Altcoin

Depending on the definition, altcoins are all coins other than Bitcoin or Bitcoin and Ethereum. Since most cryptocurrencies are forked from one of the two, altcoins would be an alternative to it.

Some altcoins are used to validate and process the transaction, open new blocks, or add to cryptocurrency value in another way. The main point is to oppose Bitcoin and show that the crypto market can be diversified.

Why Altcoins?

Altcoins were invented to oppose Bitcoin. Once this cryptocurrency gained popularity, there were many critics, including the limited number of blocks, slow validation, etc. Altcoins were made to solve all the Bitcoin issues and improve cryptocurrency transactions.

Many altcoins have the same main purpose as a Bitcoin – a peer-to-peer system transferring large amounts of data. However, while BTC can only be mined, altcoins can be created in alternative, energy-efficient ways. This is what makes them popular and valuable.

Altcoin Categories

As mentioned, altcoins serve to resolve the main BTC issues. We have 3 categories.

Mining-Based Altcoins

Security and Utility Tokens

Stable Coins

Altcoin Scams

While most scams are focused on Bitcoin, you would be surprised to see the number of complaints about altcoin fraud. Scammers don’t choose the means or the opportunity when it comes to extorting funds. People are convinced to change their cryptocurrency to a stable coin or to purchase utility tokens to fund their long-term wishes. In reality, they end up sending funds to fraudsters’ wallets.

Be quite careful and ensure to work with legitimate, regulated crypto trading providers.