What is Altcoin?
Altcoins can be described as any cryptocurrency that is not Bitcoin (BTC). That said, since many cryptocurrencies have been forked from Ethereum, some people include Ethereum alongside Bitcoin. In that case, altcoins are all cryptocurrencies besides Ethereum and Bitcoin.
Consequently, many altcoins utilize different consensus mechanisms for transactional validation and the opening of additional blocks, or they try to set themselves apart from Ethereum and Bitcoin by offering various other capabilities. These altcoins are also made or launched by developers with distinct visions or purposes in mind. So, what are some of the top altcoins worth looking for? Let’s find out.
5 Best Altcoins to Buy in 2023
1. Ethereum (ETH)
Ethereum, released in July 2015, happens to be the most well-established and largest open-ended blockchain network yet. It allows for deploying and building dApps (decentralized applications) and smart contracts while excluding any interference, control, fraud, or downtime from third parties. To do this, Ethereum has its own built-in blockchain-based programming language.
Also, its potential applications tend to range widely, and its network is powered by ether (more commonly referred to as ETH), which is its native cryptocurrency.
Its first presale, which took place in 2014, saw an enormous response, highlighting the sheer amount of interest it had already garnered in such a short time. Furthermore, its ecosystem has seen increasing growth, mainly due to the rising popularity of its decentralized applications, collectibles, and various other artworks. That growth might see another massive boost next year since it plans on introducing sharding to improve scalability.
2. Binance Coin (BNB)
Facilitating cryptocurrency trading for over 600 cryptocurrencies, Binance is at the top regarding cryptocurrency exchanges. This can be reflected in Binance Coin, or BNB, the native token powering the entire exchange with a market capitalization of almost $40 billion.
Being at the top comes with its perks, which can be highlighted in the services provided by Binance, such as Binance Earn, the Binance Visa Card, the Binance Smart Pool, and more. The Binance Visa Card, in particular, enables users to convert tokens into fiat to use them on other services or products.
Although administrative fees are not included in the conversion, additional third-party fees, such as payment network fees, do apply.
3. Tether (USDT)
Tether is probably the most popular stablecoin out there. Hence, its value is fixed and backed by the US dollar. In other words, its price is supposed to stay at a constant $1. Stablecoin exempts the coin from being an investment like Bitcoin or Ethereum, the utility that arises out of its stability is of immense value. This utility becomes apparent for transactions that usually undergo challenges when certain funds are exchanged for USD, for instance.
4. Ripple (XRP)
XRP is the native token of Ripple, the blockchain-based virtual payment platform. The primary purpose of XRP is to function as an intermediate exchange mechanism between two networks or currencies or as a temporary settlement layer denomination. Consequently, it seeks to improve some of the limitations associated with conventional banks. So, transactions are cheap and settled within a matter of seconds on the Ripple network, unlike banks, which can even take weeks to complete a wire transfer.
5. Dogecoin (DOGE)
Dogecoin‘s origins started on a whim, which places it under the classification of cryptocurrencies known as “meme coins.” Despite that, it quickly saw an increase in followers in 2017, where it played an active part in the crypto bubble.
Its supply is unlimited and follows a scrypt technology, which can be an argument for a more consumer-friendly, quicker, and more adaptable alternative to Bitcoin. It even caught the attention of Elon Musk, who, in 2021, openly supported it and even put up a poll on Twitter asking users if Tesla should adopt it as payment.
Altcoins vs. Bitcoin
While Bitcoin still dominates the cryptocurrency market in terms of market capitalization, altcoins might offer more when it comes to features and utility. As it stands, Bitcoin’s primary function is that of a store of value, similar to that of gold. And although its potential to be a hedge against inflation is still up for debate, it has yet to offer any utility beyond mere speculation.
Altcoins, on the other hand, can have a range of functions. ETH, for example, powers this growing ecosystem of various decentralized applications that can serve all sorts of purposes, such as being a set of financial tools that improve on some of the drawbacks of traditional banking. Then there are stablecoins, which have all the characteristics of a proper currency combined with the convenience of digitalization.
In other words, stablecoins might truly make this ideal of “bringing the bank right to your doorstep” a reality. Not to mention their applications for the metaverse, where they can serve as a medium of exchange that can power entire worlds within the digital realm. Also, altcoins tend to be more scalable and less energy-intensive.
However, having said all that, other than market capitalization, Bitcoin might still have something over its alternatives. Due to it being the original cryptocurrency, it has become a sort of safe haven for investors. This is because there is a high chance that most altcoins might fade away eventually. Therefore, it can be a place where investors can flock in case the cryptocurrency sector is faced with economic turmoil.
Future of Altcoins
While we can never be too certain regarding the future, one thing that has a high chance of happening is that altcoins might eventually see more regulation. If the cryptocurrency landscape sees more regulation, it could result in more stability, which would greatly help, considering its already volatile nature. As a result, long-term investors would be better protected, the fraudulent activity would be significantly reduced within the cryptocurrency ecosystem, and clear guidance would be given so that firms could innovate in a manner that struck a good balance.
Another thing that is highly likely to occur is that Web3 platforms will continue to grow as more cryptocurrency projects focus more on utility than speculation. More growth here means more altcoins as well. However, quantity is not the only aspect that would grow. The same also could be said for the overall value of altcoins.
How to Buy Altcoins
There are a plethora of exchanges one can utilize when buying cryptocurrencies. For this guide, we will be using Bybit.
Getting Onboard
Go to Bybit’s webpage. You will see the sign-up button on the website’s upper right corner. By clicking on it, you will be redirected to the registration page. When you get there, you can sign up via email or mobile. So, add your email address, a strong password, and a referral code, which is optional. After understanding and accepting the terms and conditions, click the “create account” button. Next, you will be asked to verify your email, and a verification code will be sent to your email address. Once you have added that code and verified your email, you are all set to go.
Getting Started with Trading
Once you are done with registration on the web, you will be redirected back to the buy/deposit crypto page. Following that, users can either purchase cryptocurrency to instantly begin trading or deposit their cryptocurrencies into their Bybit wallets.
Bybit allows several options that one can use to purchase cryptocurrencies, such as P2P, One-Click Buy (through third-party payments such as Google Pay or credit cards), and Fiat Deposit. While spot pairs may be traded with USDT, DAI, BTC, or USDC, derivative pairs can only be traded with USDC or USDT.
Also, another thing to keep in mind when depositing or to withdraw funds on Bybit would be the KYC requirements since the platform utilizes KYC for customer identification and analyzing their relevant risk profiles.
Are Altcoins Good Investments?
Altcoins manage to keep attracting newer investors that are seeking higher returns. They can be a good choice for someone who plans on becoming a cryptocurrency trader since altcoins tend to be a lot more affordable when compared to Bitcoin. Also, whether or not altcoins are a good investment depends on the altcoin one is investing in. One factor that could play a role would be how well-established an altcoin is.
For instance, ETH can be classified as a good investment, especially considering the changes it is poised to undergo. Another factor could be the utility that it provides and the demand for that utility. Therefore, discerning such things can play a major role in determining whether an altcoin is a good investment.
Are Altcoins Safe?
Generally speaking, altcoins tend to be risky investments. The ones recognized as safe have built up their reputations enough to be reliable in the eyes of the public, such as Ethereum, Binance, and Tether, for instance. So, investors should always conduct thorough research if they want to invest in newer altcoins.
