Last updated on December 7th, 2021 at 06:34 am
An altcoin is an alternative cryptocurrency to the traditional and most popular ones like bitcoin. They are currently on the rise due to the volatility of the cryptocurrency market, which carries many risks. With an altcoin, transactions are much faster, it is generally less volatile than bitcoin and arguably has a higher level of stability. In addition, altcoins have an influence on the process and scope of the blockchain.
Since the emergence of bitcoin, the concept of a decentralized peer-to-peer (P2P) payment network has inspired the establishment of multiple digital assets. The cryptocurrencies that emerged after bitcoin are called 'altcoins'. Their name is a fusion of "alternative" and "coin".
With Namecoin came the onset of altcoins, which started in 2011 and it was created using the same blockchain technology engine as bitcoin. Namecoin is an integral part of the altcoin story as it proved that there is enough room in cryptocurrency markets for more than one type of digital asset.
Today, of the total cryptocurrency market, altcoins represent approximately 31% of it and bitcoin represents the remaining percentage. Many altcoins share the main characteristics of bitcoin, as they do not depend on banks, financial establishments, or any kind of the third party to be transferred from one person to another.
The Blockchain Technology
By using blockchain technology, details on transactions are accumulated in blocks that need to be verified to guarantee that they are genuine. In this sense, as soon as the block is approved by an algorithm, it is converted into an official part of the general distributed book. Since the blockchain is put in storage on servers and computers all over the planet, it is almost impossible to hack such a huge system. For that reason, blockchain technology is thought to be reliable and the financial future.
How Do You Get Altcoins?
Similar to bitcoin, altcoins can behave as both assets and currencies. The simplest way to obtain them is to buy them online. Today, there are over 350 different exchange platforms where altcoins get traded each day. Among the most popular cryptocurrency exchange sites are Bittrex, Kraken, Binance, and Coinbase, but you can also buy and sell selected cryptocurrencies over numerical payment systems such as Venmo or PayPal.
The prices of altcoins are established by sellers and buyers transacting on the exchanges, and therefore prices for the cryptocurrencies can be quite volatile. To purchase them, you will have to have a digital wallet where you can store the altcoins. When selecting a wallet, you should be careful to know the cryptocurrencies it allows because not all of them except the ones on the market.
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Conclusion
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