If you are new to cryptocurrencies you have probably heard about Altcoins, Stablecoins, and of course Bitcoin. In this guide, we are going to tell you what the difference is among each one of them.

Bitcoin was the first cryptocurrency to enter the market, giving it an independent identity from all other tokens. Therefore all coins, except Bitcoin, are considered “alternative coins” and therefore called Altcoins. Stablecoins are forms of Altcoins or cryptocurrency that have their value linked to an outside source such as gold or the dollar and thus don’t experience volatile spikes as their value is tethered to an external reserve of funds.

What is Altcoin?

As mentioned before, Altcoins represents all cryptocurrencies that aren’t Bitcoin and they include well-known Altcoins such as Ethereum, Litecoin, and Cardano. They follow the footsteps of the Bitcoin evolution but they also address its limitations along the way.

What makes altcoins unique is that they’re not necessarily trying to overpower Bitcoin but are instead trying to help the industry move forward through innovation.

Types of Altcoins

There are over 4,000 altcoins on the market, and more and more are being developed every day. They can be categorized into mining-based Altcoins, security tokens, utility tokens and Stablecoins.

What is a Stablecoin?

According to The Top Coins, a coin only qualifies as a Stablecoin if there is a “collateral”–or an external pool of funds––that corresponds to each coin in existence.  This stability is what sets Stablecoins apart in the otherwise volatile crypto market.

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