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The Alternate Universe of Altcoins
Powering DeFi, Web3, and the Metaverse.
Altcoins refers to any cryptocurrency that’s not bitcoin or ether.
Cryptocurrencies and blockchain technology are changing the world. But to understand their potential, you need to look past currencies like Bitcoin and Ethereum and towards projects that use cryptos to power decentralized applications (dapps) and decentralized finance or “Defi” products. These new tokens act as incentives and payments for service in these new applications.
Trading crypto can be lucrative and new dispassionate, self-learning trading engines powered by AI are fascinating and exciting. But a sole focus on tokens trading alone is missing the point of crypto. Smart contracts that are essentially computer programs that power decentralized applications and how they are used within projects are the most important use case.
Trading coins and tokens isn’t the important part. Look for projects that add real value and are solving real problems in innovative ways. Look for utility and value added by projects powered by tokens.
Tokens that follow Ethereum’s idea of a Turing complete blockchain can develop and support smart contracts. Rather than use blockchain tech to power the currency, they use the currency to power the blockchain.
There are altcoins and dapps that ride on top of the Ethereum chain. That structure is called layer 2. And there are projects that are built on their own unique blockchain called third generation (Bitcoin is the first generation and Ethereum the second.)
A new trend is what’s called interoperability, which means where you can migrate from one blockchain to another seamlessly and quick. We are seeing a new ecosystem develop with a new generation of tokens and applications in what is known as the zero layer, the layer underlying the layer one blockchains and interconnecting them.
