Do you want to learn more about altcoins? Well, they were launched after the success of Bitcoin, and many cryptocurrency investors refer to them as the better substitutes to Bitcoin. So, what is an altcoin exactly, and should you invest in them? Keep on reading to find out.
What is an Altcoin?
An Altcoin is an alternative cryptocurrency launched after the success of Bitcoin. Altcoins are all decentralized digital currencies besides Bitcoin, and there are hundreds of altcoins listed on CoinMarketCap as of this writing. They rely on a protocol or set from rules that are different from the bitcoin protocol.
As they are alternatives for the original Bitcoin, altcoins are trying to improve what Bitcoin has to offer, target any perceived limitations that Bitcoin might have, and come up with competitive technology developments.
Bitcoin may be the first peer-to-peer digital currency, but altcoins are trying to improve functions like transaction speed, mining method, hashing, distribution method, and others. Currently, there are 885 different altcoins on CoinMarketCap.
Prominent examples of altcoins include Ether, Litecoin, Ripple, and Tether. And while some of those coins have survived until now and continue to develop, others might not survive for long.
What Was The First Altcoin?
The first altcoin that was created in the middle of 2011 is Namecoin. This altcoin was introduced to the market right after the creation of Bitcoin and is still one of the most innovative altcoins.
Also, it was the first to implement merged mining and a decentralized DNS. Namecoin is an open-source technology that improves censorship resistance, privacy, decentralization, and security.
It also improves the speed of particular components of the Internet Infrastructure. DNS and Identities are among those components. Namecoins’ goal is to make the web more resistant to censorship by protecting free-speech rights.
Should I Invest in Altcoins?
Many people are still unsure whether they should invest in altcoins or bitcoin. Some prefer bitcoin because of the hype that goes around this cryptocurrency, and I would not be surprised if you know a people or two that have bought bitcoin because “everybody else is buying bitcoins.”
Investing in cryptocurrencies is indeed an excellent way to increase your wealth over time. If you do your homework right, you have the chance of doubling or tripling your investment. But should you invest in altcoins?
Some people assume that altcoins are cryptocurrencies like bitcoin, but this is far from the truth. Most of the cryptocurrencies that are listed on CoinMarketCap have revolutionary ideas. These ideas have the potential to transform how we live in the future.
Moreover, when you buy a particular cryptocurrency, you are buying into the idea of that currency. What you see on CoinMarketCap or other platforms is the monetary token of the cryptocurrency, not the concept behind the name.
New in crypto?
If you are new to the crypto sphere, you might think that you need a significant amount of money before you start investing in cryptocurrencies. Well, this is not the case. Even if you don’t have money on the side, you can still invest without actually spending money.
If you have a computer with a CPU, you can mine altcoins as well as bitcoins. This is an excellent opportunity, especially when it comes to altcoins. The younger a cryptocurrency is, the easier the mining is. In other words, the mining difficulty of any altcoin is a lot lower than the mining difficulty of bitcoin.
Let’s not forget to mention that some altcoins offer passive income that is similar to the dividends shareholders receive from companies. For example, if you buy altcoins, let’s say Ark Coin, and keep them in your wallet, you can still earn money, which is an excellent source of passive income.
Altcoins have to potential to produce strong returns, which makes them appealing to many investors. They can be used for many purposes, such as making rapid or anonymous transactions. With all this being said, it would not surprise me if you want to know if it is possible to identify the cryptocurrencies that can double or even triple your income.
How Should I Choose The Best Altcoins?
If you are looking for a way to invest the money you have on the side and you are considering altcoins, then you might want to do in-depth background research.
It is not a surprise that with the massive success of Bitcoin, thousands of altcoins have been launched in the last couple of years. Many of those altcoins are created purely to make a profit for their owners and don’t have laudable goals. Luckily, you can read on popular cryptocurrency forums if an altcoin is a potential scam coin.
Typically, if a cryptocurrency has a good agenda, it will be backed by a reliable team and should have a track record in the community. Reviews can be found for almost all cryptocurrencies on the Internet. Also, if a cryptocurrency intends to stay on the market, it will continually improve what they have to offer and should be keeping all investors up to date with informative articles, newsletters, or posts.
If you consider becoming a part of the crypto sphere, it would be best to do background research first. The more you know, the smarter decisions you will make, and the lower the possibility of buying scam coins.
You should take a look at our article “The Most Promising Altcoins for 2019 “, where we have mentioned coins with a higher probability for future gains and positive reviews on the Internet.