🪙 Bitcoin vs. Altcoins: Understand the difference and create your best strategy!

If you're just starting in the world of cryptocurrencies, the first words you'll hear are Bitcoin (BTC) and Altcoins. Knowing what each one is about is the first step to not messing up and creating a good investment plan.

1. What exactly are they?

  • Bitcoin (BTC): It's the real boss. Created in 2009 by Satoshi Nakamoto, it was the first crypto in the world and is the standard of decentralized digital money.

  • Altcoins: It's the combination of 'Alternative' and 'Coin'. In other words, they are all the cryptos that are not Bitcoin. Projects like Ethereum (ETH), Solana (SOL), Ripple (XRP), among many others, fall into this category.

2. Bitcoin vs. Altcoins: How do they differ?

Forget about boring tables, I'll explain it to you quickly and directly:

  • Symbol and nicknames

    • Bitcoin: It's the 'King of the market' and we know it as Digital Gold. It is considered the safest asset and the foundation of everything.

    • Altcoins: They're like the stocks of a tech startup. For example, Ethereum is sometimes called 'Digital Silver'.

  • The supply issue

    • Bitcoin: Only 21 million coins will ever exist. Period. That scarcity is what gives it so much value.

    • Altcoins: Each project has its own rules. Some are unlimited, others burn coins to reduce supply... each one is its own world.

  • Gains and volatility

    • Bitcoin: It's the thermometer of the market. It moves a lot, but it's more stable compared to others.

    • Altcoins: High risk and high reward! Their prices jump much more than Bitcoin's, which is why many seek quick profits here.

  • What are they for?

    • Bitcoin: It focuses on being a store of value (like gold) and a means of payment.

    • Altcoins: They go beyond just sending money. They serve for smart contracts, NFTs, DeFi (decentralized finance), and real apps.

3. Why do we need Altcoins?

They're not just there for the sake of it; they came to improve what Bitcoin doesn't do:

  • Technical improvements: For faster and cheaper transactions (e.g. Litecoin, Bitcoin Cash).

  • Scalability: To run applications on the blockchain (e.g. Ethereum, Solana).

  • Special uses: Private coins or stablecoins linked to the dollar (Stablecoins).

4. Be careful when investing (DYOR - Do Your Own Research)

  • Dominance: Check what percentage of the market Bitcoin has. When its dominance decreases, the famous 'Altseason' often starts.

  • Volatility risk: Alts can rise like foam, but they can also drop really bad. Don't put in money that you're not willing to lose.

  • Risk of disappearing: It's more likely for an altcoin project to fail due to technical issues than for Bitcoin to do so.

💡 Conclusion: If Bitcoin is the backbone of the market, Altcoins are the engines that make the ecosystem so varied. The key is to balance your portfolio according to how much risk you can handle.