Whenever the word “cryptocurrency” is mentioned, Bitcoin comes to the mind of most people. Just a handful of folks out there know about Altcoin, while some people still fall into the risk of investing in Altcoin that fades away with market crashes.The birth of Bitcoin did usher in other cryptocurrencies built on peer-to-peer decentralized networks. Altcoins did follow the standards of Bitcoin, although some were created to function more than Bitcoin, which is why investors need to have knowledge on what each of these altcoins can offer in their portfolio.We need to take a closer look at what Bitcoin and Altcoins are so we can make better decisions on our investment choices. With that in mind, let us step back a little to know the meaning of the following;What are Cryptocurrencies?Bitcoin and the alternative coins to Bitcoin are all part of cryptocurrencies. Hence the need for us to know that cryptocurrencies are virtual or digital money that comes in the form of tokens, also known as coins. Cryptocurrencies are completely intangible, even though some have found their way into the physical world with other projects and credit cards.What is Bitcoin?Bitcoin is a digital currency which is decentralized in creation and can be transferred via a peer-to-peer network. Transactions done in Bitcoin are recorded in a public distributed ledger known as blockchain while they are verified by network nodes through cryptography.What are AltCoins?Altcoins are cryptocurrencies that are alternative coins to Bitcoin and traditional fiat money. Altcoins are majorly created to improve areas where Bitcoin is lagging, such as energy efficiency and transaction speed. Developers have other specific goals with which they use in creating altcoins that serve purposes to meet those specific goals.There are thousands of altcoins, with the first being created in the year 2011. A large part of the crypto market is occupied by altcoins. Hence, as a crypto investor, you need to understand the various types of altcoins, their uses, advantages, and disadvantages.https://medium.com/media/8efc40be5a12b00a3b0cab25a378fdf3/hrefTypes of AltcoinsThe different types of altcoins all depend on how they work and the purpose they serve. Below are the types of cryptocurrencies you will come across when conducting your research.Staking Based CryptocurrenciesThese cryptocurrencies use the process of staking to verify transactions in order for more coins to be added to the supply. The staking-based cryptocurrency holders can decide to pledge their coins for transaction processing, while the cryptocurrency’s blockchain protocol gives participants crypto rewards. Staking has become popular these days because of its energy efficiency, which is better than mining. Peercoin, which is one of the earliest altcoins, was the first to introduce the concept of staking.Mining Based CryptocurrenciesBitcoin is a typical example of a mining-based cryptocurrency. Being the first cryptocurrency, mining was first used to process crypto transactions. Basically, mining-based cryptocurrencies involve the use of devices to solve mathematical equations. The first miner lucky enough to solve the equation gets to verify a block of transactions and gets to receive crypto rewards. The downside to mining-based cryptocurrencies is their requirement for massive energy to mice coins.StablecoinsStablecoins are set to mimic the value of another asset while they make an attempt to follow the price. Most valuable stablecoins are pegged to the U.S dollar and are corrected by the issuer when the price fluctuates. Examples of stablecoins are the USDC and USDT.Stablecoins are mostly used for savings or to send money but are not seen as a cryptocurrency investment because they maintain the same value as the asset they are pegged with.Governance TokensHolders of governance tokens are part of the decision-making aspect of the project involved, as they have the voting rights to proposals related to the cryptocurrency. This further enables these types of cryptocurrencies to be decentralized as the direction of the projects is not decided by one central authority.Should you Invest in Bitcoin or Altcoins?https://medium.com/media/d17e0fd0f4495dc86c56301616c70314/hrefYou should invest in both Bitcoin and other viable altcoins if you want to take cryptocurrency investment seriously. This is not financial advice, as you are advised to conduct your research with due diligence.Some altcoins are made up of ambitious projects that tend toward solving problems while Bitcoin is primarily used as a store of value. These altcoins could see higher increases in price as they are not well known currently. There are thousands of altcoins, and this may pose a challenge for you to pick the best to invest in. As such, most of the smaller altcoins are scams or dubious investments that will fade away sooner or later.Examples of Altcoins are:EthereumPolkadotSolanaUSDCDogecoinPolygonAnd a whole lot of others. One place you check cryptocurrencies and their market capital values and the circulating supply are on Coinmarketcap. Remember to do your own research before investing in any altcoins.You can connect with me via Telegram at: https://t.me/kelvinacha Connect with me via Twitter: https://twitter.com/KelvinAcha2Do you want to be a successful cryptocurrency trader and rake in profits on a continual basis? Then consider getting this course and learn from the masters. Click here to get yours now.NB: If you sign up with the above affiliate link, I will get a small commission from it at no additional cost to you.You can read up about the blockchain industry from our frequently updated blog here: https://blockject.com/blog/You need well-researched and highly optimized content for your blockchain project or website? Then check our services via the link below or contact me directly: https://blockject.com/shop/Check out our new platform 👉 https://thecapital.io/https://twitter.com/thecapital_iohttps://medium.com/media/3b6b127891c5c8711ad105e61d6cc81f/hrefShould I Invest in Bitcoin or Altcoins? was originally published in The Capital on Medium, where people are continuing the conversation by highlighting and responding to this story.