DEFINITION of 'Altcoin'

Altcoins are the alternative cryptocurrencies launched after the success of Bitcoin. Generally, they project themselves as better substitutes to Bitcoin. The success of Bitcoin as the first peer-to-peer digital currency paved the way for many to follow. Many altcoins are trying to target any perceived limitations that Bitcoin has and come up with newer versions with competitive advantages. There is a great variety of altcoins.

BREAKING DOWN 'Altcoin'

"Altcoin" is a combination of two words: "alt" and "coin"; alt is short for alternative and coin signifies currency. Thus together they imply a category of cryptocurrency that is alternative to the digital currency Bitcoin. After the success story of Bitcoin, many other peer-to-peer digital currencies have emerged in an attempt to imitate that success.

Many of the altcoins are built up on the basic framework provided by Bitcoins. Thus most altcoins are peer-to-peer, involve a mining process and offer efficient and cheap ways to carry out transactions on the web. But even with many overlapping features, altcoins vary widely from each other. 

Even with many close competitors, Bitcoin is still leading the virtual currency pack. Newer and more innovative versions are getting launched that offer modifications in areas like transaction speed, privacy, proof-of-stake, DNS resolution and more. A few of them have gained popularity; the rest are lesser-known. Examples of altcoin include Litecoin, Dogecoin, Peercoin, Feathercoin, Zetacoin, Novacoin, etc. Litecoin is seen as the closest competitor to Bitcoin. 

RELATED TERMS
  1. Bitcoin

    A digital or virtual currency that uses peer-to-peer technology ...
  2. Trade Hill Exchange

    A Bitcoin exchange launched in June of 2011. Trade Hill Exchange ...
  3. Mt. Gox

    One of the world's leading Bitcoin exchanges, launched in July ...
  4. Litecoin

    Launched in the year 2011, Litecoin is an alternative cryptocurrency ...
  5. Bitomat

    A Polish-based bitcoin exchange. Bitomat was the first Bitcoin ...
  6. Cryptocurrency

    A digital or virtual currency that uses cryptography for security. ...
Related Articles
  1. Small Business

    Countries Where Bitcoin Is Legal & Illegal (DISH, OTSK)

    Although bitcoin has been in existence for five years, most countries still do not have consistent laws regulating the cryptocurrency. However, a few countries have banned bitcoin altogether.
  2. Small Business

    Analyzing Bitcoin in 2016

    Discover the market dynamics behind bitcoin's latest price recovery in late 2015 and why its underlying value is expected to remain strong in 2016.
  3. Small Business

    How Bitcoin Can Change The World

    Bitcoin has the potential to not only create savings for consumer, but also to transform global transactions.
  4. Investing

    The Bitcoin Halving: Why It Matters, What to Expect

    The halving is coming.
  5. Taxes

    Are There Taxes On Bitcoins?

    Here is a short guide to the tax implications when using or investing in bitcoins in the US.
  6. Small Business

    The Rise And Fall And Rise Of Bitcoin

    A look at the reasons behind the recent spectacular surge in bitcoin prices.
  7. Small Business

    If You Had Purchased $100 of Bitcoins in 2011

    Learn how an investment of $100 in bitcoin in 2011 would have performed over the years, and find out what your purchasing power would have been for each year.
  8. Small Business

    Ways To Earn Bitcoins

    There are many ways to earn and own Bitcoins other than just buying them on a Bitcoin exchange.
  9. Financial Advisor

    Bitcoin Vs. Litecoin Vs. Dogecoin: Comparing Virtual Currencies

    Read about several of the world's most widely used cryptocurrencies, and learn more about how they function and perform in the marketplace.
  10. Small Business

    How To Trade Forex With Bitcoin (XOM, EXPE)

    We look at ways to trade forex with bitcoin and the pitfalls in doing so.
RELATED FAQS
  1. How do you buy Bitcoins?

    Many people have heard of this virtual cryptocurrency, but few know all the ways you can purchase Bitcoin. Read Answer >>
  2. What are the risks of investing in Bitcoin?

    Learn how Bitcoin is an unregulated, uninsured and unregistered private digital currency that can be used as a speculative ... Read Answer >>
  3. What are the advantages of paying with Bitcoin?

    Learn how payments made with Bitcoins offer certain advantages over standard currency, including user anonymity, no taxation ... Read Answer >>
  4. Why do Bitcoins have value?

    Performing with transactional anonymity, Bitcoin has value as a private digital currency, investment tool and social networking ... Read Answer >>
  5. Is Bitcoin legal in the US?

    Learn about the legality of Bitcoin as a form of payment in the United States, as well as how it is produced and concerns ... Read Answer >>
  6. What does a block chain record in a bitcoin exchange transaction?

    Read about the bitcoin blockchain, a public ledger shared among all bitcoin users that records the information of every single ... Read Answer >>
Hot Definitions
  1. Federal Direct Loan Program

    A program that provides low-interest loans to postsecondary students and their parents. The William D. Ford Federal Direct ...
  2. Cash Flow

    The net amount of cash and cash-equivalents moving into and out of a business. Positive cash flow indicates that a company's ...
  3. PLUS Loan

    A low-cost student loan offered to parents of students currently enrolled in post-secondary education. With a PLUS Loan, ...
  4. Graduate Record Examination - GRE

    A standardized exam used to measure one's aptitude for abstract thinking in the areas of analytical writing, mathematics ...
  5. Graduate Management Admission Test - GMAT

    A standardized test intended to measure a test taker's aptitude in mathematics and the English language. The GMAT is most ...
  6. Magna Cum Laude

    An academic level of distinction used by educational institutions to signify an academic degree which was received "with ...
Trading Center