Altcoins are, by definition, any cryptocurrency that isn’t bitcoin, which means there are a lot of them: more than 14,000, as of November 2021. And considering bitcoin currently makes up around 40% of the total crypto market cap, more than half of the crypto market’s value is floating around in altcoins.
But all altcoins aren’t created equal. Some cost pennies, while others are hundreds of dollars per coin. Some have promising long-term applications, others are a flash in the pan. Many aim to build on bitcoin’s success, others claim to solve its problems.
What Are Altcoins?
Altcoins (alternative coins) is a term used to describe all cryptocurrencies other than Bitcoin (BTC). Their name comes from the fact that they’re alternatives to Bitcoin and traditional fiat money.
Altcoins are cryptocurrencies that use a technology called “blockchain” that allows secure peer-to-peer transactions. They build on the success of Bitcoin by slightly changing the rules to appeal to different users, and may involve less energy usage.
Pros of Altcoins
• Plenty of Choices: There are many altcoins in circulation in the market. That makes it easier for an investor to take a pick, based on returns, acceptability and other competitive advantages.
• Stability: For altcoins, the price fluctuations are generally low, unlike Bitcoins. This would be a great benefit for the investor since it is more stable, unlike the volatility associated with Bitcoins.
• Better Version than Bitcoin: It wouldn’t be wrong to say that altcoins are better and improved versions of Bitcoin in many ways. In terms of technology, they are more advanced, as they came after Bitcoin. Even in terms of transaction speeds, many altcoins are superior to Bitcoin.
Cons of Altcoins
• Lack of Acceptance: Many people are still not aware fully of altcoins. Thus, there is not much acceptance of the same in the market. And it is difficult to build an Altcoins that soon since now Bitcoin has become so popular.
• Market Value: Many Investors were not aware of altcoins until recently. Of course, Bitcoin is more popular and has a high market value as compared to altcoins, Investors wouldn’t want to invest in something that provides them with lower returns
Will altcoins overtake Bitcoin?
When Bitcoin first debuted, it was the only cryptocurrency game in town. Naturally, it had 100 percent share of the market, albeit a very small one at the time. As more altcoins continued to debut or hold initial coin offerings, they expanded the total crypto market cap and Bitcoin’s share of the market continued to dwindle, even if Bitcoin’s total market cap was still skyrocketing.
Currently, Bitcoin holds somewhere less than half of the total market value of all crypto coins. As more coins continue to add to the already-existing thousands, it’s reasonable to think that Bitcoin’s market share will dwindle further, even if its price rises.