Altcoins arose immediately after Bitcoin (BTC) and provided a viable alternative to the most well-known cryptocurrency. It accounts for over 80% of the cryptocurrency market with over 5,000 cryptocurrencies in use.
This article covers a variety of topics, including what an altcoin is, how to buy altcoins on various platforms, and how to trade them.
Cryptocurrencies provide a plethora of entry points into the industry. At the time of writing, over 6,000 cryptocurrencies were traded on 250 different exchanges across the world. Every day, new cryptocurrencies emerge while old ones fade out of favor. The market is growing at the moment. The crypto gold rush is attracting an increasing number of investors, corporations, governments, and consumers.
Altcoins provide users the chance to make a lot of money, especially if they know how to get the most out of the altcoins they currently hold. This may be used as a brief guide for first-time cryptocurrency investors.
What Is An Altcoin?
The term “alternative coin” is abbreviated as “altcoin.” Altcoins, which include Litecoin (LTC), Uniswap (UNI), Dogecoin (DOGE), Zcash (ZEC), and Cardano, are all cryptocurrency coins that are not Bitcoin (BTC) (ADA).
Since Bitcoin’s debut in 2009, a few other cryptocurrencies have emerged, with more appearing regularly. These Bitcoin alternatives begin to deviate from the Bitcoin consensus method, adding various privacy features, functions, and supply schedules.
The altcoin approach of adding extra features makes them more appealing and valuable than their original equivalent (Bitcoin), and investors see them as having more usefulness.
Are you wondering if buying a bitcoin with your credit/debit card is easy or difficult, or you got stuck while trying to buy a bitcoin? See How to Buy Bitcoin with Credit or Debit Card.
The following are some of the most popular altcoins on the market right now:
By market cap, Ethereum is the second-largest cryptocurrency after Bitcoin, and it is also the largest altcoin. Many investors, however, no longer consider it an altcoin because of its price stability potential; it is a more risk-adjusted investment than most altcoins.
Ethereum was the first blockchain to provide smart contracts, paving the way for decentralized finance (Defi) and the new financial instruments that have emerged as a result. In contrast to Bitcoin, which is primarily a transactional protocol, Ethereum is regarded as a true money protocol.
Ethereum may also be used to lend, borrow, short, and long, among other things that are not possible with Bitcoin’s foundation layer.
If you are looking to invest in Ethereum, you need to know this Before You Invest In Ethereum- This is What You’re Facing In 2022
2. Litecoin (LTC)
Litecoin is a fork of the original Bitcoin mechanism and is known as the silver counterpart to Bitcoin’s gold. It uses a new hashing method (Scrypt) and has a higher block processing speed, resulting in a 4x increase in production capacity over Bitcoin. It was, however, condemned as a pointless (and ultimately unneeded) Bitcoin fork.
3. Stellar (XLM)
Stellar, unlike the majority of cryptocurrencies, concentrates on international bank transactions. Stellar uses distributed ledger technology (DLT) to transfer value across borders and subsequently converts cryptocurrencies into fiat currency.
4. Ripple (XRP)
Ripple (XRP) is a well-known digital payment platform that also hosts cryptocurrency. It’s also one of the most common cryptocurrencies and uses a consensus mechanism that is different from the traditional proof-of-work (PoW) mining process of Bitcoin.
5. Uniswap (UNI)
The first decentralized exchange (DEX) is Uniswap, which runs on the Ethereum blockchain. As a result, Uniswap employs the ERC-20 algorithm, which is built into its platform. Sushiswap (also on Ethereum) and PancakeSwap are two copycat rivals in the field, thanks to their open-source nature (on the Binance Smart Chain).
Where Can I Buy Altcoins?
Traders can now buy, hold, and sell altcoins on a variety of platforms. Each of these platforms, however, has its own set of privacy policies and features. As a result, the best cryptocurrency exchange is determined by several variables, including buyer preferences.
Many users, however, have lost money as a result of frauds and flaws that have been exploited on various exchange platforms. As a result, it is the responsibility of each investor to trade on a trustworthy exchange.
If an investor wants to trade privately with another investor through direct transactions, they should make the effort to find trustworthy traders. Before investing cash, one of the greatest methods to safeguard one’s assets is to undertake extensive research on each platform and trader.
You can buy altcoins from reputable exchanges like Coinbase, Binance, KuCoin, eToro, or Crypto.com instead of lesser-known platforms.
Users should shop around before purchasing to study the allowed exchanges in their jurisdictions and verify the exchange markets to ensure that they have access to the cryptocurrencies they want.
READ ALSO: How to Buy Coinbase Stock in 2022
How To Buy Altcoins
The method for buying cryptocurrencies on different sites may change somewhat, but the stages are largely comparable and quite basic.
While exchanges are safe for beginners and help users avoid fraud, advanced traders may prefer to buy altcoins directly from owners.
Many altcoins may be purchased in only a few steps after acquiring bitcoin. We recommend buying Bitcoin (BTC) and trading it for the altcoin of your choice in this article. On one of the exchanges, many, if not all, altcoins should be paired with BTC.
