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What is an altcoin?

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What Is An Altcoin?

 

The term altcoin refers to cryptocurrencies that are alternatives or derivatives of Bitcoin. Since the birth of Bitcoin, innovators have been taking shots at perfecting the formula that made it so enticing and getting rid of the issues that are holding it back. 

 

Altcoins are the various takes on cryptocurrency that change the rules and parameters that Bitcoin set all those years ago. While usually having better transaction fees, and faster trading times the numerous amounts of coins have made space for some fraudulent coins to appear as well as, altcoins are commonly associated with unpredictable volatility even when compared to the rocket ship that is Bitcoin. 

 

 

      List of Popular Altcoins

                   Ethereum

                      Tether

                    Polkadot

                     Litecoin

                    Chainlink

                      Ripple

                        

 

               Types of Popular Altcoins

 

                    

                    Mining Based Coins

      Born from the same vein as bitcoin, these coins are generated through a process of solving complex math problems to unlock blocks and obtain new coins. Apart from Bitcoin, Ethereum and many others have followed this strategy. EX: (Litecoin,Bitcoin,Ethereum)                         

                                   

                        Stable Coins

The main purpose of Stablecoins is to reduce the volatility usually associated with crypto. In actuality, this is usually achieved by attaching the value of the coins to currencies that already exist. By far the most popular Stablecoin is USDT or Tether which is tied to the US dollar value. EX: (US Tether, USDC, DAI)

 

 

                          Security Tokens

Security tokens are usually linked to an actual company. Most of the time they launch in a process called an initial coin offering aka an ICO. These tokens often promise ownership or some type of payout in exchange for funding in another form of currency, so they often draw comparisons to stocks.  

 

 

                             Utility Tokens

Utility tokens are designed as forms of payment for a particular service or product, it is not uncommon to see utility tokens offer an ICO to build up momentum and funding. Solarcoin is a perfect example of a utility token, it is a token built for the trading of solar power energy. Ex: (Vet,Filecoin,Chainlink)