Altcoin is the combination of “alt” and “coin”; here the full form of alt is alternative. These words indicate a category of cryptocurrency that is alternative to the Bitcoin.
Bitcoin was the first cryptocurrency that was introduced in 2009. The code of the bitcoin is the fully open source. Everyone can utilize the code and can make improvements in cryptocurrencies.
Altcoins are developed by diverging from Bitcoin consensus rules or by developing a new cryptocurrency from scratch.
Most popular altcoins use the same fundamental building blocks as Bitcoin. This approach is relatively easy to carry out because Bitcoin is a free, open-source platform.
When an altcoin forks at the blockchain level, an alternate system of consensus rules must be used and the coin will have an entirely different distributed ledger. The same is true for altcoins built from scratch.
The first Altcoin was Namecoin and it was created in April 2011. The primary purpose of this project is to register to decentralize domain-names. Namecoin has remained one of the most successful altcoins throughout its short lifespan. The Namecoin is listed on 267 positions on Coinmarketcap.
Some altcoins have different regulatory policy rules built into the currency to encourage different uses and treatment. Policies such as minimum spend, or positive or negative interest on coins stored, can encourage or discourage hoarding. Policies for coin mining may function differently from Bitcoin, as may the number of coins paid out per new block mined.
Altcoins are also helped in discouraging the ASIC or GPU mining. This limitation is designed to reduce the advantage of specialized coin miners, as in the case of Litecoin, upon which half of all altcoins are based.
An altcoin blockchain may also store different metadata about the coin’s preceding transactions or may let the coin to be repurposed as an alternative asset.
While some altcoins can try to enrich the founders and offer new things, many have found niches because their differences have encouraged new miners and uses. Since the beginning of Bitcoin, more than 500 altcoins have been created.
Litecoin, Dogecoin, Blackcoin, Freicoin, Peercoin, Vericoin, Myriad, NXT are just a few examples of altcoins. Decentralization is one of the most prominent goals of Bitcoin, and the altcoin has further dispersed the cryptocurrency community.
In addition, the altcoin allows developers to try out unique features. While Bitcoin does replicate these features, a full-featured altcoin is better than the Bitcoin test network “Cryptographic Money Lab” if the developer or community needs it.
Finally, Altcoins brings healthy competition to Bitcoin. Altcoins offers an alternative to cryptocurrency users and forces Bitcoin developers to stay active and continue to innovate.
Altcoins are decentralizing the cryptocurrency community. Decentralization is one of Bitcoin’s most important goals. Furthermore, altcoins let the developers experiment with unique features.
Is OneCoin an AltCoin
The simple answer is no. OneCoin is based on a centralized system and it’s totally different from Bitcoin and other altcoins. OneCoin is not using the open source code of Bitcoin.
As we have mentioned above, altcoin is derived from the Bitcoin. They are totally based on the technology used by Bitcoin but OneCoin works with totally different technology.
The OneCoin has their own centralized blockchain. No one coin use the code of OneCoin as it’s not open source. The company is aiming to design a secure system by keeping the technology and code secret.
I hope this article will help you out in understanding what is altcoin. Share the article with the community around you to let them know about altcoins.
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