Altcoins, explained

written by OKCoin

Altcoins, explained

For some traders and investors, there’s Bitcoin, and then there are all the other cryptocurrencies. Those other cryptos are all broadly referred to as an ‘alternative coin,’ or shortened to ‘altcoin.’ 

Today, the total cryptocurrency market capitalization is about USD $275 billion (down from a high of about USD $800 billion in 2018). The altcoin market cap, the total market excluding Bitcoin, is about USD $100 billion, meaning that Bitcoin’s market cap is ~1.7 times all other cryptocurrencies combined.

What is an altcoin?

With the first issuance of bitcoins in 2009, permissionless digital currencies were born. The success of Bitcoin paved the way for the crypto industry, spawning many types of cryptos that support projects as native currencies, provide unique privacy functionalities and attempt to provide price stability. Bitcoin is the dominant crypto, everything else is an altcoin.

Since 2009, some 5,700 alternative cryptos have been created, all vying to provide functionality that is better than, or complementary to, Bitcoin. While Bitcoin introduced an innovative and revolutionary model for decentralized trust, permissionless transactions, and sound money, developers have identified problems with the protocol. Altcoins are often their answers to these problems, providing systems for less volatility, more efficient transactions, and increased privacy and autonomy. As a result, altcoins have broadened the scope of what’s possible with blockchain technology.

Why altcoins?

The growth in cryptos available provides new market opportunities and greater choice for traders and investors. Increased selection provides opportunities for portfolio diversification within crypto markets. 

Altcoins supported by OKCoin:

What is altcoin season? 

Also referred to as ‘altseason,’ altcoin season is when altcoins experience a new wave of interest and investment, usually because Bitcoin volatility is low, or when the price of BTC falls.

Decentralized finance (DeFi) tokens, which have recently had a resurgence of yield farming due to higher interest rates, are presently driving a high amount of growth for altcoins. The market cap of the top 100 DeFi tokens currently sits at about USD $7.5 billion. Learn more about DeFi.

Today, one of the internet’s most infamous altcoins, Dogecoin (DOGE), is experiencing a massive rally after a pro-DOGE TikTok video went viral. 

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