As you know, each cryptocurrency based on its own blockchain network has been developed; For example, Bitcoin operates on its own network called Satoshi.
In the world of digital currency, apart from these two, there are other cryptocurrencies that need their own network for development, these networks are called altchain. Many crypto traders are still divided on whether altcoins are worth using or not.
Some believe that the existence of altchains and currencies based on them do not have a significant impact on the development of the crypto world, but this is not true. In fact, blockchain networks can be much stronger than Bitcoin and Ethereum. Stay with us until the end of this article to learn more about altchains, as well as the value and benefits of using them.
What is Altchina?
Any blockchain that is not Bitcoin or Ethereum is called an alt-chain or an alternative blockchain; This is the simplest definition of altchain that can be given. Alternative blockchains entered the crypto world in 2011. Alt chains are also called “alt L1s” or alternative Layer 1 blockchains. It is true that Bitcoin and Ethereum blockchains are currently the most popular and well-known blockchains in the crypto world and are older than alt-chains, but they are not the only influential blockchains.
These altchains are actually using Blockchain algorithms They are used to create a platform for signing contracts, registrations and other actions in the world of cryptocurrencies. It is not bad to know a concept called Altchains Integrated mining (merged mining) exists, based on which miners can connect with blockchains, such as the Bitcoin blockchain. In addition, altchains as a means to use DNS, currency exchanges peer to peer (P2P) and file storage are also used. All cryptocurrencies based on altcoins are called altcoins.
Different types of alt china
Alt China, in turn, has different types, which we will discuss below:
Layer 0 protocols
The layer 0 protocol is the first layer among all blockchain layers that integrates seamlessly with other protocols to create Interconnected blockchains (interconnected value chains) connects and creates a stronger network for all smart contracts.
One of the problems solved by this layer is Scalability (scalability). Scalability means the ability of an organization or system to maintain or increase its performance with increasing workload. When a system cannot perform well with increasing workload, it has a scalability problem. By using layer 0 protocols, operators can easily communicate with each other, and this solves the problem of scalability in ecosystems.
In addition, the blockchain layer 0 protocol can be used for validation, categorization of cryptocurrencies and more. This layer acts as the base layer and allows interoperability with all layer 1 protocols such as BTC, ADA, ETH, etc.
The Layer 0 protocol allows users to build blockchain-based businesses and applications, validate ecosystems, create digital currency, and program their own unique business logic and metrics. Polkadot is currently the most famous example of a Layer 0 protocol.
Layer 1 protocols
Both Bitcoin and Ethereum blockchains are examples of layer 1 blockchain protocols. These are self-sufficient blockchains that are able to confirm and execute transactions made in the crypto world without the support of any other network. Blockchains at this layer work by incentivizing Bitcoin miners and Ethereum stakers, both of whom are important network validators, as well as promising new tokens and transactions.
Popular altchains such as Cardano and Solana are also among the layer 1 blockchain protocols. Both of these are original, self-developed and self-sustaining blockchains. Some layer 1 altchains already exist as a subset of a main blockchain; For example, the Bitcoin Cash blockchain is a fork of the main Bitcoin blockchain and Ethereum Classic is also a fork of the DAO version and before the Ethereum blockchain was hacked.
Although both of these have a common origin, over time they can become completely different from their original blockchain; For example, the main blockchain of Ethereum recently tried to Proof of stake consensus and Ethereum classic blockchain proof of work It is focused.
Layer 2 protocols
Just as we can build layer 1 protocols on top of layer 0, layer 2 protocols can be built in parallel or on top of layer 1 blockchain protocols. Layer 2 protocols are built for several different purposes, some of them to solve the scalability problem and others to increase the power and performance of the layer 1 blockchain.
Layer 2 has the ability to shoulder some of the burden of the main chain by sending some data to different processing channels. Then transfer the processed data to the main blockchain protocol. As a result, the main blockchain will have a lower transaction volume and scalability problem, providing faster processing and response.
Additionally, most existing layer 2 platforms have been developed to allow the underlying blockchain protocol to remain unaffected. This means that when making small transactions, users don’t have to waste their time Miner Confirmation waste or pay high transaction fees. Layer 2 protocols are commonly known as the main blockchain catalysts that can maintain the decentralization benefits of Layer 1.
One of the most important advantages of layer 2 protocols is that the main blockchain does not have to change its structure or code; Because layer 2 simply acts as an additional and auxiliary layer. This in turn ensures the security of the underlying blockchain while providing greater throughput.
