What Are Altcoins? A Guide For Investors

Altcoins represent a diverse and rapidly evolving segment of the cryptocurrency market.
TABLE OF CONTENTS
What Are Altcoins?
Types of Altcoins
Why Altcoins Exist
Examples of Popular Altcoins
Pros and Cons Of Investing In Altcoins
Altcoins And The Future Of Crypto
Bottom Line
Frequently Asked Questions (FAQs)
There are thousands of cryptocurrencies traded every day. While bitcoin remains the cornerstone of crypto, it isn’t the only digital asset investors are curious about. "Altcoins," a term for every digital currency that isn’t bitcoin, aspire to offer features like decentralized finance (DeFi) functionality, enhanced privacy, and other specialized functionality.
This guide will break down what altcoins are, their purpose, types and the risks and rewards of investing in them.
What Are Altcoins?
Altcoins are cryptocurrencies created after bitcoin, often aimed at improving upon perceived limitations of the original digital currency. Unlike bitcoin’s focus on being one and only one thing — sound digital money — many altcoins seek niche roles, whether as utility tokens or decentralized governance tools.
Some focus on faster transaction speeds, while others aim to offer decentralized app ecosystems. Altcoins differ from one another in their underlying blockchain technology and governance. Some are open-source and community-led, while others are managed by central organizations.
These differences result in varying levels of decentralization, security and utility, making altcoins more experimental compared to bitcoin’s established role as a store of value and digital gold.