8 alternatives to Bitcoins: A guide to altcoins (2024)

Let's get the facts straight: Bitcoin is the undisputed king of the cryptocurrency space. It has a strong historic track record, and its price in the market often dictates the value of cryptocurrency as a whole.

But don't take it the wrong way; Bitcoin isn't the only financially viable cryptocurrency out there.

Many alternative cryptocurrencies-shortened to the term altcoins-have unique features, supply caps, and blockchain ecosystems that set them apart from Bitcoin.

Many of these altcoins provide real-life use cases, such as executing contracts and distinguishing identities through the blockchain.

However, several of these altcoins are not ideal investments in the long run. Given the loose regulations surrounding the cryptocurrency space, many altcoins remain in obscurity and fail to experience any noteworthy price action.

With that said, some Bitcoin alternatives can serve as respectable additions to one's cryptocurrency portfolio. This article will explain altcoins in more depth and will also list a few of these Bitcoin alternatives.

Let's start!

What are altcoins? How do they differ from Bitcoin?

A good way to distinguish Bitcoin from altcoins is by drawing a metaphoric comparison. Think of Bitcoin as the father of all cryptocurrencies, whereas altcoins make up its offspring. In short, altcoins are all cryptocurrencies that have been developed after Bitcoin.

Over the following years after Bitcoin's existence, multiple founders have established other cryptocurrencies-or altcoins-that offer their own unique spin and features that augment and improve upon the perceived limitations of Bitcoin and the crypto market as a whole.

More definitively, an altcoin is a token that runs on an independent peer-to-peer blockchain network. Just like stocks, many altcoins can also be bought, sold, and traded on a cryptocurrency exchange website.

Established in 2009 by the enigmatic Satoshi Nakamoto, Bitcoin's success and widespread adoption have led many other altcoins to flourish and make their mark in the cryptocurrency world.

Some altcoin founders only made incremental improvements and slight adjustments to their altcoin. For instance, Litecoin was made as a copy of Bitcoin's source code, differing only in market cap and faster transaction speeds.

However, some altcoins are vastly different from Bitcoin and instead offer new use cases based on their underlying blockchain technology.

Ethereum, for instance, is a decentralised computing network that can securely execute contracts-a feature that has many positive implications across industries from real estate to healthcare.

Certain altcoins, known as stablecoins, are simply pegged to real-world currency. For instance, USDT and USDC are pegged to the US dollar, whereas there are other altcoins pegged to other investments, such as the value of gold.

With thousands of altcoins on the market as of 2024, these tokens help contribute to creating a vast crypto landscape with a variety of use cases and specialised applications.

8 Alternatives to Bitcoin

With all that said, what Bitcoin alternatives should an investor consider if they want to grow their wealth?

Ethereum

The second-most popular cryptocurrency in the world is Ethereum. Launched by Vitalik Buterin in 2015, this cryptocurrency features robust blockchain technology that developers can use to build and deploy applications and smart contracts.

Ethereum does these things with little to no downtime, zero third-party interference, and maximum security, making it a highly respected cryptocurrency in the space.

Furthermore, Ethereum is also a recipient of constant updates under the Ethereum 2.0 project.

This update has been periodically rolled out since 2020 and has improved upon the existing Ethereum blockchain infrastructure. Specifically, the update is expected to transition the crypto into a proof-of-work (PoW) model.

Furthermore, this cryptocurrency offers Layer 2 scaling features, improving the speed, efficiency, and scalability of the cryptocurrency. It also makes it a more greener cryptocurrency, consuming less power than Bitcoin and past transactions by over 90%.

With a market cap of $442 billion, Ethereum is securely the second-most popular cryptocurrency in the market right now. View the current AUD to ETH price.

BNB

BNB, or Binance Coin, is the native cryptocurrency of the Binance blockchain called the Binance Smart Chain (BSC). Binance is considered the number-one most popular cryptocurrency exchange in the world.

For consumers buying and selling cryptocurrency on Binance, BNB is ideal because it offers them transaction fee discounts, staking opportunities, smart contract development capabilities, and other user incentives like the inclusion of a VIP program within Binance that offers even more discounts.

