What Is Altcoin?

What Is Altcoin?

Given the popularity of cryptocurrency, there is a lot of talk about altcoins. There are also a lot of altcoin scams. If you’ve lost money on the blockchain, altcoin recovery is not only possible, it can be successful. To improve your chances and to keep your money safe, it’s worthwhile to learn more about altcoin and what a typical altcoin scam looks like. 

Many people think that altcoin is a specific type of cryptocurrency. Instead, it was a name developed not long after the introduction of bitcoin to indicate digital currencies other than bitcoin. The term altcoin is a combination of the words “alt” and “coin.”

There are many altcoins to buy. In 2021, the number of altcoins exceeded 12,000. It may be hard to decide which coin to buy and unfortunately, many of these coins are altcoin scams. Therefore, it’s important to do thorough research before buying altcoins.

Unfortunately, along with legitimate altcoins, there are a large number of altcoin scams that rob traders of billions every year. Contrary to widespread belief, altcoin recovery is possible even in tough cryptocurrency fraud cases.  

Are you the victim of an altcoin scam? If so, altcoin recovery may seem like a challenge. MyChargeBack professionals, however, meet this challenge with expertise and proven strategies designed for altcoin recovery. We have combined decades of experience dealing with forex scams, altcoin scams, and other types of fraud and we can provide guidance that will help you on the road to altcoin recovery.

How Altcoins Were Developed

Bitcoin was introduced as the first and the main form of cryptocurrency in 2008. Not long after the introduction of bitcoin, there were many criticisms about shortcomings, including the amount of energy and time devoted to mining it and volatility in bitcoin price. 

Even with the development of thousands of altcoin varieties, the altcoin market is only 40% and bitcoin still dominates the main share of cryptocurrencies with 60% market share. However, the rise of certain types of altcoins may grow to take a larger share as they become more popular. Therefore, the possibility of running into an altcoin scam is real.  

Many types of altcoins function in the same way as bitcoin, which works as a peer-to-peer system with computers that deal with huge amounts of data. There are some altcoins, however, that work differently. Bitcoin creates blocks through computers solving complex problems. This approach is seen as energy and time-intensive. Some forms of altcoins expedite this process and save energy using smart contracts on other crypto assets. 

Many new altcoins were developed to address issues and provide remedies for bitcoin’s shortcomings. However, others are altcoin scams created solely to take money from people. 

Altcoin scams are often advertised on social media and are accompanied by extravagant promises to double or triple money in a short space of time. Unfortunately, 80% of ICOs are nothing more than altcoin scams, and it is important to look carefully before looking for altcoins to buy. 

Categories of Altcoins

There are thousands of new coins on the altcoin market, but they usually fall into one of the following categories. 

Mining-Based Altcoins

These altcoins, like bitcoin, have to be mined. This means creating blocks through computers and solving complex math problems. Litecoin, ZCash, and Monero are produced through this block method. New altcoins that are not based on mining are “pre-mined” and do not depend on an algorithm before they hit the altcoin market. Ripple is one example of these pre-mined digital coins. 

Security and Utility Tokens

Security tokens are among the best altcoins to invest in today because they are connected to assets and have a certain amount of stability and like stocks, can return dividends. These altcoins are like buying stock but in digital form. 

Utility coins are created by a specific company or service and are used for purchases of goods or services within that specific network. Think of tokens you purchase at a fair to spend on rides. This is the digital equivalent of that system. 

Stablecoins

One of the complaints consumers had with bitcoin was the volatility in its price. For instance, between October 2020 and April 2021, bitcoin rose from $10,000 to nearly $60,000, before collapsing back down again. Some traders like to game this volatility and others want something more stable. 

Stablecoins keep altcoin prices from fluctuating too much by connecting them to other assets, currencies, or precious metals that have more stability. Stablecoins are among the best altcoins to invest in for those who are more risk-averse and are concerned about the price volatility of bitcoin. 

About Altcoin Scams

Along with legitimate altcoin, there are unfortunately many altcoin scams. It is important to keep in mind that altcoin scams outnumber real opportunities, so research the new altcoin well before buying it. One trick is that scammers will get investors to buy a defunct coin that is no longer active and turn it into an altcoin scam. 

The following are some essential steps to take to avoid losing money in altcoin frauds:

• Work only with a licensed cryptocurrency platform or with a regulated broker
• Research the currency well before buying. 
• Purchase it with a method other than cryptocurrencies
• Find press or media about the cryptocurrency — not just press releases
• The cryptocurrency should be associated with a secured website
• There should be significant research and white papers on the altcoin
• Find out who is behind the altcoin and what their credentials are

The main drawback for people who want to invest in altcoin is the lack of regulation of cryptocurrency. Stocks, fiat currencies, precious metals, and other assets have government organizations that provide oversight and can crack down on fraud. Cryptocurrency as of yet has very little regulation and therefore, there is less recourse for the consumer in the case of an altcoin scam than there is for securities fraud. 

Do You Need Altcoin Recovery?

Taking the time to investigate a new altcoin is an important step to avoid an altcoin scam. If you have lost money in a crypto scam, it is important to find experts who can get you started on the altcoin recovery process. Cryptocurrency can be recovered by experts, despite certain challenges. For successful altcoin recovery, you need professionals who create intelligence reports and work closely with law enforcement and regulators.

MyChargeBack experts provide guidance to consumers who are trying to recover their funds from broker disputes, an altcoin scam, or any other type of fraud. We consult with clients, and research brokers, and create intelligence reports that will assist in fund recovery. In addition, we help clients retrieve their funds through chargebacks and wire recalls.