What is an Altcoin, and how does it work in crypto?

Many cryptocurrency users have likely heard the term Altcoin, and this concept is addressed and explained in topic 7 of module 1 on altcoins in our introductory cryptocurrency course.

This topic, in a certain way, brings a bit of confusion since even in the origins of this term, its definition was not very clear since it was rigorous in the classification of most cryptocurrencies. When this term originated, it was used to classify or label a cryptocurrency that was different from Bitcoin. It is for this reason that many cryptocurrencies or active crypto projects were reluctant to use this term since they believed that it was used as a derogatory way to praise Bitcoin.

As blockchain technology has evolved and new cryptocurrency projects have appeared that have been very successful, this term has been affected. Still, it is something very subjective and depends on who you ask.

For example, currently, some personalities in the crypto world use this term to refer to cryptocurrencies that do things that Bitcoin cannot do or that, within its protocol, there are more advanced features than those of Bitcoin, as is the case with

Vitalik Buterin, the creator of Ethereum, uses the term Altcoins to refer to the most innovative cryptocurrencies and not simply to frame any cryptocurrency other than Bitcoin as an altcoin.

Main Altcoin within the cryptocurrency ecosystem

As we mentioned before, the concept of Altcoin or alternative currency generally refers to all those cryptocurrencies that are not Bitcoin or have functions other than Bitcoin.

And thanks to the tremendous development of digital asset markets and the evolution of blockchain technology, many new altcoins have been appearing and enriching the cryptocurrency ecosystem with their innovations, which is very positive since many of these new alternate currencies have been dotted, as the most popular in recent years.


Perhaps it is the most famous Altcoin in the world, and it is not the second cryptocurrency with the largest market capitalization for nothing. When Ethereum arrived in the crypto ecosystem, it did so in a market almost of clones since it entered a market full of cryptocurrencies based on Bitcoin.

Ethereum was a demonstration that it was not mandatory to take the same reins as Bitcoin to be a successful cryptocurrency. Let us remember that when Ethereum was launched among the most popular cryptocurrencies, we found Bitcoin and Litecoin, which are two very similar assets. Thanks to its innovative features, the Ether managed to position itself as the second largest cryptocurrency by market capitalization.

Among its main features, we find the creation of smart contracts, being the first cryptocurrency to implement this feature successfully, and many do not know how important this feature has been for the development of new features such as decentralized applications or crypto games.


It is one of the Altcoins that, in addition to this label, also has another tag, such as a stablecoin or Stablecoin; it is currently one of the best-positioned stablecoins in the market, being a world leader in commercial transactions with cryptocurrencies.

It is widely used due to its main characteristic, which is to serve as a cryptocurrency for commercial or salvage use. Since having a value equal to 1 US dollar, it is a very versatile digital currency and very well received by the public.

Coins like Tether are well accepted as altcoins since they offer something that a currency like Bitcoin cannot provide, which is the security that its price will not go up or down at any time.


It is one of the most popular Altcoins these days, coming from one of the largest cryptocurrency trading platforms; it is well known since being part of a complex transfer system in one of the largest exchanges in the world is almost must usage.

It is used for its great speed in transactions, as well as its meagre commissions and is a good option when making transactions of any amount. It is also an excellent option to save on commissions or exchanges with other cryptocurrencies.


Like Ethereum at the time, Cardano arrived in a very disruptive way since, with its arrival, it brought significant innovations that were very necessary within the cryptosystem. They also have a community that supports them in each of their decisions as a project.

Cardano is an Altcoin that, like Ethereum, has a protocol that allows the creation of smart contracts and a system for creating new coins, such as the Proof of Stake system.

Along with Ethereum and Solana, Cardano is one of the cryptocurrencies that have developed or helped to evolve the various levels of the Blockchain, the most appreciated at the moment being all those applications that work within level 3 of their respective chains of blocks.


This latest cryptocurrency, like Cardano, is one of the most recent developments to gain incredible popularity. It is that it came by solving problems that other currencies already presented, such as energy consumption through mining, being solved through the implementation of the system of proof of participation or the optimization of the transaction system achieving incredible scalability.

Thanks to the great reception of this cryptocurrency in the market, despite the general fall in prices, it managed to stay afloat and even recover part of its market capitalization, evidencing the support behind this cryptocurrency and how strong it is against other significant coins.

Articulos relacionados

Preguntas frecuentes

Currently, there are thousands of cryptocurrencies, and many can be classified in different ways, and new projects appear every year; if we take into account that the general definition of an altcoin is all those cryptocurrencies other than Bitcoin, we could say that there are thousands of Altcoins, so It would be tough to give an exact amount.

As we mentioned before, alternative currencies can solve multiple types of problems since they can be unique from one another, allowing their users to play with their unique characteristics, as is the case with Tether, which is widely used for cryptocurrency electronic commerce.

This depends, but the general answer would be no since, as we mentioned before, everything depends on the use we want to give to said currency or the problem that this cryptocurrency helps us to solve. For example, Ethereum is better than Bitcoin in creating intelligent contracts, but Bitcoin is better than other cryptocurrencies in holding funds.