What is an altcoin?

An altcoin is a term used to refer to all cryptocurrencies other than Bitcoin.

Altcoin: definition

The term “altcoin” is often used to describe all alternative currencies to Bitcoin, which are often based on the same or similar source code platforms, but have different features and purposes.

There are many altcoins on the market, each with its own community of developers and users, as well as its own unique features. Some altcoins are designed to be used as payment methods, while others are intended to be used as platforms for creating and managing smart contracts.

The different types of altcoins:

There are many types of altcoins on the market, each with its own characteristics and purposes. Here are some examples of the types of altcoins that can be found in the market:

• Payment altcoins: these altcoins are designed to be used as payment methods to purchase goods and services online. They include currencies such as Litecoin, Dash and Monero.
• Platform altcoins: These altcoins are designed to be used as platforms for creating and managing smart contracts. They include currencies such as Ethereum and EOS.
• Value Altcoins: These altcoins are designed to be used as a means of storing value, such as physical gold. They include currencies such as Bitcoin Cash and Binance Coin.
• Privacy altcoins: These altcoins are designed to protect users’ privacy by hiding their transactions and identities. They include currencies such as Zcash and Grin.
• Entertainment altcoins: These altcoins are designed to be used in the entertainment world, such as music, games and media. They include currencies such as Decentraland and Enjin Coin.
• It should be noted that this list is not exhaustive and there are many other types of altcoins on the market.

Difference between token and altcoin:

Tokens and altcoins are both forms of cryptocurrency, but they have different features and functions. Here are some key differences between tokens and altcoins :

• Development platform: tokens are typically developed and deployed on an existing platform, such as Ethereum, while altcoins are independent currencies that have their own development platform.

altcoin has its own blockchain – token doesn’t have its own blockchain

• Functionality: Tokens often have a specific function within the platform on which they are developed, such as representing an asset or a voting right. Altcoins, on the other hand, are generally designed to be used as a means of payment or to store value.
• Value: Tokens generally have a value related to their use within the platform on which they are developed, while altcoins generally have a value based on their utility as a means of payment or as a store of value.

It should be noted that these differences are not absolute and that there may be overlap between tokens and altcoins. For example, some tokens may be used as a means of payment and some altcoins may have specific functions within their platform.

What is certain is that all altcoins are tokens, but not all tokens are altcoins.

Exemples:

Altcoins:

Ethereum (ETH): This is one of the largest cryptocurrencies after Bitcoin. Unlike Bitcoin, which aims to be a digital currency, Ethereum is a platform on which developers can build decentralized applications (dApps) and smart contracts.
Ripple (XRP): Unlike most cryptocurrencies, Ripple aims primarily to facilitate cross-border transactions for financial institutions and banks.

Tokens:

ERC-20 Tokens: These are tokens built on the Ethereum blockchain according to specific standards. For example, the BAT (Basic Attention Token) token is an ERC-20 used in the Brave browser to reward users for their attention to advertising.
Non-fungible tokens (NFTs): NFTs are unique, indivisible tokens that represent ownership of unique digital assets such as artwork, videos, tweets, etc. For example, CryptoPunks or digital artworks sold as NFTs.

The main difference between altcoins and tokens is that altcoins are stand-alone cryptocurrencies, often with their own blockchain, while tokens are created and usually operate on an existing blockchain using its protocols and standards, as is the case with ERC-20 tokens on Ethereum.