Altcoins
Altcoins are cryptocurrencies other than Bitcoin. These guides explain how XRP, Cardano, Litecoin, Chainlink and other altcoins work, and their risks. Some altcoins, such as Litecoin and Bitcoin Cash, started from Bitcoin’s code. Others run apps, feed outside data to blockchains or pay for file storage. Dogecoin began as a joke and became a well-known meme coin. Smaller coins can have sharp price swings and thin trading, and some projects shut down. Each guide explains what a coin is for and which risks to check first.
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What are payment coins and meme coins?
They are coins built mainly for sending value, or coins that became popular through internet culture. Bitcoin Cash split from Bitcoin in 2017, and Dogecoin started as a joke.
Which altcoins pay for a network service?
Some tokens pay for a service on their own network. Chainlink connects blockchains to outside data such as prices, and Filecoin rewards people who store files for others.
How do you check an altcoin's risks?
Look at what the coin is for, how much of it exists and how easily it trades. Price swings, thin trading and projects that close are common risks with smaller coins.
Key terms
- Altcoins An altcoin is any cryptocurrency other than Bitcoin, from large networks such as Ethereum to stablecoins and meme coins.
- Circulating Supply Circulating supply is the number of coins or tokens publicly available in the market now, excluding locked, reserved or not-yet-created coins.
- ICO An ICO or Initial Coin Offering is a cross between an IPO (Initial Public Offering) and a crowdfunding campaign for a blockchain-based project, offering the…
- Destination Tag (Memo) A destination tag is a number added to an XRP payment that tells the receiving service, such as an exchange, which customer to credit.
- ERC-20 (Ethereum Request for Comments 20) ERC-20 is the technical standard most tokens on Ethereum follow, setting the functions every token must offer so wallets and apps can handle them alike.
- Pump and Dump A pump and dump is a scam where promoters hype a coin or token to push its price up, then sell at the inflated price.
Frequently asked questions
What is an altcoin?
An altcoin is any cryptocurrency other than Bitcoin. The name is short for alternative coin. Ether, XRP, ADA and Dogecoin are all altcoins. Some people count stablecoins as altcoins too, while others treat them as a separate group.
How are altcoins different from Bitcoin?
Each altcoin has its own rules, network and developers. Some, such as Litecoin and Bitcoin Cash, started from Bitcoin's code and changed some of its rules. Others, such as Cardano, run smart contracts and apps, and some tokens pay for a service, such as Chainlink data feeds or Filecoin storage.
Are altcoins riskier than Bitcoin?
Altcoins carry the same basic risks as Bitcoin, plus some of their own. Smaller coins can have thin trading, so their prices can move sharply, and some projects are abandoned or shut down. Before you buy any altcoin, check what it is for, who builds it, how much of it exists and where it trades.
What is a meme coin?
A meme coin is a cryptocurrency that became popular through internet jokes and social media rather than a specific technical use. Dogecoin, launched in 2013 and first meant as a joke, is a well-known example. Meme coin prices can depend heavily on online attention, so they can rise and fall very quickly.
How can I check an altcoin before I buy it?
Start with the project's own website and documents. Check its total and circulating supply, how long it has existed, who builds it and whether it is still maintained. Look for independent coverage, not just social media posts, and be careful with any coin promoted with promises of returns.
