– Bitcoin was the first digital currency and has gained popularity with stability and reliability
– Bitcoin is an innovation in the financial market
– Bitcoin’s monetary policy is the safest and most reliable in the industry
– Bitcoin is continually improving its safety policies
The success of Bitcoin has triggered the launch of many cryptocurrencies, which established their reputation on the market and became known as altcoins. Some tried to recreate or extend Bitcoin’s properties and innovation in developing altcoins, but not all managed to attract investors.
Some alternative coins seem to threaten Bitcoin in a couple of ways; even if the first digital currency launched on the market has a series of properties, no altcoin can copy. These characteristics include reliability, recognizability, Lindy effects, and network effects.
Undoubtedly, Bitcoin dominates the market, but many of the competing digital assets available in the market offer features and functionalities that serve investors well. Not all digital tokens are created equal, and an investor needs to research and educate themselves before investing in one.
Together with Bitcoin, some altcoins had meteoric rises, and it’s worth discussing about them.
What are altcoins?
You probably figured out that altcoins are alternative digital currencies to Bitcoin that use it as a benchmark because it’s the cryptocurrency that has dominated the market for the last couple of years. Considering that it’s the first-ever cryptocurrency, it sets a model for how the other projects should perform.
Altcoins, similarly to Bitcoin, rely on blockchain technology to operate, and they vary in operation, features, and goals. There are thousands of alternative coins, but the most popular ones are: Ethereum, Litecoin, Ripple, Solana, Cardano, Dogecoin, and Shiba Inu Coin.
Altcoin developers aim to create digital tokens different from Bitcoin that bring the features the primordial ecosystem lacks on the market. Let’s discuss a little about Ethereum, the most well-known altcoin. It’s a system that enables people to send digital currencies to one another. It was developed to serve in application development because it enables the creation of new coins on the network.
Cardano, another popular altcoin, enables peer-to-peer transactions and also allows developers to create applications on the network. However, it has a drawback; it requires a research-intense approach if you want to build outside the network.
Litecoin also has unique features. Let’s start with the fact that it has a larger supply than Bitcoin and enables faster transactions. Litecoin was developed with the purpose of providing an alternative to silver (Bitcoin was developed as an alternative to gold).
There are numerous altcoins available on the crypto market, but few can compete with Bitcoin. Crypto specialists believe altcoin projects aim to provide alternative use cases to big tech companies and the traditional financial system.
What makes Bitcoin different from altcoins?
Bitcoin has always had the first-mover advantage, transforming it into the most successful digital currency. A look at Bitcoin price shows that it attracts developers and has built an enthusiastic and diverse community over the years. Its network consists of thousands of nodes spread worldwide, making it the largest digital currency by hash rate, volume, and market capitalisation. The industry dominance acts like a recognisable brand for Bitcoin, enabling it to stand apart from altcoins. Bitcoin allows users to verify their assets with certainty. Because there is no copyright regulation or enforcement, no one can create counterfeit tokens, which protects investors from purchasing knock-off Bitcoin.
We can easily see that Bitcoin has better investing fundamentals than alternative coins, which makes it the most traded, held, and purchased digital currency on the market. It has over 60% of the total market cap of digital currencies, and its daily trading volume exceeds $30 billion (it’s a highly liquid asset).
There’s a chance they’ll fade away when it comes to altcoins if they don’t have a strong practical case. Most alternative currencies were developed for experimentation purposes and had trouble catching up with the first coin. Even in the current bear market, Bitcoin’s demand and popularity are rising.
Experts often debate on how to view Bitcoin as a worthy investment to add to one’s portfolio, but let’s remember that it was developed for future utility. For many investors, Bitcoin is an asset that enables them to store wealth, considering its increasing adoption as a payment solution. And let’s note that there’s a growing demand for it among organisations and individuals, which triggers increased adoption and credibility in the long run.
Bitcoin is a reliable cryptocurrency
No other currency has the same uptime as Bitcoin, which has remained accessible and active on the market since its launch in 2013, suffering no interruption. Not even well-known organisations like Facebook, Google, or Microsoft match this level of reliability. It withstood attempted bans from governmental organisations, external attacks, internal disputes, and many other challenges. Yes, it has experienced massive price ups and downs, but its volatility decreased over time. No other currency has the same level of experience in the industry, as it survived multiple crypto winters. Bitcoin overcame all obstacles it faced along the way and encouraged investors to trust its evolution.
With over a decade of existence, it’s one of the most resilient cryptocurrencies on the market. When it was first launched on the market, it had a single point of failure, a central leader. But Satoshi Nakamoto, its anonymous creator, yielded the control of the project to a decentralised group of crypto developers who exploited the trend of decentralisation and transformed Bitcoin into a network made of tens of thousands of nodes. No government or authority can shut down bitcoin.
Alternative coins create inflation for Bitcoin because they serve different purposes and are different assets. Bitcoin is not fungible as other digital currencies and is unique in the crypto market. Alternative coins can launch and inflate their supply, but no extra coins can be introduced to the Bitcoin supply, and there will be only 21 billion tokens. However, Bitcoin and altcoins’ evolutions are closely connected; when one goes up, all the others also do it.
Nikhil Kore, the techy writer, is an expert in conveying complex concepts with clarity. His innovative words captivate readers, leaving them inspired and knowledgeable. Nikhil’s distinct voice and expertise make him a trusted source in the tech industry.