What are mainstream coins, altcoins, and tokens? How to differentiate between mainstream coins and altcoins?

What are mainstream coins, altcoins, and tokens? According to Bitcoinist, there is a new type of token called “air coins” in the cryptocurrency market. What are mainstream coins, altcoins, and air coins? They are typically referred to as native cryptocurrencies of blockchain networks such as Bitcoin and Ethereum, characterized by the absence of any centralized entity or institution that can control their prices. These cryptocurrencies are created by anonymous developers and are not controlled by central banks. Due to their association with other applications running on blockchain networks, it is difficult to determine which tokens will become mainstream trading pairs, but that does not mean that most people do not like these tokens.

How to differentiate between mainstream coins and altcoins

Editor’s note: This article is from BlockBeats (ID: blockbeats) and is authorized to be reproduced by Odaily Planet Daily.

There are two main differences between mainstream coins and altcoins. First, Bitcoin, with a total circulation of 21 million coins and a market value of over $10 billion, is obtained through exchanges. Second, the price of Bitcoin is highly correlated with the prices of other assets, but without any substantial changes. Third, most mainstream tokens currently on the market are issued by centralized institutions, which means they have certain uncertainties and risks. Fourth, in certain occasions, investors need to pay attention to key issues.

If the previous digital currency market has already reached a very high scale, the first of these two types is “mainstream coins.” Why are these mainstream coins called “mainstream” in the investment circle? It is simple: as long as you pay attention to a specific digital currency or a project in a specific field, it may become “popular” or even “internet-famous.” And when you enter this field, you will find that the “big brothers” often choose to follow their own footsteps to chase after various mainstream coins or altcoins they hold in their hands and profit from them – because they usually don’t directly buy them, but transfer their funds elsewhere for cashing out, turnover, and other operations. So today we want to talk to you about these mainstream coins and the so-called altcoins. What are altcoins? In general, “mainstream coins” are digital assets that can circulate as a medium of exchange and have cash-out value. For example, cryptocurrencies like Ethereum (ETH) and XRP are new applications using blockchain technology, many of which belong to the “substitutive innovation” (such as DeFi) model, but they are not real innovative products, more like a scam. Altcoins, on the other hand, are different. They refer to new technologies that allow ordinary people worldwide to easily own digital financial tools and services.

However, due to the small and limited total supply of most digital currencies, they cannot effectively resist inflation like other cryptocurrencies. Therefore, altcoins also fail to meet this basic requirement and can only rely on their own technological characteristics to maintain their price fluctuations. Conversely, it must have the following features:

1. Scarcity: All tokens other than Bitcoin can be used as a means of payment; 2. Easy to obtain, verify, and cannot be counterfeited; 3. Security: It can only achieve 100% transparency after sufficient testing and can quickly confirm the true status of all transactions on the network. 4. Anonymity: has privacy protection functions; 5. Strong liquidity (such as ERC20); 6. High degree of decentralization; 7. Smart contract compatibility: can achieve infinite scalability even in the most complex situations; 8. High degree of decentralization; 9. Interoperability. Why is this phenomenon called altcoins?