Bitcoin vs Altcoins

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Bitcoin vs. Altcoins: Which Will Make You More Money in 2020?

Now that market sentiment has changed and traders are feeling bullish, comes the age old question, Bitcoin or Altcoins? Let’s take a look at which investment strategy may have the bigger payoff.

Buy Bitcoin or take chances in the Altcoin Casino?

The bullish sentiment is back, and traders have been placing their allocations on their favorite blockchain projects. The question on most investor’s minds is which coin will have the biggest payoff? Is it Bitcoin, the largest coin by market cap, or smaller cap Altcoins?

Bitcoin is the most decentralized project, with the most users, and the best minds in computer science currently working on advancing the networks development. It has the largest network effect, the most supporting infrastructure built out around it, and the best trade-offs for self sovereignty. Perhaps most importantly for traders, Bitcoin also has the most liquidity, and is the most secure network, with the highest amount of POW hash rate to validate transactions.

Altcoins on the other hand are usually a lot more volatile and risky. They are not as secure, don’t have as much liquidity, and can often be attacked since they have a lower hash rate, or they are less secure consensus-wise like many PoS coins. Some altcoins have competent devs, others do not. Each altcoin should be looked at on a case by case basis and intimately studied by investors, before they go long.

Large cap altcoins like Bitcoin Cash or Ethereum do have a fair amount of infrastructure complementing the networks. For example DeFi is almost at a billion dollars investment on ETH. That being said, each of these projects built on top of an altcoin platform needs to be scrutinized individually, as there are usually tradeoffs.

Altcoins offer high volatility

Many altcoin traders like the added volatility of small cap altcoins because they offer a much larger profit if they do start to moon. Most altcoins rise when Bitcoin rises, sometimes by a lot more than BTC itself, but the same holds true if BTC starts to dump also.

During the 2020 bull run some traders became millionaires from a super small altcoin that suddenly received a bunch of interest because of a partnership, or new feature. Regardless, most altcoins lost over 90% of their value during the bear market and some projects died leaving investors holding a bag of worthless tokens.

Bitcoin has fallen in price dramatically and lost more than 80% of its price several times, but has also gone from $0.06 to its all-time high of $19,891, gains of 33,151,566.66%. It is very volatile, but due to its limited supply, and consensus rules, a very secure investment, with almost unlimited upside potential.

Altcoins should be viewed more as penny stocks. You may be able to pick out the next Google, Amazon or Tesla, but it isn’t very likely. It’s more likely to be dumb luck. Each Altcoin is very different from every other, and also very different from Bitcoin.

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If you plan to invest in Alts, please do your own research and be aware that disingenuous marketing sensationalizes almost every altcoin project. Altcoins, and the companies behind the projects are also vulnerable to regulation, Bitcoin is not.

Bitcoin is the far better investment for 2020. Not only is it seen as a safe haven asset, but it’s also the original cryptocurrency and continually leads blockchain development through it’s BIP process. Altcoins can make you more money than Bitcoin, it’s true, it’s just a lot riskier, and you could lose everything in an instant.

Altcoins or Bitcoin, where will you put your money this year? Add your thoughts below!

Bitcoin vs Altcoins: Where Should a New Crypto Trader Begin?

Bitcoinist | May 14, 2020 | 12:04

Bitcoin vs Altcoins: Where Should a New Crypto Trader Begin?

Bitcoinist | May 14, 2020 | 12:04

Diving down the crypto rabbit hole for the first time, traders are confronted with a choice: Buy bitcoin — the first and biggest cryptocurrency — or delve into the world of altcoins.

Bitcoin vs Altcoins

Whether you opt for the security and brand value of bitcoin or the allure of altcoins, that’s totally personal, and depends on your own risk tolerance and investing philosophy. To make deciding easier, most major exchanges like eToro offer a range of coins, allowing you to weigh up your convictions and then stack your portfolio according to your judgment.

More conservative traders are likely to buy bitcoin or one of its closest contenders — Ether, Bitcoin Cash, and XRP — that rival the leading cryptocurrency in terms of market capitalization.

