There are thousands of altcoins, but how many of them will remain resilient in the post-crypto winter period?
The last few months have been troublesome for some investors, especially if they needed more experience and crypto education because the overall market capitalization has registered a slight drop. Crypto traders witnessed a value erosion for all digital currencies and were faced with the need to rethink their strategies and investment plans.
However, October has been the bullish month of 2022, even if the market is still in a bear phase, and investors could profit if they diversify their portfolios and adapt their investment strategies. Crypto specialists refer to October 2022 as Uptober because it brought profits to Bitcoin investors and not only. While Bitcoin is the grandfather of digital currencies and is well-known in the market, alternative coins are also great candidates for generating revenue.
If you already have Bitcoin in your portfolio and think it might be the time to diversify it with a couple of alternative coins, here is what you should know about them.
What are altcoins?
Altcoins are digital currencies that were created as an alternative to Bitcoin. Bitcoin has been named the 1st generation cryptocurrency, and altcoins are second and third generations of digital tokens. Some digital coins nail it at bridging the gaps Bitcoin left and are highly valued in the industry. Ethereum, the most popular altcoin, introduced the concept of programmable money (smart contracts) on the market.
Is this the altcoin season?
Crypto experts wonder if this might be the altcoin season now that Ethereum has completed the Merge and managed to maintain the eth coin price at decent values considering the bear market. However, the altcoin season will officially start when Bitcoin’s market capitalisation dips below the other digital coins. The market cap tells how big a token is on the market because it’s calculated by multiplying its unit price by the circulating supply.
Altcoins expected to trigger rage in the crypto sector
Ethereum
We cannot talk about altcoins without mentioning the most popular of them all, Ethereum, a decentralised software platform that introduced the smart contract functionality for the first time on the market and put the base for DeFi. If you’re faintly aware of crypto, you heard about Ethereum; the token Vitalik Buterin launched in 2015. This blockchain platform has been heralded as the second generation of digital currencies, and its smart contracts feature positioned it at the top of the list of altcoins. The smart contract functionality allows crypto traders to complete transactions without the involvement of a third party or central authority as long as they follow a list of pre-established rules. All transactions on the Ethereum blockchain are secure, verifiable, and immutable, giving the participants complete visibility and ownership of the transaction data.
Polygon
Some crypto experts believe 2022 is the year for Polygon because its community generated a lot of buzz around it. It’s a layer-2 network that supports the Ethereum blockchain to streamline the level 1 Ethereum platform at lower costs. MATIC, the network’s native currency, is used for governance purposes, to pay fees on the network, and for staking. Crypto specialists describe Polygon as a possible solution to the scalability problems the Ethereum blockchain experiences. Due to its proof-of-stake sidechains, it completes over 65,000 transactions per block, being one of the quickest blockchains available.
Cardano
Cardano is one of the most exciting projects on the market, as it’s the most developed proof-of-stake crypto available. All crypto investors admit that Cardano is a carefully designed blockchain platform with extensive peer-review systems and processes that might allow it to overthrow Ethereum one day.
Cardano is a third generation of crypto, and its native token, Ada, is registering a bearish chart pattern. Even if it has seen better days, the blockchain is still considered one of the best additions to a portfolio due to its dedication to upgrading its ecosystem and making it more conductive for Web3 app development.
Tether
Tether is a first-generation stablecoin connected to the US dollar and promises to offer a 1-to-1 match with the fiat currency. It was created to provide investors with a digital currency that doesn’t experience the same high volatility level as other currencies. Tether works across other blockchains like Bitcoin and Ethereum, and at present, it supports several other fiat currencies (Mexican peso, euro, British pound).
Decentraland
Decentraland was the top metaverse token until Apecoin was launched in 2022 and stole some of its popularity. Decentraland, with its native token MANA, are Ethereum based and can be used to pay for purchasing virtual plots of land in Decentraland.
Decentraland is a unique altcoin because it was the first digital token to present the concept of a decentralised virtual world, allowing users to interact with each other and the ecosystem. Users can use several tokens to complete transactions, but LAND is the most popular one, and according to its white paper, it’s a transferable 3D virtual space and non-fungible digital asset people can purchase and own.
Algorand
Algorand relies on the proof-of-stake consensus and is an open-source, two-tired and permissionless network. It was developed to improve the blockchain trilemma and attracted significant private investors’ funding. Users can gain rewards and stake with ALGO, the native utility token of Algroland. It’s a unique altcoin because when new ALGO tokens are introduced, the existing currency holders receive a portion of them.
Uniswap
Uniswap is another unique altcoin because it functions as a crypto exchange that relies on a decentralised network protocol. The protocol powers automated transition between digital currency exchanges on the Ethereum blockchain through the employment of smart contracts. Uniswap gained popularity in the crypto world because it enabled crypto exchange without the regulation or interference of any other organisation. Even if its price decreased compared to its highest value, it’s still one of the top-performing altcoins according to its market cap.
So, should you invest in altcoins?
The present crypto market setting encourages investors to diversify their portfolios, and adding these unique digital currencies to yours can help you get a return on your investment.
