Altcoins is a term that refers to cryptocurrencies other than Bitcoin. The name stands for alternative coins. The crypto market initially only had Bitcoin. But as developers began brainstorming ways to improve Bitcoin or create new ones, new digital assets arose.

This article serves as a general guide to altcoins. You’ll find out what altcoins are, how they work, and how to invest in them using Shrimpy. By the end of this article you should understand whether you want to invest in Bitcoin or altcoins.

What are Altcoins?

Altcoins are cryptocurrencies created after Bitcoin that either intend to replace Bitcoin or tackle a use case that Bitcoin does not intend to fill. Many altcoins have spawned from existing projects. This process is called forking and refers to generating a new blockchain based on an existing blockchain network and its transaction history.

The first altcoin was a Bitcoin fork called Litecoin. The creators of Litecoin developed the project to deliver lightning fast payments for miniscule transaction sizes. And following Litecoin’s creation, other altcoins were made.

Ethereum represents one of the most popular altcoins. Some investors don’t even consider Ethereum to be an altcoin due to its massive market share. However, even if the project surpassed Bitcoin in market capitalization, it would still be – by definition – an altcoin.

Investors consider altcoins ample investing opportunities due to their small size. It is much easier to move the price of a random altcoin than to increase Bitcoin’s price. Therefore, investors can expect higher returns from altcoins compared to Bitcoin.

How do you discover new altcoins?

There are more than 4,000 altcoins in 2022. In fact, the real number is much higher due to the fact that practically anyone can create and list an altcoin nowadays. The advance of DeFi has made it possible for us to trade cryptocurrencies on unregulated decentralized exchanges which have no listing requirements or rules. This led to the high growth of altcoin projects.

You can discover altcoins by visiting popular crypto market statistics websites such as CoinMarketCap and Coingecko. These websites show all cryptocurrencies that exist on the market today. The only requirement to be listed on these pages is to have at least one trading pair on a centralized or decentralized exchange.

You can browse altcoins by browsing the cryptocurrency leaderboard. There, you can order crypto assets by market cap, price, and volume. Both Coingecko and CoinMarketCap allow you to browse cryptocurrencies by categories. For example, you can browse assets that are part of Ethereum’s or Solana’s ecosystem.

You can also discover altcoins by scrolling through crypto communities. The largest crypto communities are located on Twitter, Reddit, and Discord. You can connect with crypto investors or find crypto-related subreddits and read about the newest and hottest projects.

Should you invest in Bitcoin or Altcoins?

Choosing between investing in Bitcoin or altcoins boils down to your personal risk preferences. Altcoins obviously warrant higher returns, however, they also carry higher risk. An altcoin might rug – meaning that its developers abandon the project and steal funds – or lose steam. It can also be overshadowed by a competitor that targets the same use case.

On the other hand, Bitcoin is a far more stable and reputable cryptocurrency. It is also far more decentralized than any other project out there – mainly due to the fact that Satoshi Nakamoto does not actively develop the network anymore. Bitcoin is, per some investors, a safe bet due to its size, tokenomics, and huge community.

Click here to read our altcoin reviews

Some investors invest in altcoins in order to replicate the results that early Bitcoin adopters had. They buy an altcoin with a sound roadmap believing that it will reach a high-enough adoption rate and network value to skyrocket in price. And some have made millions by being early adopters of tokens such as ETH, BNB, SOL, etc.

Trading Altcoins on Shrimpy

Shrimpy is an automated portfolio management platform that facilitates cryptocurrency investing. With Shrimpy, you can connect all your exchange accounts and manage your portfolios from one place. You can rebalance your portfolio, dollar-cost-average, execute portfolio stop losses, and more.

You can browse altcoins on Shrimpy by heading to the Trading tab. The trading tab lets you explore all the popular crypto assets. You can filter the assets by price, price increase, market cap, and volume. You can also find specific assets by using the search toolbar.

The default sorting order is set by rank. The rank is predetermined by an asset’s market capitalization, which is calculated by multiplying the price and circulating supply.

By clicking the name of an asset you’ll head to its asset page. There, you can find more information about the asset and its relation in regards to your portfolio. You can view your position value and track the asset’s price.

Shrimpy also lets you buy or sell the asset through this page. A simple trading interface enables you to swap one token for another. This process is called token swapping and resembles what you might find on a decentralized exchange such as Uniswap.

Shrimpy lets you swap any asset for any asset and calculates the exchange rate you’ll have. Our platform uses smart order routing to determine the best liquidity path for buying or selling your asset. And after executing the trade, you’ll find your new assets in your Shrimpy portfolio.

If you want to learn more about altcoins and crypto investing, I recommend reading the following articles:

• How To Use a Crypto Trading Terminal
• Crypto Trading: How to Keep Yourself Accountable
• How to Build a Custom Crypto Index Fund