Serving as a pioneer in the realm of cryptocurrencies, Bitcoin captured widespread attention and paved the path for the emergence of alternative digital currencies, commonly referred to as altcoins. As Bitcoin soared in popularity and its value skyrocketed, developers embarked on an expedition to unlock the possibilities offered by blockchain technology. Their goal was to forge new cryptocurrencies that would address Bitcoin’s limitations or introduce groundbreaking features. Consequently, a myriad of cryptos now exists within the crypto market, exhibiting a diverse and ever-growing landscape of digital assets. One of the well-known coins is DOGE, traded throughout all crypto exchanges. In May 2023, the Dogecoin USDT rate is $0.072. Let’s see the difference between the “father coin” and altcoins.
Bitcoin vs Altcoins in the Crypto Market
- Nature. Bitcoin and altcoins are types of digital currencies that rely on cryptography to ensure secure transactions and regulate the production of new currency units.
- Decentralization. Bitcoin and other altcoins use decentralized networks, which means they are not under the control of a central authority such as a bank or government.
- Blockchain Technology: Bitcoin and other alternative coins use a type of technology called blockchain. This technology is essentially a decentralized system that stores records of all transactions. This provides security, transparency, and the inability to make changes after the fact.
- Peer-to-Peer transactions. Bitcoin and other altcoins allow people to send and receive money globally without relying on banks or other intermediaries. Instead, users can directly send funds to each other without involving traditional financial institutions.
- Market presence. Bitcoin is the initial crypto and it still holds its position as the most famous and broadly accepted one. Altcoins refer to all other cryptos except Bitcoin.
- Purpose and functionality. Bitcoin is mainly utilized as a digital currency and a means of storing the value with the aim of challenging conventional financial systems. Altcoins, however, typically have different functions such as offering specialized features like smart contracts (found in Ethereum), privacy (in Monero), or scalability (in Litecoin).
- Value and volatility. Bitcoin is the most valuable cryptocurrency, but its price can change drastically. Altcoins price is lower and can be even more unstable, making them possibly riskier investments.
- Adoption. Compared to most altcoins, Bitcoin has a broader adoption and acceptance as a payment method. It is supported by many merchants, payment processors, and financial institutions. Although some altcoins may gain acceptance in specific industries or communities, their overall acceptance is typically lower.
- Liquidity and trading. Compared to altcoins, Bitcoin usually has greater liquidity and trading volume, which simplifies the process of trading. Altcoins might have lower liquidity and be restricted to certain cryptocurrency exchanges.
To learn how to invest in altcoins, visit the WhiteBIT blog and follow the instructions and guides.