed as an alternative to Bitcoins volatility. The value of stable coins is tied to security, such as the US Dollar. Tether and Libra by Facebook are examples of stable coins.
- Digital tokens: These, like Bitcoin are cryptocurrencies that you can own, trade, or transferred as an exchange of value. Digital tokens are back by a blockchain platform.
What are the Top 10 Altcoins in 2021?
Ethereum is a blockchain platform with its currency, called Ether (ETH) or Ethereum, and a Solidity programming language. In terms of market value, Ethereum ranks second to Bitcoin as of August 2021.
Bitcoin will only ever mine or produce, bitcoins every 10 minutes, but Litecoin will create coins every 2.5 minutes. As a result, Litecoin can process payments faster. Bitcoin will only produce 21 million bitcoins, while Litecoin will produce 84 million litecoins. Litecoin has a market capitalization of $11.3 billion and 66.75 million coins in circulation, making it the sixth-largest cryptocurrency globally.
In addition to developing decentralized financial products like Ethereum, Cardano offers solutions for chain interoperability, voter fraud, and legal contract tracing. The primary cryptocurrency of Cardano is called ADA. The market cap of Cardano as of September 2021 is 90.739B.
Tether is the most popular stablecoin. Cryptocurrencies pegged against other securities to reduce volatility. With stablecoins, users may not have to worry about price fluctuations. In addition, users may easily make transfers from other cryptocurrencies back to dollars by using Tether, which is tied directly to the price of the U.S.Dollar Tether(USDT). Tether is considered the third-largest cryptocurrency by market capitalization of $65 billion. As of August 2021, there are also currently 65.49B USD Tether in circulation.
Bitcoin Cash (BCH)
Bitcoin Cash is one of the earliest altcoins created from Bitcoin. Bitcash was created as a result of a split from Bitcoin from a debate about the scalability of bitcoin. Block sizes on the Bitcoin network are capped at one megabyte (MB). In BCH, the block size increases from one MB to eight MBs, with the idea that larger blocks can hold more transactions and increase transaction speed.
The changes in BCH also include the removal of the Segregated Witness protocol that impacts block space.
The market capitalization of Bitcoin Cash as of September 2021 is $12 billion, and there is currently 18 million Bitcoin Cash in circulation.
Gavin Wood, another member of the team that created Ethereum, had some differing opinions about the project's future, and he created Polkadot to address these concerns.
Poloniex's protocol allows permissioned and permissionless blockchains, as well as oracles, to work alongside one another. The market capitalization of Polkadot as of September 2021 is $31 billion, with 987 million DOTs in circulation.
Using Stellar's open-sourced code, digital currency can be converted to fiat money domestically and internationally.
XLM is the symbol for the cryptographic token on the Stellar blockchain called the lumen.
Stellar is one of the best-performing altcoins with market capitalization of $8 billion.
Chainlink is a decentralized oracle network that bridges the gap between smart contracts, such as those on Ethereum, and external data. Chainlink’s potential seems limitless and many of the top DeFi apps pay huge amounts for the LINK token to use their platform.
Chainlink makes smart contracts really smart as it incorporates real world date. Chainlink can be used in insurance, to measure and payout insurance claims. The market capitalization of Chainlink in September 2021 is $13 billion, with 449 million LINKS in circulation.
UniSwap is an Ethereum-based Decentralized Applicaton for exchanging Ethereum cryptocurrencies instantly by tapping into its smart contract liquidity pools. As of Sepetember 2021, there are 611 million UNIs in circulation with a market capitalization of $18 billion.
AAVE is a popular lending protocol used today. As part of an Aave contract, borrowers are required to offer additional collateral beyond the borrowed amount. During the loan term, collateral is held in escrow safely by the smart contract, eliminating the need for a trusted middleman. The smart contract automatically pays the lender if the borrower defaults.
Aave offers stablecoin loans at 10% APY with no know-your-customer (KYC) necessary, which is unheard of in traditional finance.
DISLAIMER: This blog is not an investment or financial advice website. Talk to your financial advisor before you make any investment decisions.
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