Each of these cryptocurrencies has its own appeal: Ether, the cryptocurrency that transacts over Ethereum’s blockchain, boasts of powering smart contract development and is fueling the growing Decentralized Finance (DeFi) ecosystem; Bitcoin Cash , which forked from bitcoin in 2020, offers a big-block approach to scaling; and XRP, often referred to as “the banker’s coin”, has been instrumental in Ripple forging numerous partnerships with financial institutions.

Further down the totem pole, a range of smaller altcoins are available on eToro , and new ones are popping up all time. This includes coins like Tezos that are rapidly rising up in rankings.

Exploring the rabbit hole

Whether you choose to invest in bitcoin or altcoins, be aware of the risks. Bitcoin is famous for its stomach-churning price swings, and even these are dwarfed by the volatility of small-cap altcoins.

To navigate the market successfully and keep up with news and happenings, traders look to the community. From the eToro dashboard, traders can harness the wisdom of the crowd to build their own cryptocurrency portfolio, and then stay on the right side of the market by monitoring events via a newsfeed. So instead of weathering the storms of volatility alone, traders can share their portfolios and ride the swings together.

Or more passively, traders can even take advantage of eToro’s copytrader function to automatically mirror the actions of top performers.

Choosing between bitcoin and altcoins has never been easier!

Disclaimer: The information presented here does not constitute investment advice or an offer to invest. The statements, views, and opinions expressed in this article are solely those of the author/company and do not represent those of Bitcoinist. We strongly advise our readers to DYOR before investing in any cryptocurrency, blockchain project, or ICO, particularly those that guarantee profits. Furthermore, Bitcoinist does not guarantee or imply that the cryptocurrencies or projects published are legal in any specific reader’s location. It is the reader’s responsibility to know the laws regarding cryptocurrencies and ICOs in his or her country.

Bitcoin vs. Altcoins: Explaining the Difference

When it comes to the cryptocurrencies, Bitcoin is regarded as the king in the stable. It was the first cryptocurrency that debuted in the market to end the dominance of Fiat currencies and since its inception, Bitcoin continues to remain the largest cryptocurrency by market capitalization. It has already covered a decade long journey in its life cycle and witnessed many highs and lows.

Bitcoin and Altcoins

With time, however, other digital currencies also came into the market as the blockchain technology continued to evolve. All these new digital coins are called “altcoins” and although the technology of decentralization remains at the heart of each cryptocurrency, altcoins come with the added convenience of enhanced functionality owing to more number of used case scenarios. Take, for instance, the second-largest cryptocurrency by market capitalization, Ethereum which although operates on the same principle decentralization and peer-to-peer networking but comes with the added functionality of smart contracts. This smart contract feature allows Ethereum to execute the contract between two parties automatically using the open ledger technology. Similarly, we have several different applications and use cases for different altcoins, which help them to find their unique positioning against Bitcoin although fundamentally all digital coins work on the same principle.

Transaction Speed and Mining

Another important difference between Bitcoin and altcoins is the superior ability of the latter to handle a large number of transactions compared to Bitcoin. The process of verifying transactions in case of Bitcoin (which is also known as mining) is quite expensive and resource-intensive. However, altcoins use more innovative and affordable method for verifying transactions and hence, come across as a faster and affordable way of completing transactions. Consider the examples of altcoins like Dash and Ripple, which are known for their unique positioning vis-à-vis Bitcoin. Dash is focused on the speed and claims to process one transaction per second which is quite phenomenal compare to other altcoins as well as Bitcoin. Ripple, on the other hand, has focused on cross border transactions and offers a unique and convenient way of transferring the money between large institutions and organizations across borders.

Therefore, by focusing on some unique aspects and functionality, these altcoins have made a special place in the crypto sphere. In sum, both Bitcoin and altcoins work on the same blockchain technology; however, they differ on the aspects of functionality, transmission speed, and cost factor involved in the transactional process.

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