Why invest in altcoins? 4 Good Reasons

Investing in altcoins is worth it. In cryptocurrency jargon, altcoins are all cryptocurrencies other than Bitcoin. Such digital assets emerged after BTC, providing conceptual innovations, offering new services, and improving the original Bitcoin characteristics. Some best-known examples are Ethereum, XRP, Litecoin, Dash, EOS, Monero, Zcash, and so on.

There are some altcoin skeptics within the crypto world. In fact, a derogatory term has been coined for any currency other than Bitcoin: shitcoin. In general, these users discredit altcoins’ potential to gain space in the crypto market and be widely adopted in the future.

There are quite a lot of promising altcoin projects in the short, medium and long term, but there is misinformation about them.  Four good reasons to invest in altcoins are listed below.

Four good reasons to invest in Altcoins

1.     Altcoins bring innovations in relation to Bitcoin

Altcoins offer innovations and improvements in relation to BTC as they emerged a few years after Bitcoin’s release.

Some of BTC’s issues have become clearer with its network growth. Now there is a greater understanding of how its technology works.

  1. Imperfect anonymity: Transactions between Bitcoin wallets are stored in a public spreadsheet, therefore it is not difficult to track a user’s IP and find their true identity;
  2. Transaction speed: Bitcoin transactions can take over 10 minutes. Validated transaction blocks are relatively small and the demand for transactions is enormous. Congestion is common on the network;
  3. Centralized mining: The mining process has become progressively more expensive due to the network growth. Currently, only large investors can do it. This has made the network less decentralized. In addition, the environmental impact is enormous: the Bitcoin network spends the equivalent of Austria’s energy consumption in one year!

All these problems make it difficult to adopt Bitcoin in daily transactions, preventing its popularization. Altcoins offer multiple solutions to these problems. Here are some examples:

  • Dash – PrivateSend system: This cryptocurrency allows transactions with total anonymity. InstantSend system: Transactions take a few seconds to be completed;
  • Ethereum – It has brought smart contract innovation. These are contracts made and legitimized by computers, allowing numerous types of transactions between parties;
  • EOS – In addition to smart contracts and transaction speed, this cryptocurrency uses a Proof of Stake system, whose decentralization is higher and energy consumption is minimal.

In the long term, these altcoins may have greater daily use adoption potential than Bitcoin. After all, cryptocurrencies do not only compete with each other, but also with fiat money. In this sense, such differences and innovations are essential for their wider adoption.

2.      Great earning potential   

It is difficult to know the “real value” of a cryptocurrency, as there is a lot of speculation on the market. However, there is no doubt many altcoins are undervalued.

Why? These altcoins provide some kind of extra value to traditional money: decentralization, anonymity, speed, transactions without third parties, etc. In this sense, their growth potential is quite large, no matter how long it takes for their adoption. Currently, their value is below what they will cost in the future.

In the article Best Cheap Cryptocurrencies, we offer some interesting suggestions for low-cost altcoins with great growth potential in 2020.

3.     Investment diversification

In a volatile market such as crypto, investment diversification is essential to obtain constant returns. If the chances of winning are great, so are the chances of losing. Large fluctuations in less than 24 hours are not unusual. This also applies to Bitcoin.

In this sense, diversifying a crypto portfolio can increase profits and minimize losses. For this reason, it is important to look for innovative crypto projects that add value and have a strong team behind them. This will help them grow faster at the beginning, and more balanced in the medium and long term.

4.     Cryptocurrencies beyond financial services

Many altcoins are associated with specific services, as well as being a means of payment and savings. For example, there are cryptocurrencies created only for philanthropic activities. Others are linked to large exchanges around the world. Their value is linked to the same size of their exchange: they are called utility tokens. There are even famous football teams around the world creating their own cryptocurrencies!

Investing in such altcoins  also means investing in specific services, project values, or the expectation that a company will generate value. It is a good way to promote personal interest projects and obtain good return opportunities.

Conclusion: investment in altcoins is promising

As mentioned above, there are consistent reasons to make an investment in altcoins. Altcoins are a way to invest in innovative services, diversify your portfolio and, of course, do good business.

Cryptocurrencies are relatively new, and their technology still has great adoption potential. In the next few years, we will experience their progressive expansion to the most varied types of services. It is a good time to invest in this early stage of the technology.

Learn more about altcoins with the Crypto-Diversity Program

Cripto InterCambio has launched the Crypto-Diversity Program in order to accelerate the adoption of cryptocurrencies and expand knowledge about them. In this program, we offer exclusive content about altcoins on our blog, Facebook and Twitter, including exclusive articles and interviews with cryptocurrency ambassadors.

In addition, we offer a commission-free exchange on selected altcoins. For more information, visit our website Crypto InterCambio. Until next time!

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