What are Altcoins?
Altcoins are also known as “Alternative Bitcoins”, a common name for cryptocurrencies (Cryptocurrency) other than Bitcoin. Most Altcoins are improved versions of Bitcoin. After the success of Bitcoin in 2009, Altcoins also appeared from there.
Atlcoin is an alternative to Bitcoin because it has improved and solved the weaknesses in the protocol of the digital currency Bitcoin. This is a digital currency created to replace Bitcoin. It is also because of the success of Bitcoin peer-to-peer network that there is today’s Altcoin.
The word “Altcoin” is a combination of the two words “Alt” and “coin” in which Alt means replacement and coin is coin, or Altcoin means replacement coin and covers all types of Cryptocurrencies currently available. on the market.
Why did Altcoins appear?
As mentioned above, Altcoin is an alternative to Bitcoin, it was born to improve the disadvantages of Bitcoin. In addition, there are quite a few Altcoins that are trying to develop day by day to surpass Bitcoin, for example, when comparing the anonymity of transactions, Bitcoin has some strong competitors such as Dashcoin, Monero, Namecoin, etc. Zcash coin.
An important factor that some Altcoins have improved from Bitcoin is the transaction time, where Litecoin and Fastcoin are two good examples when the update time per block has been improved. So when it comes to commercial value, these Altcoins always have an advantage over BTC due to their fast transaction processing speed. However, not all Altcoins are perfect, maybe strong in one point will be weak in another. Currently there are about 2,500 types of Altcoins.
Some Altcoins are more innovative by experimenting with useful features that Bitcoin does not have. Eg:
- Ethereum provides smart contract functionality, which is considered Bitcoin 2.0.
- Ripple is designed to make it easy for users to transfer currency and convert it to another currency for the recipient.
- BitShares describes itself as “a fair version of Wall Street.
Are Altcoins Really Necessary?
Some Bitcoinists argue that altcoins are unnecessary, and it won’t succeed, because Bitcoin’s infrastructure is too large to compete. However, altcoins play an important role. They help increase the liquidity of the cryptocurrency market, and attract more talented developers.
Developers can experiment with altcoins with novel features. Like some of the altcoins I gave above, it will do things that Bitcoin can’t do. This helps the cryptocurrency market satisfy the needs of users, and brings cryptocurrencies closer to real life.
Advantages and disadvantages of Altcoins.
Thousands of cryptocurrencies appeared, making the cryptocurrency market more exciting and there was a clearer decentralization of the cryptocurrency community. Those are good signals for the cryptocurrency market. And an opportunity for those who want to make money with crypto.
Currently, many Coins are favored and trusted by investors such as: BNB, ETH, XRP, ADA, LINK, ….
There is no coin without risk. Even the “big brother” of Bitcoin still has many factors that make users worry.
There are more and more “sharks” – people who hold large amounts of altcoins. They pump a lot of money into low-priced coins then sell them for huge profits. Many coins are short-lived.
SHOULD I INVEST IN ALTCOIN?
Due to the recent evolution of cryptocurrency and how quickly the landscape changes, all cryptocurrency investments carry a high degree of risk. To date, even Bitcoin has not been stable, and there are price fluctuations on a regular basis.
However, altcoins are more exponential change. Because they have a low market price (the total value of all coins combined), the altcoin market is highly susceptible to price manipulation. Wealthy merchants – known as “whales” – pumped huge amounts of capital into low-priced coins to build hype and drive prices up.
Once the price has risen significantly, the whales sell their coins on the exchange for a huge profit, hurting many investors who trust the process. This method is called ” pump and dump “. This not only hurts the greedy trader but also affects many other factors, but it often proves to be the breath of a short-lived altcoin. To better understand how the price of sharks works, and how to fight it, you should read through the article:
In addition, this market has a lot of potential altcoins, as long as you take the time to research and choose some of your favorite coins, this investment can bring very high returns for you. you in the future.
How to own altcoins.
Just like Bitcoin, there are many ways to get altcoins.
The first way: you can mine altcoins (altcoin mining) with a highly configurable computer like bitcoin mining. Usually the altcoin mining algorithm is easier than bitcoin, so the configuration of altcoin miners is also lower.
Second way: You can also buy and sell altcoins (trade altcoins) on cryptocurrency exchanges. Most exchanges use Bitcoin as an intermediary (although some directly use fiat currency pairs), so you will need Bitcoin to be able to trade altcoins. Major exchanges that support altcoins such as: Binance, Bittrex, Poloniex…
In addition, you can buy it on OTC exchanges, and some black markets are opened by an individual, or a group trusted by the community.
In Vietnam you can buy Bitcoin, or some altcoins on the exchange remitano, huobi OTCCurrently, these two exchanges are being trusted by many investors in Vietnam, if you do not know trading on these two exchanges, you should check out the following article:
The third way: Airdrop – Many altcoin communities also offer giveaways to increase their coin exposure and attract new users to join the community. This is a great way to buy coins if you don’t know how to mine altcoins, have little money or don’t have trading skills.
Altcoin storage wallet
Currently, many coins have their own storage wallets, in addition you can store them through hardware wallets like Ledger, Trezods… below is the article about the top 5 safest Bitcoin and Altcoin storage wallets today, you can refer to:
So Tapchibitcoin helped you understand what Altcoins are, and the importance of altcoins. Please share the article if you find it useful.
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