Key Takeaways:
Altcoins encompass cryptocurrencies that are not Bitcoin.
Altcoins are considered an important part of diversifying your crypto portfolio.
You can buy altcoins on Binance in two simple steps while enjoying low fees.
Want to explore crypto that isn’t Bitcoin? Discover the top 10 hottest altcoins and how you can buy them on Binance.
Whether it’s the rise of Dogecoin’s price or Etheremum’s latest update, the top altcoins per market capitalization have been gaining more traction within the crypto space.
Keep reading to see how you can use altcoins to diversify your investment portfolio.
What are Altcoins
Basically, altcoins are cryptocurrencies that are not Bitcoin.
There are a large amount of altcoins available, and they all have different utilities. For example, metaverse tokens are used to facilitate payments in the metaverse and fiat-backed stablecoins can be used to cope with market volatility.
If you’re interested in participating in a DAO’s growth, you can purchase its native DAO token to help shape its future. Want to get involved in the exciting shift to Web 3.0? Learning about NFT coins and Web 3.0 tokens is a great starting point.
Bitcoin vs Altcoins: What Are The Differences?
Although Bitcoin shares some similarities with a variety of altcoins, there are often some fundamental differences you should be aware of.
1. Consensus Mechanism
Bitcoin uses a peer-to-peer consensus mechanism to power a network to collectively verify transactions, adding them to the block. However, this can be energy-intensive and limiting.
On the other hand, some altcoins use a different consensus mechanism to produce blocks or validate transactions. Making the process less energy exhaustive, reducing the time and resources needed to validate transactions.
Some altcoins have also improved overall functionality and scalability by using new mechanisms to reduce the cost and complexity of mining.
2. Utility
Many altcoins are not just cryptocurrencies. For example, Ethereum is one of the first to implement the idea of smart contracts, a code that can execute agreements between two parties using blockchain technology.
Another example is MANA from the Decentraland project. Users can use MANA to buy plots of digital real estate called LAND, and can even monetize their digital property by renting them to other users.
Functions like these give users the opportunity to develop new use cases and applications for crypto technology.
3. Innovation
Altcoins offer solutions to the limitations of Bitcoin. Ethereum, for example, allows for multiple functionalities in the blockchain infrastructure, such as automation and broader interaction within the network. In addition, Solana was created to provide a more scalable and secure software at a lower cost compared to Bitcoin and Ethereum.
What is An Altcoin Season And When Does It Happen?
An altcoin season is a period of time when other tokens and coins are outperforming Bitcoin.
An altcoin season cannot be determined by looking at the price of altcoins or Bitcoin in isolation. There are indicators that traders and investors can use to spot an upcoming altcoin season:
New trends
An emerging trend that creates demand for new altcoins could potentially overpower Bitcoin's dominance.
Large market cap altcoins start to increase in price
A price surge in popular altcoins like Ethereum (ETH) and BNB (BNB) could indicate that those profits may also flow to other altcoins.
Bitcoin Continues to Thrive, Carrying Altcoins Along
Bitcoin trades at $44,856 at the time of writing. With a current market capitalization of more than $822.01 billion, Bitcoin (BTC) could theoretically take a prominent position on the New York Stock Exchange, between Facebook with a market capitalization of $642.84 billion and Tesla with a market capitalization of $1.080 trillion.
On top of signifying more awareness, adoption and trust in crypto, the growth of Bitcoin has also also helped to shine a light on altcoins. This could potentially suggest that the growth of Bitcoin has the potential to positively impact other tokens and coins.
Top 10 Altcoins on Binance by Market Capitalization
Altcoins can provide great diversity to your investment portfolio. Here are 10 with the highest market cap.
BNB (BNB) at a price of $441.60 and at a market cap of $72,932.07M*
Ethereum (ETH) at a price of $3,354.12 and at a market cap of $403,566.77M*
Cardano (ADA) at a price of $1.15 and at a market cap of $38,815.44M*
Dogecoin (DOGE) at a price of $0.16 and at a market cap of $21,466.12M*
Solana (SOL) at a price of $125.43 and at a market cap of $40,849.58M*
Polkadot (DOT) at a price of $21.52 and at a market cap of $21,252.70M*
Uniswap (UNI) at a price of $10.96 and at a market cap of $7,557.59M*
ChainLink (LINK) at a price of $16.58 and at a market cap of $7,747.68M*
Decentraland (MANA) at a price of $2.49 and at a market cap of $4,583.58M*
Aave (AAVE) at a price of $215.70 and at a market cap of $2,949.95M*
* As of April 6th, 2022.
* This list does not constitute a recommendation or endorsem*nt by Binance to buy or sell any currency.
How to Buy Altcoins on Binance
If you’re interested in buying one of the cryptocurrencies listed above, Binance offers a range of payment options for smooth and easy transactions. On Binance, you can buy altcoins and other crypto in two simple steps while enjoying lower fees:
Step 1: Make a fiat deposit via an e-wallet transfer or bank transfer on Binance. Makesure to check the available fiat channels for desired currencies. For more information, see our in-depth guide on “How to Deposit USD via SWIFT”.
Optional: Convert the fiat currencies to BUSD or USDT so that you can trade a greater variety of tokens.
Step 2: Purchase your preferred altcoins through a user wallet purchase or directly with credit/debit card.
Conclusion
The rise of altcoins and their respective blockchain networks is a good sign for the crypto space. As more projects and users enter the world of crypto, altcoins will continue to grow in terms of use cases and liquidity.
And as always, remember to DYOR before purchasing and committing to any altcoins.
Ready to buy cryptocurrencies?
Sign up for a Binance account or download the Binance app. Once your account is verified, you can buy cryptocurrencies on Binance using fiat in three ways: from Binance via bank transfer, card channels or e-wallets options.
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Disclaimer: Cryptocurrency investment is subject to high market risk. Binance is not responsible for any of your trading losses. The opinions and statements made in this article should not be considered financial advice and are shown to illustrate an example, and is not intended to serve as investment advice or recommendation.
Read the following articles for more information:
(Support) How to Buy Crypto with Debit/Credit Card on the Website and the App
(Blog)
(Blog) Metaverse Tokens: What, Why and How To Buy Them
(Blog) Web 3.0 Coin: The Newest Crypto Trend in 2022
(Blog) DAO Crypto Tokens: What, Why And How To Buy
(Academy) 9 Altcoins To Diversify Your Portfolio
