When we talk about cryptocurrencies, the first thing people have in mind is Bitcoin. As the first cryptocurrency asset to be created, Bitcoin is one of the most recognized and sought-after crypto assets in the market. However, with the development of blockchain technology and crypto, there are now more and more Altcoins available on the market. Altcoin is the abbreviation of ‘Alternative’ and ‘Coin’, which is a general term for all cryptocurrency assets alternative to Bitcoin. The way Altcoins work is similar to Bitcoin. They operate on a blockchain network and are based on a peer-to-peer (P2P) system where all transactions do not require the authorisation of third parties such as banks.
What is Altcoin and how are they different from Bitcoin?
As explained above, Altcoins is a general term for cryptocurrency assets alternative to Bitcoin. Just like Bitcoin, you can trade Altcoins to earn profits. Many Altcoins are built with features that are not present in Bitcoin. To be able to compete with Bitcoin in the market, Altcoins must have a competitive advantage. For example, Bitcoin offers a digital P2P transaction system. On the other hand, Ethereum is a type of Althcoin that focuses more on building a blockchain network to create a decentralized system for carrying out any transactions. The verification of Bitcoin transactions in mining also requires a lot of power so they are more expensive. On the other hand, most Altcoins have systems that aim to reduce the costs and complexity of mining and to be able to perform more transactions at the same time.The smart contract feature that Bitcoin does not have also allows other types of Altcoins that have it to build innovative applications on their network.
In April 2020, the trading volume of Altcoins alone reached 35 percent of the total digital asset trading market capitalization. Although Bitcoin still dominates the cryptocurrency market, there are several types of Altcoins such as Ethereum that have managed to dominate 30% of the market. Although it has not been able to shift Bitcoin’s position, the future of Altcoins has been shown to be promising.
Pros and cons of Altcoins
Altcoins certainly have their pros and cons. In the long term, there are a few Altcoins that have a good opportunity to grow which can provide you with good capital gains. Beyond that, Altcoins have more diverse functions and features compared to Bitcoins, so they can give you flexibility in transactions, and can also make the transaction cost cheaper than Bitcoin. If you are interested in investing in Altcoins, there are many types of Altcoins with good potential to consider.
However, the value of Altcoins still tends to fluctuate more than Bitcoin. This is because Bitcoin itself has been around for a long time hence the prices are more stable. This does not mean that the value of Altcoins will depreciate in the long term, on the contrary, there is still a good chance of appreciation. However, you have to be more careful in reading the market and choosing the right type of Altcoin to invest in, especially with the number of crypto scams and frauds.
Types of Altcoins
Are you interested in investing in Altcoins? Before rushing to invest, first study the types of Altcoins in the market and choose a trusted investment platform to invest with. With Tokenomy Earn, you can stake using Altcoins and earn an annualised yield of up to 5%. If you are interested, here are some types of Altcoins that you can choose as an investment instrument on Tokenomy:
- Ethereum (ETH)
Ethereum (ETH) is the second most popular Altcoin after Bitcoin by market cap. ETH was created in 2015 and has a different purpose compared to Bitcoin. While Bitcoin was created as a digital payment instrument, Ethereum was created as an open-source service that uses blockchain technology. The network is also used to build applications and smart contracts. This allows Ethereum to facilitate transactions and facilitates developers without a third party. On Tokenomy, you can stake using this asset and earn an annualised yield of up to 5%. You can earn rewards by participating in the Ethereum Network.
- Tezos (XTZ)
Tezos (XTZ) is a cryptocurrency derived from a decentralized ledger of blockchain technology. Just like Ethereum, Tezos is also designed to be able to use smart contracts. Ledger from Tezos was created to be a network that continues to grow and is flexible. In this use case, Tezos grants permission to anyone who owns XTZ assets to submit ideas or make changes to existing rules in their system. Once a decision is made, the existing software will automatically make changes to follow the existing decision. On Tokenomy Earn, you can stake XTZ and earn up to a 4% annualised yield.
- Tron (TRX)
Tron itself is a decentralized platform based on blockchain technology and uses a P2P system as a digital entertainment content sharing system. On Tron, users can share content with anyone and at any time. On Tron, you not only produce content to share with the public, you can also get rewarded. TRX is a cryptocurrency token provided by Tron for users to own and trade. On Tokenomy Earn, you can stake TRX and earn up to a 4% annualised yield.
- Polkadot (DOT)
Polkadot (DOT) is a blockchain-based cryptocurrency that allows multiple networks to be interconnected. In 2020, Polkadot is elected as one of the best performing Altcoins. DOT currently is the fifth largest cryptocurrency with a market cap of $26 billion dollars. As such, many people foresee DOT to become a strong competitor to ETH. DOT can be one of the ideal Altcoin to stake on Tokenomy Earn, where you can earn up to 4% annualised yield.
If you are a newbie and want to start investing using Altcoins, the staking system on Tokenomy is very simple to use! All you need to do is register an account through Tokenomy Earn’s website and verify your account. Once this is done, you can access your Tokenomy Earn dashboard, click on the staking tab option to select the altcoin asset you wish to stake. Finally, deposit the specified minimum asset to start staking. Good luck!