Some of the most important alt China
As we mentioned earlier, the tokens that are traded in altchain are called altcoins. But every altcoin does not have its own altchain, and most altcoins are tokens that run on a digital currency network that already exists; For example, one of the biggest cryptocurrencies is shiba inu, which was originally known as a memecoin. SHIB is a token ERC-20 is traded on the Ethereum network. When users trade SHIB, they must pay a fee to the Ethereum blockchain to process their transactions.
On the other hand, there are some altcoins that run on their own altchain. The most important of these altchains are described below (their native coins are also given in parentheses):
- (Ethereum (ETH
- (Binance Smart Chain (BNB
- (Solana (SOL
- (Cardano (ADA
- (Terra (LUNA
- Polkadot (DOT
- Avalanche (AVAX
- (Polygon (MATIC
- (NEAR Protocol (NEAR
- (Cosmos (ATOM
- (Fantom (FTM
- Arbitrum
- (Harmony (ONE
The future of alt china
As the crypto world progresses, we will likely see more dynamic and user-friendly altchains. Many popular decentralized tokens are expected to be implemented and traded on alt-chain networks in the future; Take the Flow blockchain as an example. Previously, NBA TopShot NFT blockchain-based sports platform, as well as similar platforms such as NFL and UFC, ran on this blockchain. All three of these have had great success in their careers so far. Now, if users want to use these programs, they must know Altchain and all its related matters well.
Advantages of using Altchina
As fully mentioned in this article, alt-chains and alt-coins are developing day by day and their use also has its advantages.
Altchain enables you to generate tokens for anything. Any idea, concept, meme or anything else can be your tradable token that you can create in just minutes.
Create long-term and short-term markets and trades for each idea and performance. You can create a market for Doge, AI, IoT, Elon, Sam, Trump or any token you like. Trade in alt china completely Decentralized Is.
By correctly predicting the future outcome, Prediction markets Create and participate in prediction markets to profit. Prediction markets, also known as betting markets and information markets, are actually markets created to trade the outcome of events. The prices that incentives offer can indicate the probability of that event occurring; For example, will FTX go bankrupt? What will be the price of DOGE in 2023?
Because Altchain is decentralized, you can use the bridge (ALT/ETH/BNB) to trade tokens between ecosystems. Transactions on Altchain take only a few milliseconds.
How to use Altchina
So far, you have learned about the advantages and positive features of altcoins and altcoins. Now, if you have decided to use them, follow the steps below:
Make a wallet
Using altchain is not much different from Bitcoin or Ethereum blockchains. To use it, users need to set up a wallet through which they can store and receive their tokens or transfer them. Exodus wallet and Coinbase wallet are two digital wallets and can interact with various blockchains, including the most important and well-known alt-chains.
Use Altchain to trade cryptocurrencies
Traders who intend to buy and sell altcoins can do this in two ways. The first way is to create a user account in a centralized exchange such as Binance. Then deposit the fiat currency and use it to buy and sell cryptocurrency. This method can be the cheapest option for users.
The second way is to use the main wallet of that cryptocurrency. Many wallets have the option of directly buying digital currency using fiat currency. In this case, the user no longer needs to use a centralized exchange to buy and sell currency.
Connect with the blockchain ecosystem.
After buying an altcoin, the user can trade or sell it in any Chinese altcoin he likes. It is also related to various decentralized applications. He can use and earn profit from decentralized financial platforms (DeFi) or receive cryptocurrency in exchange for playing on application platforms such as blockchain-based games.
Use alt-chain browsers to track your transactions
Large blockchains such as Bitcoin and Ethereum have a feature that allows users to track their transactions. The main alt chain also has this important feature. So try to use alt chains to track your transactions. For example, Cardano has a browser called Cardano Explorer and Solana Browser is also called Solana Explorer.
Be diligent in keeping your crypto assets safe
When connecting to or using decentralized applications (DAapps), be sure to double-check the website URL. There are fake and malicious websites posing as popular alt-chains to steal your crypto wallet information; So you need to make sure that the alt chain URL is correct.
Also try to keep your assets in cold wallets. Because these wallets keep your private wallet keys separate from the internet and computer and reduce the possibility of stealing your information and cryptocurrencies to zero.
What is Alt China? Introducing the most famous altchains for the first time on the Wallex blog. appeared.
