As Bitcoin is the first cryptocurrency that captured the world’s imagination, all other coins were subsequently termed “altcoins,” as in “alternative coins.”

The term “altcoin” is used to describe any cryptocurrency that is not Bitcoin. As Bitcoin was the first cryptocurrency, any cryptocurrency that was created after was treated as an “alternative.” Some people, particularly bitcoiners, consider Ethereum to be an altcoin as well. Others now exclude Ethereum from the list of altcoins and consider all cryptocurrencies other than Bitcoin and Ethereum to be altcoins. 

Altcoins are all cryptocurrencies other than Bitcoin and Ethereum. Bitcoiners like to stress that Bitcoin is not a cryptocurrency but its own category. However, there is no difference between crypto and altcoins.

There are several different types of altcoins.

Payment tokens focus on payments as their main use case. These tokens are often not considered to be “real” cryptocurrencies since they tend to be more centralized.

A utility token is one that can be used for a specific purpose within its ecosystem. For instance, paying for gas can be considered a utility. 
A memecoin is a cryptocurrency that was created as a joke and with no obvious utility. For example, Dogecoin and Shiba Inu are two popular memecoins. 
Stablecoins are cryptocurrencies that are pegged to currencies like the dollar and are often backed with collateral in fiat currencies. Stablecoins are not “real” altcoins since their value does not oscillate like other cryptocurrencies.

Altcoins have several different pros and cons.

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