What Are Altcoins In Simple Terms: Types And Examples

Though Bitcoin ignited the crypto wave, countless altcoins have since appeared, each bringing valuable features that are now integral to the market.

This guide will clarify what altcoins are. We'll examine various kinds of them, provide noteworthy examples, and outline the process of purchasing altcoins.

What Is An Altcoin?

All cryptocurrencies, except Bitcoin, are considered altcoins. The term came about because these digital assets provide alternatives to BTC’s limited functionality.

Bitcoin is built as a decentralized currency and store of value. Altcoins, however, serve various purposes, such as faster transactions, smart contracts, or entertainment, like meme coins.

Types Of Altcoins

As you may have figured, the altcoin market is wide-ranging and full of variety, with each coin serving a different function. Here are the main altcoin types you might encounter.

• Stablecoins like USDT and USDC.

• Utility tokens like Uniswap and Jupiter.

• Meme coins like Dogecoin and Shiba Inu.

• DeFi tokens like Aave and Maker.

• CEX tokens like Cryptomus token and Binance Coin.

Let's inspect them more closely. Stablecoins ensure price consistency by linking their worth to assets like gold or the U.S. dollar. This lets users make blockchain transactions without the risk of price changes.

Utility tokens enable users to interact with a particular blockchain service or network. They do not signify ownership but are indispensable for engaging with dApps.

Meme coins are community-driven coins, often inspired by internet culture. Most of them started as jokes but have built strong communities and gained real-world usage. Their momentum largely depends on digital trends, public interest, and speculative activity.

With DeFi tokens, users can perform lending, borrowing, and trading activities independently of financial middlemen. These tokens are crucial to decentralized trading and lending frameworks.

CEX tokens, created by centralized exchanges, offer benefits like cheaper trading, staking rewards, or voting rights. They help keep the platform running smoothly.

Examples Of Popular Altcoins

As of now, there are over 14,000 altcoins in circulation. This figure continues to rise, as new ones emerge consistently. Still, some projects are standing out due to their strong adoption and unique use cases. The most popular altcoins include:

• Ethereum (ETH)

• Solana (SOL)

• XRP (XRP)

• Cardano (ADA)

• Dogecoin (DOGE)

• Shiba Inu (SHIB)

• Binance Coin (BNB)

• Polkadot (DOT)

• Chainlink (LINK)

• Avalanche (AVAX)

Bitcoin Vs Altcoins

With its dominant market cap, Bitcoin leads the cryptocurrency space. Its dominance shows how BTC is doing compared to other coins. There's even a Bitcoin dominance chart that shows how its market cap compares to the entire market.

When BTC’s dominance grows, investors usually prioritize it, sidelining altcoins. But as smaller projects get more attention, Bitcoin’s dominance drops. But should the price suddenly fall, it may ignite panic selling, driving altcoins down sharply.

Additionally, altcoins often reflect Bitcoin's price changes, particularly in times of volatility. Its variations are a crucial element in shaping the general mood and actions of the crypto market. When Bitcoin rises, they often follow. Altcoins also typically fall when Bitcoin does, though certain ones may see an increase as investors seek other options.

How To Buy Altcoins?

Thankfully, acquiring altcoins is simple. They are typically found on cryptocurrency exchanges, and it works much like buying Bitcoin. To buy altcoins, simply adhere to these instructions:

• Pick a suitable crypto exchange.

• Create an account.

• Deposit funds.

• Select an altcoin to buy.

• Make an order.

• Secure your coins.

Upon completing your purchase, transferring your funds to a secure personal wallet is the safest option. You can leave them on the exchange wallet if you plan to trade soon, but for long-term storage, a transfer is preferable.

Most Promising Altcoins Right Now

While the most popular altcoins have been discussed, what about those with the greatest potential? Several altcoins are currently showing strong signs of growth. Among the most discussed projects are:

• Solana – A rapid, expandable blockchain gaining popularity in DeFi and NFTs.

• Cardano – A blockchain supported by research that emphasizes sustainability and the development of smart contracts.

• XRP – Famous for speedy international payments, it is acknowledged for its rapid transaction speeds.

• Rollbit – An emerging platform in gaming and DeFi, it's recognized for its creative strategy in online wagering.

• BONK – A meme coin growing quickly thanks to its community support and social media buzz.

• FLOKI – A meme coin based on Elon Musk’s dog, Floki, with a loyal following.

• POPCAT – A crypto inspired by a meme, quickly rising in popularity for its viral appeal.

• Arbitrum – An Ethereum Layer 2 solution optimized to elevate scalability and expand transaction volume.

• Hedera – A quick and safe blockchain tailored for business applications.

• Pepe Unchained – A coin inspired by the Pepe meme, increasing in popularity alongside a committed community.

FAQ

Is Ethereum An Altcoin?

Yes, Ethereum is considered an altcoin. Its creation aimed to offer enhanced capabilities beyond Bitcoin, particularly through smart contracts.

Is XRP An Altcoin?

XRP is classified as an altcoin. Its primary goal is to streamline quick and affordable international payments. This focus has led to its extensive adoption within the financial and banking sectors.

Is Solana An Altcoin?

Solana is an altcoin with a lightning-fast blockchain that supports thousands of transactions per second. Its ecosystem has grown swiftly, especially within DeFi and NFTs.

Is Shiba Inu An Altcoin?

Yes, Shiba Inu is an altcoin, specifically a meme coin. It started as a joke but quickly grew, even launching its own exchange, ShibaSwap.

Is Dogecoin An Altcoin?

Dogecoin is an altcoin and one of the original meme coins. Its massive following grew quickly, particularly thanks to endorsements from Elon Musk.

Is Cardano An Altcoin?

Cardano is an altcoin and a utility token for the Cardano blockchain. It enables smart contracts and dApps, distinguishing itself from others. Its emphasis on scalability and sustainability sets it apart in the world of altcoins.