You do not, however, have to buy cryptos through exchanges. Cryptocurrencies can be bought directly from another owner or over-the-counter. To protect themselves from fraud, we recommend that beginners use exchanges.
Here’s a step by step process of buying Altcoins:
Step 1: Set aside a percentage of your portfolio for the investment
Many other teams have released their currencies and subsequently vanished after dumping their allotted quantities on the market, while most altcoins are still in the experimental phase (also known as a rug pull). As a result, a large number of blockchain ventures fail soon.
Purchasing altcoins is a high-risk investment, with a high likelihood of the coin collapsing. As a result, separating a portfolio into multiple risk layers is a good idea, especially for investors interested in lesser-known cryptocurrencies.
Step 2: Do some research to find the most potential coins
For investors, there are thousands of cryptocurrencies to choose from. The suitability of one for investment is determined by several criteria, including the investor’s requirements and preferences.
As a result, every user should become more knowledgeable about cryptocurrencies associated with their preferred projects. They should also consider their various characteristics and choose the coins that appeal to them the most.
Step 3: Convert fiat money to cryptocurrency
Most exchanges do not enable U.S. dollar purchases since they are not fiat on-ramp platforms. As a result, investors must first purchase supported cryptocurrencies before exchanging them for altcoins on the exchange.
Several exchanges enable you to buy cryptocurrencies directly with a credit card, making it simple to get coins for an altcoin exchange.
Litecoin is one of the most popular cryptocurrencies in the world and is even referred to by some as silver to Bitcoin’s gold. See How to buy Litecoin with a Credit Card in 2022 | Easy Guide
Step 4: Select the appropriate exchange
Investors will need to define the exchanges that offer their preferred altcoin once they have a bag of cryptocurrencies ready to trade. Because popular exchanges have high liquidity and fewer fraud cases, new buyers are safer transacting on them.
As a result, it’s critical to locate various cryptocurrency exchanges that provide a favorable trading pair. Users can start trading their coins after they’ve found the trading pair they desire. However, before making a deal, there are a few things to think about:
- Is the exchange trustworthy?
- Is there any evidence of hacking or bug vulnerabilities on the platform in the past?
- What are their rates in comparison to those of their competitors?
You may want to see: 10 Best Alternatives To Coinbase
Step 5: Select a currency pair to trade
The next stage is to link a Web 3.0 wallet to the exchange, which will store the cryptocurrencies. Before executing the trade, the user should take note of the currency pair’s patterns and performance over the previous month or a few weeks to determine that the transaction is executed at the optimal moment.
Step 6: Put the transaction into action
It’s time to initiate if the conditions appear good and the user is prepared to make the deal. If you’re new to trading, spend some time researching how orders operate before placing an order on the exchange for the cryptocurrency you want.
Step 7: Verify that the altcoins have been added to the wallet
The bitcoin will already be in the wallet when the deal is completed. When an exchange is centralized, the only time a user needs to move funds from the exchange to their wallet is when the exchange is centralized. Unless funds are supplied for liquidity pools, yield farming, or any other Defi mechanism, monies are not held by DEXs.
Cold (sometimes known as “hard” since they’re hardware) and hot wallets are the two types of crypto wallets. Cold wallets, like Trezor and Ledger, are USB-like devices that hold a user’s private keys, making it impossible for hackers to manage a user’s cash unless they also have physical access to the hard wallet.
Hot wallets, on the other hand, are linked and hosted online, whether through a phone app (Trust wallet, for example), a desktop program (Daedalus), or a web app (Metamask). Hot wallets are more susceptible in terms of security, but consumers benefit from the reduced security.
Frequently asked questions On how To Buy Altcoins
You can buy Altcoins on eToro, Capital.com, Binance, Coinbase, Gemini, Bittrex
Some altcoins are easier to get than others. They are listed on numerous exchanges and are easy to acquire. For example, Litecoin (LTC) is listed on at least 150 trading platforms. Ripple (XRP) is listed on more than 110 exchanges.
In 2021, there is only one reliable platform that will let you buy crypto anonymously without KYC and that is LocalCryptos. LocalCryptos are NOT related to LocalBitcoins.
SimpleFX is one of the best crypto exchanges without KYC as they use advanced technology, have massive spreads, and transparent conditions. With this platform, you will be able to trade with numerous different altcoins, forex, indices, CFD crypto, and BTC without any verification only if you deposit using BTC
Although altcoins often increase in lockstep, unsuccessful ventures will inevitably sink. And most new initiatives have a short lifespan. Solid cryptocurrency projects like Ethereum, Polkadot, Cardano, and Polygon, on the other hand, have endured the test of time and deserve deeper investor attention.
Also, keep in mind that altcoin values are still tied to BTC, so whether BTC rises or falls, altcoins tend to follow suit (after ETH). However, people should be cautious when choosing an altcoin to invest in.
- cryptopro.app – How to Buy Altcoins | Beginner’s Guide
- cryptonews.com – How To Buy Altcoins
- cointelegraph.com – Altcoin exchange 101: A comprehensive guide on how to buy and sell altcoins