An altcoin is any cryptocurrency other than bitcoin. The word is short for "alternative coin" (Yahoo Finance, May 7, 2026). The label only tells you that an asset is not bitcoin. It says nothing about what the asset does, how it is built or how risky it is. To learn those things, you need two more questions: is the asset a coin or a token, and what job is it designed to do?
Where the term comes from
Bitcoin was described in the white paper "Bitcoin: A Peer-to-Peer Electronic Cash System" by Satoshi Nakamoto. Every cryptocurrency that came after it falls under the altcoin label. Namecoin's developers describe it as "the first fork of Bitcoin," and they still call it one of the most innovative "altcoins." Namecoin's initial release is dated April 18, 2011.
Coin or token: a separate question
Whether an asset is an altcoin and whether it is a coin or a token are two different questions.
- Coin. A coin is "the native asset of its own independent blockchain," such as ether (ETH) on the Ethereum network (Yahoo Finance). Ethereum's own site describes ether as "the native cryptocurrency that powers the Ethereum network." It is used to pay network fees, called gas, and to secure the chain through staking.
- Token. A token is a digital asset that runs on a blockchain that already exists. On Ethereum, most fungible tokens follow ERC-20, a standard for fungible tokens proposed by Fabian Vogelsteller in November 2015. In an ERC-20 token, a smart contract on Ethereum keeps track of who holds the tokens. The token is not the network's native asset.
Put the two questions together and you can place any asset:
| Asset | Altcoin? | Coin or token? |
|---|---|---|
| Bitcoin | No, by definition | Coin (native to its own chain) |
| Ether | Yes | Coin (native to Ethereum) |
| An ERC-20 token | Yes | Token (issued by a contract on Ethereum) |
| USDC or USDt | Yes | Token (issued on other blockchains) |
Is your asset an altcoin, a coin or a token?
Answer three questions about one crypto asset to place it on both lines: altcoin or not, and coin or token.
Is the asset bitcoin?
- Yes, it is bitcoin → Not an altcoin: a coin
- No, it is another cryptocurrency → next question
Is it the native asset of its own independent blockchain, the way ether is native to the Ethereum network?
- Yes, it has its own blockchain → Altcoin and coin
- No, it runs on a blockchain that already exists → next question
Does its issuer say it is pegged 1:1 to a currency such as the US dollar and backed by reserves?
- Yes, the issuer describes a 1:1 peg → Altcoin and token: a stablecoin
- No, or I cannot find such a statement → Altcoin and token
An altcoin is any cryptocurrency other than bitcoin, so bitcoin is the one asset the label excludes by definition. It is a coin, native to its own chain.
It is an altcoin because it is not bitcoin, and a coin because it is native to its own blockchain, like ether, which pays network fees (gas) and secures Ethereum through staking. Next, find its stated job and read the project's own documentation on who can create new units.
It is an altcoin and a token: it depends on another network and on a contract someone deployed. On Ethereum most such tokens follow ERC-20, where a smart contract keeps track of who holds them. Read the issuer's documentation for what backs it (if anything), who can create new units and what rights holders actually have.
Stablecoins such as USDC and USDt count as altcoins and are tokens issued on other blockchains. Their 1:1 backing is the issuer's own statement, and a peg is a design goal, not a guarantee: if the market loses confidence in the issuer or its reserves, the price can move away from $1.
This only sorts one asset by the article's definitions; it cannot check an issuer's reserves or claims, does not say whether an asset is safe or worth holding, and regulators warn that crypto is high risk and you could lose all the money you put in.
Stablecoins: altcoins that are designed not to move
Stablecoins count as altcoins under the definition, but they are built to behave very differently from most of the category.
- USDC. Circle says USDC can be redeemed "1:1 for US dollars" and is "100% backed by highly liquid cash and cash-equivalent assets." Circle lists USDC as natively issued on 38 blockchains as of September 16, 2026, including Ethereum and Solana.
- USDt. Tether says its tokens "are pegged at 1-to-1 with a matching fiat currency and are backed 100% by Tether's reserves." It lists blockchains such as Ethereum, Solana and Tron.
These are the issuers' own statements. A peg is a design goal, not a guarantee. If the market loses confidence in an issuer or its reserves, the token's price can move away from $1.
Why the label alone tells you little
Under the altcoin label sit network coins like ether, dollar-tracking stablecoins, tokens issued by smart contracts, and thousands of other projects. They differ in purpose and supply, and in who controls them. A more useful way to look at any altcoin:
- Check where it lives. Is it a coin with its own blockchain, or a token that depends on another network and on a contract someone deployed?
- Find its stated job. It might pay network fees, track a currency, give access to an application, or have no stated function beyond trading.
- Read the issuer's own documentation. Look for what backs it (if anything), who can create new units, and what rights holders actually have.
What regulators warn about
Financial regulators warn about crypto assets as a group, altcoins included:
- The UK Financial Conduct Authority says crypto "remains high risk with no protections if something goes wrong." It says investors "should be prepared to lose all the money you have invested," and that "it is highly unlikely you will be covered by the Financial Services Compensation Scheme." The FCA page was last updated January 29, 2026.
- The US SEC's investor alert "Exercise Caution with Crypto Asset Securities" says these investments "can be exceptionally volatile and speculative." It says the platforms that offer them "may lack important protections for investors," and that "the only money you should put at risk with any speculative investment is money you can afford to lose entirely."
To see how the market's value splits between bitcoin and all other coins, read our guide to altcoin dominance and bitcoin dominance.