Furthermore, it also holds on its own as a potent investment opportunity, growing by over 1600% over the past three years. As long as Binance remains the number-one crypto exchange, BNB will remain a great investment opportunity for the average investor.

Litecoin

Litecoin is one of the first altcoins developed after Bitcoin, launched in 2011. This cryptocurrency offers a faster transaction confirmation time and lower transaction fees compared to Bitcoin. Furthermore, it also features a 4x higher supply cap.

Litecoin is often referred to as the silver equivalent of Bitcoin. It has a great host of features, but it's still smaller in terms of pure market capitalisation when compared to Bitcoin at $6.42 billion.

Regardless, it's a robust digital currency with lots of potential in the market. And being one of the first few altcoins out there, its reputation is cemented as one of the original cryptocurrencies to have ever been circulated.

Cardano

Cardano is another popular and top alternative to Bitcoin. Just like Ethereum, it uses a proof-of-stake network, which is significantly greener compared to Bitcoin's energy-intensive computer processing network.

Furthermore, it's also a secure altcoin because of its Ouroborus protocol, which uses an extended UTxO model that reduces cyberattack vulnerability.

Cardano's other primary use case is its staking and governance features. This allows investors to earn rewards and get access to security features exclusive to those who own this cryptocurrency.

With Cardano valued at $17.69B as of May 2024, this cryptocurrency is among the top-performing altcoins in the market right now.

Solana

One of the most recent successful entrants in the crypto space is Solana. Valued at $82 billion as of May 2024, this cryptocurrency is one of the best investments for people looking to diversify their cryptocurrency portfolio.

Just like other competitive altcoins, Solana has a Proof-of-Stake (PoS) network that can conduct thousands of transactions in a second. This makes it one of the fastest cryptocurrencies currently in existence, about 46 times as fast as Ethereum.

But the number one reason for Solana's burgeoning popularity is the dynamic DeFi and NFT landscape. It has a diverse community that has developed notable project tokens like Pyth.

While a lot of people attribute this token's exponential growth to the investments of a few institutional investors, Solana has features that make it a top contender in the blockchain space.

Polygon

Polygon is a layer 2 scaling solution for Ethereum. This cryptocurrency works similarly to Litecoin in the sense that it enhances its major competitor's drawbacks, particularly its scalability and speed.

Polygon, particularly its latest version, Polygon 2.0, is faster and offers near-limitless scalability. This makes it a highly valuable ecosystem that can attract developers and investors to invest in this project.

Some of the features of Polygon are its plasma chains, zk-rollups, and optimistic rollups. These all make decentralised applications (dApps) less congested and work more optimally for users when transacting or developing crypto projects.

Toncoin

The 9th most invested cryptocurrency in the world is TON, an altcoin developed by the founders of Telegram.

Shortened from The Open Network, TON features an easy-to-use blockchain network with record transaction speeds of 100,000 per second. For reference, Bitcoin can only do seven transactions at the same time, whereas Solana is half as fast.

Furthermore, people can get staking rewards for their TON investments and can instantly withdraw them in their Telegram when needed. This added accessibility makes this project, coupled with its $22 billion market valuation, a highly competent player in the crypto space.

XRP

XRP, the native cryptocurrency of the Ripple network, is designed for fast and cost-effective cross-border payments.

Just like Bitcoin, it has a limited supply of 100 billion coins, with only about 43% of them currently in circulation.

What makes XRP so special is its cheaper price range. It offers one of the fastest transaction times among all other cryptocurrencies. This characteristic has made it one of the premier options for cross-border payments.

Furthermore, XRP is also less energy-intensive than Bitcoin. This makes it a more environmentally friendly alternative to the crypto behemoth.

This information is of a general nature only and should not be regarded as specific to any particular situation. This should not be taken as financial advice to buy, trade, or sell cryptocurrency or use any specific exchange. This is not intended for use as investment, financial or legal advice as each individual's need will vary.