What Are Altcoins?

With the tremendous success of Bitcoin, a great many altcoins rapidly followed as alternative digital currencies available for investment and trading using blockchain technology similar to Bitcoin. One prime example of this trend is Namecoin.

Launched in early 2011, Namecoin was the very first altcoin to utilize a decentralized registration domain name, making it very attractive to certain investors, as its decentralized domain made internet tracking and censorship extremely difficult. As a direct result, Namecoin quickly became one of the most popular trading and investment altcoin opportunities.

Of course, now there are any number of available altcoins, including Monero, Dash, Litecoin, Ripple and perhaps the most widely traded, Bitcoin, to name just a few. In fact, following the launch of Bitcoin, approximately 500 altcoins were created and launched. Most altcoins, however, differ slightly from Bitcoin in terms of hashing rate, transaction speed, and distribution method, which has led to many completely disappearing from the market altogether. Examples of sturdier altcoins are Ethereum and Litecoin. Litecoin employs a hashing algorithm distinct from Bitcoin and as a result, is often referred to as “the silver to Bitcoin’s gold”.

All altcoins, however, utilize an open-source, free platform at blockchain level, similar to Bitcoin, although many maintain much different policy rules built specifically for their use.