What Is an Altcoin? One Word for Everything Except Bitcoin

Here is a good one, from December 2013: two software engineers, Billy Markus and Jackson Palmer, take a copy of bitcoin's code, stick a grinning Shiba Inu on it and call it Dogecoin, build time about a week. The whole thing was a joke about the flood of new coins launching at the time, and more than a decade later the joke still sits among the largest cryptocurrencies by value, while thousands of earnest projects from the same years, whitepapers and roadmaps and all, are dead.

Every coin in that story bar one is an altcoin, the same word for the dog joke, the corpses and nearly everything else in crypto. Seven letters, doing far too much work.

The definition fits in one line

An altcoin is any cryptocurrency that is not bitcoin, short for alternative coin. The label dates back to bitcoin's first imitators, and it has been stretching ever since. Namecoin arrived in April 2011 and tried to move domain names onto a blockchain. Litecoin followed in October 2011, sold as the silver to bitcoin's gold, forking bitcoin's code and cutting block times to 2.5 minutes from roughly ten. Unlike most of its classmates, Litecoin is still around.

The trouble is scale: a word that files a dollar-tracking stablecoin, a chain running thousands of apps and a dog joke in the same drawer is not telling you much, so five rough groups end up doing the real sorting.

Chains that run programs

Start with the heavyweights: Smart-contract platforms are blockchains built to run code as well as record payments, and much of crypto's value outside bitcoin lives in this group. Ethereum opened the category in July 2015, and Solana, Cardano and Polkadot compete in it now, each with its own trade-offs on speed and decentralisation. Calling Ethereum an alternative to bitcoin rather undersells the difference, though. It is closer to an app platform than to digital cash, and its coin, ETH, is the fuel the network runs on.

Stablecoins and the rest of the plumbing

Stablecoins get filed under altcoins too, awkwardly, because USDT and USDC are built to track the US dollar, so they behave nothing like the rest of the list. Strictly speaking most are tokens issued on other chains, with no blockchain of their own. Casual speech ignores all of that, which is fine until fees or network menus come up.

Then the plumbing: Utility tokens pay for something specific, file storage, exchange fee discounts, a service's internal credits. Issuing one became a template job once the ERC-20 standard appeared in November 2015, which is why thousands of tokens now share the Ethereum network. Somewhere in amongst it all, payment coins, Litecoin again, or XRP, running since 2012 with cross-border transfers as its pitch, quietly keep doing the original job of moving value.

Memecoins

Memecoins are the group Dogecoin accidentally founded back in 2013, coins whose entire product is the joke and the crowd around it. The market, annoyingly, does not grade on seriousness, so no roadmap required.

The graveyard is bigger than the market

Now the part most explainers skip: far more altcoins die than survive.

Dead-coin trackers have catalogued thousands of abandoned projects. The real number is anyone's guess, because a coin rarely announces its own death. The developers drift off, the code stops updating, and trading thins out until the chart is a flat line nobody is on the other side of. Meanwhile fresh tokens launch every day, in numbers that make counting pointless, because creating one is cheap and quick.

Nor is death reserved for the tiny: TerraUSD sat near the top of the market-value list in early May 2022. Within about a week, roughly $40bn of paper value had evaporated.

So when Litecoin and Dogecoin make survival look normal, remember what you are looking at: you only ever see the survivors. The failures outnumber them enormously, and nobody writes guides about those.

Bitcoin dominance and alt season

One number tracks bitcoin against the entire altcoin field: bitcoin dominance, bitcoin's share of total crypto market value. It has sat around half in recent years, and it moves with market cycles. When dominance falls, smaller coins are outrunning bitcoin, and traders call the stretch an alt season. It has happened before: during 2017's initial-coin-offering boom, bitcoin's share fell steeply as new tokens multiplied. Treat that as history, though. Nobody has the faintest idea when the next one starts, whatever the chart-posters promise.

What this means when you actually buy one

Practically, the category question is a depth question. The further down the market-value list you go, the thinner the trading and the wilder the swings. A headline market cap can flatter a small coin badly too, and our market cap guide pulls that trick apart.

The bigger names are widely listed and can be bought with ordinary money through an on-ramp. Banxa has run that fiat-to-crypto plumbing since 2014, with more than 100 payment methods across 100-plus countries, in the markets it serves. The long tail is another world entirely: obscure venues, thin order books, and a genuine chance the project is already abandoned.

This guide describes a category, it is not financial advice, and it names no coins worth buying. Best-altcoin lists age about as well as the coins on them.

One habit worth keeping, though: before taking any altcoin seriously, ask three things, what it is for, which group it belongs to, and who would notice if it disappeared tomorrow. For thousands of coins already in the graveyard, the honest answer to the last one was nobody.