If you’re new to cryptocurrencies, you might be wondering what the heck an altcoin is. Altcoins are simply alternative coins to Bitcoin—which was the first cryptocurrency ever invented.
Altcoins are often forks of Bitcoin or other top cryptocurrencies with different features like different inflation models, different algorithms, and different target audiences. New altcoins are created every day, so it’s important to know what they are, how they work, and which ones you should be investing in right now.
In order to help you through the extensive and mysterious world of altcoins, we’ve put together a list of some up-and-coming altcoins that will help you diversify your portfolio and safeguard you against losses as you journey through the world of cryptocurrency markets. Read on to find out what they are:
Decred (DCR) may be a cryptocurrency that you haven’t heard of, but it’s worth taking note of. The brainchild of Bitcoin developers, Decred is a digital currency that is open-source, progressive, and self-funding.
It also comes with a system of governance stemming from its own community and integrated into its blockchain. The project has attracted a host of high-profile investors including Jack Dorsey, the CEO of Twitter.
One thing we love about Decred is its focus on decentralization. In fact, the very name “Decred” is a play on two words: decentralized and credits. The platform boasts an innovative proof-of-stake design which provides everyone using the network with the opportunity to participate in the voting for protocol changes and budget allocations through staking their coins.
Of course, the votes are weighted, the more coin you have, the greater your voting rights. But this is a universal problem with the so-called democracy of cryptocurrencies.
Weighted voted notwithstanding, this allows for more power to be given to those who have skin in the game when it comes to making decisions about the future direction of Decred’s development and gives its users the power to bear on its cryptocurrency value.
Ethereum Classic (ETC)
Ethereum Classic, or ETC, is an open-source, decentralized cryptocurrency that was created in 2015. Unlike the majority of altcoins (alternative cryptocurrencies), it was not created with the purpose of being a fork of another altcoin.
Instead, it started as a fork of Ethereum (ETH), which means that it’s still technically part of Ethereum’s blockchain history before diverging on its own path. ETC uses the Proof-of-Work (PoW) consensus algorithm to ensure network security and integrity.
This is similar to Bitcoin’s original approach before moving on to Proof-of-Stake (PoS). Compared to PoS networks, PoW networks require more energy but aren’t subject to any central authority—making them ideal for those who value transparency and no central control over a small environmental impact.
Monero is another alternative to Bitcoin. Like Bitcoin, it is a cryptocurrency used for transactions. However, Monero has several key features that make it unique and highly attractive for investors and those interested in using cryptocurrencies. Sow, how does Monero work?
Monero uses cryptography to secure transactions between its users. It doesn’t have a central authority in charge of its operation, as no one owns or controls the network behind it and this differs from government-issued currencies, which are regulated by central banks.
Like other cryptocurrencies, you can use Monero to pay for goods and services online at businesses that support it as a form of payment. You can also use any kind of exchange to buy Monero with fiat currencies like dollars or euros.
Monero’s watchword is privacy. Unlike most cryptocurrencies (including Bitcoin), your transactions on the Monero blockchain don’t reveal your identity or other personal information like your IP address. This offers added privacy, which is important if you value anonymity.
Additionally, if you’re worried about getting on the radar of hackers and scammers who might be looking for your financial details, this extra layer of security provided by Monero could offer greater peace of mind when making payments online.
Despite all existing units being equal in value, different units of currency can sometimes be valued differently due to their history or association with specific events (e.g., rare coins). This generally isn’t an issue with national currencies because multiple copies exist—but with cryptocurrencies like Bitcoin where there’s only one copy per unit in circulation, fungibility can become a problem since each unit must be distinguished from others by tracing its entire history and ownership trail.
With more than 3 billion people using social media platforms like Facebook and Instagram every month (and upwards of 15 million new users per day), companies need solutions that will allow them to scale their operations accordingly while keeping costs down.
Zcash (ZEC) is one of the most popular privacy coins that was originally launched in 2016. It is a cryptocurrency that offers complete anonymity to its many users. Anonymity is key to blockchain’s success because a known user’s details can be traced back to them, which might disrupt their investment activity and open them to the risk of being hacked, or worse.
If you’re already familiar with Bitcoin, you’ll know that it allows users to send or receive money without revealing any personal information. Anyone can view Bitcoin’s public ledger and this means they can see any BTC transaction going in and out of a Bitcoin wallet.
This works fine for many people but there are also situations where this lack of privacy isn’t ideal. This is where Zcash comes into play. It uses advanced cryptographic techniques to hide the sender, recipient, and amount of every transaction made on its blockchain.
NEM (XEM) is the world’s first Smart Asset blockchain. It was built from the ground up to perform at the level of enterprises, NEM’s blockchain technology delivers a unique platform for the management of almost any kind of asset: notarizations, currencies, ownership records, supply chains, and more.
NEM’s permissioned private blockchain delivers industry-leading transaction rates for internal ledgers. And NEM’s groundbreaking consensus mechanism and the Supernode program ensure that NEM’s open, public blockchain can grow without ever compromising throughput or stability.
Businesses using NEM can deploy their own blockchains that are customized to their needs – including their own security rules, consensus algorithm, and token structure – without having to go through a lengthy development process or pay licensing fees to another company. This further ensures relative stability to NEM’s cryptocurrency prices.
Why You Should Invest in Altcoins?
You may be wondering if investing in altcoins is worth your time and money. The truth is, that altcoins can be useful investments for several reasons:
First, altcoins are typically more volatile than Bitcoin. This means that there’s a chance for their value to grow faster than that of Bitcoin. In fact, some of the most impressive gains in the entire cryptocurrency market have come from altcoins rather than Bitcoin itself. For example, Neo experienced a 30-fold increase over the course of 2017 alone.
Second, when Bitcoin increases in value over time, it often does so because of growth in the altcoin market as well-meaning that you can benefit even if you only have investments in Bitcoin and not a single one of its counterparts!
Since they’re less well known or less liquid than Bitcoin itself (meaning fewer people have access to them), many investors make them part of their portfolio purely as insurance against volatility; but they also offer unique opportunities despite this risk because they aren’t tied directly into mainstream financial systems like traditional currencies are which means less government regulation. Altcoins provide an opportunity for those looking to make long-term investments without too much risk due to their decentralized nature.