Beyond Bitcoin - Should You Invest In Altcoins?
Size is one of the most common parameters for measuring growth. And today, the progress in the cryptocurrency industry will surely surprise you. We can describe the development of the crypto sector in terms of the number of coins available so far and the total market volume.
Since the discovery of electronic money, up to 4400 different cryptocurrencies have been developed. But that's not all because the total market share of the sector is nearing 3 trillion dollars. Bitcoin was a countermeasure to financial emergencies such as the 2008 great recession. But despite its roots, Bitcoin has grown to become the most prominent cryptocurrency.
The Bitcoin network is among the most sophisticated in the digital space today. Its underlying blockchain technology is remarkably secure. Moreover, the Bitcoin-based blockchain will receive additional capabilities to support more applications. Things like decentralized finance will be fine once the Bitcoin community shall have launched the Taproot project. The increasingly integrated financial markets make it possible to put Bitcoin and other cryptos to more practical uses beyond facilitating transactions.
This question runs across the minds of cryptocurrency enthusiasts, including yourself. To understand this, let's remind ourselves about traditional money. Fiat currencies have value because most have or still have gold backing.
COPYRIGHT_WI: Published on https://washingtonindependent.com/beyond-bitcoin-should-you-invest-in-altcoins/ by Camilo Wood on 2022-12-08T14:09:20.538Z
So the valuable metals in the background gave conventional money its value. Also, fiat money has value because all people believe in it. And this is mainly due to government regulations, which have ensured high integrity and safety standards.
On the other hand, Bitcoin is an autonomous technology whose operations are independent of government policies. Bitcoin is valuable because of its limited availability. And like traditional money, Bitcoin derives some of its value from people's belief in it. Notably, Bitcoin has value due to its constantly changing prices. While a negative aspect, price volatility makes trading on cryptocurrency exchanges like the Bitcoin Pro possible.
The first reason you're seeking more information about Bitcoin and Altcoins is that Bitcoin boasts the largest market share. Besides, Bitcoin has the highest price per coin. One BTC has held the value the thousands of dollars for several years. The other critical winning aspect of Bitcoin is its solid reputation. Yes! This cryptocurrency experienced many challenges initially, but stakeholders have solved most of them.
Altcoins are Bitcoin investment alternatives. And as we've mentioned at the beginning, there are at least 4400 alternative coins in the cryptocurrency market. However, not all of them can be a perfect investment option. Only two of Bitcoin's closest rivals Litecoin and Ethereum are worth mentioning in comparison. So even though all cryptocurrency assets are incredibly volatile in price and market performance, the Altcoins are vastly less stable than Bitcoin. The most considerable assets, like Bitcoin, have the most significant influence in any market.
You can meet your investment goals with Altcoins. However, you'll have to play your cards extremely professionally to widen your fishing nets. Altcoins like Litecoin and Ethereum have the advantage of requiring relatively lower initial capital because of their lower prices per coin. So even if your investment were to go wrong, there'd be fewer assets to lose than with Bitcoin. But remember that the markets rely on the most successful acquisitions. So if things aren't working with Bitcoin, chances are higher the trend might be the same with Altcoins.
Altcoins is a collective term for all other cryptocurrencies that aren't associated with Bitcoin. Most of them are projects that failed. The ones that saw the light and exist have a significantly lower value. Therefore, most analyses usually capture only the two most successful Altcoins; Litecoin and Ethereum. Altcoins generally require less cash for investment due to their relatively lower values.
So you can get started with an Altcoin more seamlessly than with Bitcoin. However, the performance of Altcoins is always more unpredictable than Bitcoin's. Importantly, if things aren't working out for you with Bitcoin, you'll most likely experience the same problem with any of the Altcoins.