Altcoins

What are altcoins?

Alternative coins also known as 'alt coins' are simply every other coin in the cryptocurrency market except bitcoin; as you can see bitcoin is the predominant coin in the cryptocurrency market, this is where the crypto space began essentially.

So all the other coins that started getting created after bitcoin are now known as 'alt coins', the main leader of altcoins is etherium. Every altcoin as long as it is a good project and has good utility are unique in their own way, there are multiple categorys for altcoins as they all do different things and are trying to improve certain segments of the already financial world, to change it into anewer one, as discussed previously in one of our other documents this is the blockchain technology; which is like the internet 2.0.

There are thousands of different altcoins and it can be hard to know which one to invest in to, asthere are so many different sectors altcoins actually cover.

Some of the maincharacters you want to be looking in to are;

• Smart contracts platforms - Protocols intended to digitally facilitate, verify, or enforce the negotiation or performance of a contract.

• NFTs - on-fungible tokens (NFTs) are unique, digital items with blockchain-managed ownership.

• Yield farming - Yield farming is the staking or lending of crypto assets in order to generate returns or rewards in the form of more cryptocurrency.

• Leveraged tokens - Leveraged tokens are assets that can give you leveraged exposure to cryptocurrency markets, without all the need for managing a leveraged     position using margin.

• Privacy coins - Coins that encrypt their transactions using zero-knowledge proofs or similar private technology.

• Pow (proof of work) coins - Mineable coins using the proof of work (PoW) consensus algorithm to generate new blocks on the blockchain.

• Pos (proof of stake) coins - coins that generate new blocks through proof of stake (PoS), which means the rate of validation of transactions on the blockchain occurs according to how many coins a person holds.

• Dpos (delegated proof of stake) coins - Delegated proof of stake (DPoS) is a verification and consensus mechanism in the blockchain.

• Cefi and defi - cefi and defi is Centralised and decentralised finance.

• DEX (decentralised exchange) tokens - Decentralized exchanges (DEX) are a type of cryptocurrency exchange which allows for direct peer-to-peer cryptocurrency transactions to take place online securely and without the need for an intermediary.

• CEX (centralised exchange) tokens - Centralized exchanges (CEXs) are a type of cryptocurrency exchange that is operated by a company that owns it as a     centralized entity.

• Oracle coins - An oracle is a way for a blockchain or smart contract to interact with external data.

• AMM (automated market makers) coins - Automated Market Makers (AMMs) are a class of decentralized exchanges that allow digital assets to be traded     without permission and automatically by using liquidity pools instead of a traditional market of buyers and sellers.

• Interoperability coins  - Blockchains working on facilitating interoperability between one another.

• Masternode coins - Coins that support masternodes, nodes that store full copies of the blockchain, validate transactions, and perform other important tasks.

• Stablecoins - Stablecoins are assets that have price stability characteristics that make it suitable for short-term and medium-term use as a unit of account and store of value, often pegged to a national currency.

• Storage coins - Tokens that provide an economic incentive to distributed cloud storage networks.

• The next one isnt really a category but it has its own unique utility, this is xrp (ripple), I will be doing a write up on xrp in its own document as its very different from the other altcoins and the utility its trying to     provide. XRP is the native     cryptocurrency for products developed by Ripple Labs. Its products are used for payment settlement, asset exchange, and remittance systems     that work more like SWIFT, a service for international money and security transfers used by a network of banks and financial intermediaries

By understanding these different categories that altcoins can be divided in to we can then understand the utility behind the particular token and what its actually trying to do. We also need to know that when a token comes under a particular category there might be other features in that particular asset that will do more than just one singular thing. They can be have features which puts them into twocategories, for example sushi-swap is a dex (decentralised finance exchange)token, and it also provides yield farming so it will be under both categories.

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