Crypto have revolutionized the global financial system, opening up new possibilities for digital transactions, cross-border transfers, investments, and much more. Bitcoin, created in 2009, was the first crypto and continues to lead the list of the most valuable digital currencies today. Since then, the market has grown rapidly, leading to the emergence of thousands of altcoins, also known as “alts,” which serve different functions and explore blockchain technology in various ways.
What Are Altcoins?
The term “altcoin” is short for “alternative coin” and is used to describe any crypto other than Bitcoin. The numbers are impressive. On CoinGecko alone, for example, there are over 17,000 cryptos listed, with a total market capitalization of nearly US$ 3 trillion (as of March 26, 2025). The data also shows Bitcoin’s dominance at 58.7%, with a market capitalization of US$ 1.72 trillion. This means that altcoins represent a considerable share of the total digital assets market, though this percentage fluctuates over time.
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Of course, the vast majority of these cryptos have little long-term impact or success. However, some altcoins have stood out since their creation and gained traction among industry enthusiasts. Each one pursues different purposes, functionalities, and technological innovations. Some aim to improve Bitcoin’s technical aspects, such as transaction speed and costs, while others focus on entirely new functionalities.
Types of Altcoins
There are various types of altcoins. One of the most popular categories is stablecoins, whose value is pegged to a stable asset. In October 2023, Brazil’s Federal Revenue Service reported the growing use of these “stable cryptos” in the country. Tether, the leading stablecoin by market capitalization, saw transactions exceeding R$ 271 billion in Brazil since 2019, compared to R$ 151 billion for Bitcoin.
Another type of altcoin is mining-based coins, like Bitcoin. Participants, known as miners, validate transactions on the blockchain and receive coins as rewards. One of the most well-known examples is Litecoin.
Tokens have also gained popularity, both utility tokens and governance tokens. Utility tokens, such as those on the Ethereum network, can be used in various decentralized applications (dApps), including games and financial platforms. Governance tokens, on the other hand, allow holders to vote on decisions about a project’s future, promoting decentralization as a key advantage.
Perhaps the most recognizable altcoins to the general public are memecoins. As the name suggests, these cryptos are inspired by internet memes or jokes and gain support through viral campaigns and celebrity endorsements. The most prominent example is Dogecoin (DOGE). According to CoinMarketCap data from March 26, 2025, DOGE ranks as the eighth-largest crypto, with a market capitalization of over US$ 28 billion.
Advantages and Disadvantages of Altcoins
Altcoins are a highly diverse group, ranging from serious financial projects that have gained a foothold in the global market to digital currencies created as a joke with little significance. Among the advantages of alternative coins are technological innovation, which aims to make processes faster, easier, and cheaper. For instance, Ethereum’s smart contracts have enabled the creation of decentralized applications, opening up a new and promising digital frontier. According to Reports and Insights, the dApp sector reached US$ 31.2 billion in 2023 and is expected to grow at 22.2% annually until 2032, potentially reaching a market value of US$ 139.6 billion.
On the other hand, caution is essential when dealing with altcoins. Smaller projects tend to be highly volatile, with significant price swings over short periods. This means that the promise of overnight profits can quickly turn into substantial losses. Another key concern is security. Since many projects are relatively new and less tested, some altcoins may have security vulnerabilities or become targets for hackers. According to Chainalysis, over US$ 1.7 billion in crypto were stolen in 2023.
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