Bitcoin is the most dominant cryptocurrency in terms of market capitalization, adoption and acceptance. But it’s not the only crypto out there. There are other ones, too. Typically, coins that are an alternative digital currency to bitcoin are referred to as altcoins.
You may have even heard of a few of them, such as ethereum, litecoin and solana.
Altcoins have a smaller market cap, fewer users and less liquidity, making them more prone to price fluctuations and market manipulation.
“Additionally, altcoins may have weaker security and development teams, which can increase the risk of security vulnerabilities,” says Samuel Cohen, head of business development at the crypto mining software company Foreman Mining.
With that caveat on volatility, here are the top 10 altcoins by market capitalization.
Our list excludes meme coins and stablecoins. Memes are more of a category of their own, originating from an Internet meme or some other humorous characteristic. Stablecoins are pegged to fiat currencies and are not featured on this list either. We also excluded the token lido staked ether from this listing, as it’s a staking token.
1. Ethereum (ETH)
Market cap: $220 billion
30-day return: 4.7%
Ethereum is the largest of the altcoins. Some argue it should not be classified as an altcoin, having established itself as the leading smart contract blockchain.
It’s the most popular blockchain for developers to build on and a leader in the decentralized finance (DeFi) space, with a 59% share of the total value locked up.
Ethereum was launched in 2015 and conceived as an idea by programmer Vitalik Buterin. In September 2022, ethereum completed its much-anticipated upgrade called the “merge.” The merge transitioned ethereum’s blockchain verification system from proof of work to proof of stake.
2. BNB (BNB)
Market cap: $52 billion
30-day return: 2.3%
Binance is the biggest cryptocurrency exchange in the world. But it is more than just an exchange. This big name in the crypto world offers a suite of products, including its own blockchain and coin.
BNB is the native coin of this Binance ecosystem, and it’s used for all sorts of transactions. One of its main use cases is for exchange holders to take advantage of lower trading fees. It’s also used to pay transactions on the BNB Chain, where developers can build projects.
BNB Chain was formerly known as Binance Smart Chain, while BNB was formerly known as Binance coin; however, both have been rebranded to establish that they are distinct, decentralized projects.
3. XRP (XRP)
Market cap: $23 billion
30-day return: 8%
Ripple is a U.S.-based technology company that has developed blockchain infrastructure to build a payment network that could streamline cross-border payments. XRP is the native token of the network.
XRP is an unusual cryptocurrency; some argue it isn’t a cryptocurrency in the traditional sense because it lacks a decentralized nature. Its primary competitor can be described as being closer to SWIFT, the financial payment network.
4. Cardano (ADA)
Market cap: $13 billion
30-day return: 5.6%
Cardano is an alternative to ethereum by Charles Hoskinson, who worked at ethereum but had a falling out with its founder over the future direction of the chain.
Hoskinson wanted a more scalable, sustainable and interoperable version of ethereum, and cardano is now one of the world’s biggest cryptocurrencies. But it still lags far behind what ethereum has achieved to date.
5. Polygon (MATIC)
Market cap: $9 billion
30-day return: -9.8%
Blockchains often suffer from problems with scalability, and, namely, they can be expensive and slow. Layer 2 blockchains are protocols developed on top of Layer 1 blockchains to tackle this problem, and improve privacy and other attributes of the underlying blockchain.
Polygon is the biggest of the Layer 2 blockchains, running on top of ethereum. In simple terms, Polygon addresses some of ethereum’s issues by settling transactions on a separate ethereum-compatible blockchain. MATIC is the native token of the polygon blockchain.
6. Solana (SOL)
Market cap: $8.3 billion
30-day return: 2.7%
Solana is another Layer 1 blockchain designed to solve the elusive blockchain trilemma. The idea is that it’s difficult for a blockchain to achieve all three properties of decentralization, security and scalability simultaneously.
It’s a younger cryptocurrency, having only launched its mainnet in March 2020. Solana experienced a meteoric rise during the crypto bull run of 2020-2021 but has been besieged by problems in the past year.
The crypto has been plagued by several major outages and hampered by its association with disgraced FTX founder Sam Bankman-Fried, who is currently facing several federal charges in connection with the collapsed crypto exchange.
7. Polkadot (DOT)
Market cap: $7.2 billion
30-day return: -2.1%
Polkadot is a blockchain that is designed to support other blockchains. For that reason, some refer to it as Layer 0 instead of Layer 1.
It aims to solve the problems of scalability and security that blockchain struggles with via a multichain framework.
Like cardano (and ethereum since September 2022), polkadot runs a variation of a proof of stake validation system for its chain. DOT is the token that powers its blockchain.
Another similarity with cardano is that one of polkadot’s founders, Gavin Wood, formerly worked at ethereum. He left ethereum in 2015 and launched polkadot five years later.
8. Litecoin (LTC)
Market cap: $6.4 billion
30-day return: -5.7%
Litecoin was set up in 2011 with a fork of the bitcoin code. It was designed to be a more efficient version of bitcoin. Some consider it the first altcoin, which is sometimes described as the “silver to bitcoin’s gold.”
While it is still ranked among the biggest cryptocurrencies, litecoin’s standing in the world has fallen. It was once the second- biggest cryptocurrency behind bitcoin; however, it is not used much these days.
9. Tron (TRX)
Market cap: $6 billion
30-day return: 4.1%
Tron was initially created as a token on ethereum before migrating to its own network in 2018. It started in Asia but has since gone global and is now one of the biggest cryptocurrencies.
It was launched in 2017 by Chinese billionaire Justin Sun, also the CEO of BitTorrent, a file-sharing program. Tron is second behind ethereum in the DeFi space, currently holding 10.4% of the total value locked.
10. Avalanche (AVAX)
Market cap: $5.5 billion
30-day return: -0.9%
Avalanche is another protocol launched relatively recently. The mainnet went live in September 2020. Avalanche claims to have learned from other projects in the race to establish itself as the fastest, most secure blockchain.
Like several other blockchains on this list, avalanche is a smart contract platform where decentralized apps (dApps) can be built. What separates avalanche is that it is compatible with ethereum. The blockchain’s native token is AVAX, which can be used to pay transaction fees and governance.
*Market caps and pricing sourced from coingecko.com, current as of 5:30 p.m. EST on Apr. 24, 2023.
What are altcoins?
Altcoins are generally considered any cryptocurrency other than bitcoin, although some argue that the definition excludes ethereum.
The definition of an altcoin has evolved over the past decade. In the early days, only a handful of crypto assets existed. That’s why litecoin, launched two years after bitcoin entered the scene, is often referred to as the original altcoin. Today, altcoins aren’t necessarily in competition with bitcoin.
That said, many altcoins tend to be highly correlated with bitcoin. But they tend to carry more risk and greater volatility.
Frequently asked questions (FAQs)
Whether altcoins are worth it depends on the type of investor. Not only can volatility pull the value of an investment down by double- or even triple -digits, but several altcoins have turned out to be scams, with investors losing everything.
Cryptocurrencies are not considered safe investments. It’s a risk-on, high-risk asset class.
Bitcoin, the original crypto, is generally considered the least volatile. Altcoins show greater volatility — many have ceased to exist entirely in previous bear markets, with investors losing everything. Investors must be vigilant and understand what they are getting into.
