Bitcoin was the first cryptocurrency, but today there are thousands of other digital assets, collectively called altcoins. In India, altcoin investing has become increasingly popular among investors looking to diversify beyond Bitcoin and Ethereum. This guide explains what altcoins are, how to buy them in India, and what to watch out for.
What are Altcoins?
The term “altcoin” refers to any cryptocurrency other than Bitcoin. Altcoin is short for alternative coin. Ethereum, Solana, XRP, BNB, Dogecoin, Shiba Inu, Cardano, Polkadot, Chainlink, and thousands of other tokens all fall under this category.
Altcoins can be broadly grouped into:
Layer 1 Blockchains: Independent blockchain networks with their own consensus mechanisms. Examples: Ethereum (ETH), Solana (SOL), Cardano (ADA), Avalanche (AVAX).
Layer 2 Solutions: Built on top of Layer 1 chains to improve speed and reduce fees. Examples: Polygon (MATIC/POL), Arbitrum (ARB).
DeFi Tokens: Governance or utility tokens for decentralised finance protocols. Examples: Uniswap (UNI), Aave (AAVE), Compound (COMP).
Stablecoins: Pegged to fiat currencies. Examples: USDT, USDC.
Meme Coins: Community-driven tokens, often with speculative value. Examples: Dogecoin (DOGE), Shiba Inu (SHIB).
Utility Tokens: Power specific platforms or ecosystems. Examples: Chainlink (LINK), Filecoin (FIL).
Is It Legal to Buy Altcoins in India?
Yes, buying altcoins in India is legal. All cryptocurrencies, including altcoins, are classified as Virtual Digital Assets (VDAs) under the Finance Act 2022.
- All altcoin gains are taxed at a flat 30%
- A 1% TDS applies on qualifying transactions
- Losses from one altcoin cannot be offset against gains from another
You must report all altcoin holdings and transactions in your ITR under Schedule VDA.
Consult a qualified tax professional for advice specific to your situation. Tax rules are subject to change.
How to Buy Altcoins in India: Step-by-Step
Step 1: Choose a Registered Exchange
Use an exchange registered with the Financial Intelligence Unit, India (FIU-IND). ZebPay is India’s oldest crypto exchange, founded in 2014, with FIU-IND registration and 400+ coins available for trading.
Step 2: Complete KYC
Submit your PAN card, Aadhaar, and selfie for verification.
Step 3: Deposit INR
Add funds via UPI, NEFT, or IMPS.
Step 4: Browse Available Altcoins
On ZebPay, go to the Markets section to see all available coins with their current prices, market caps, and 24-hour price changes.
Step 5: Research Before Buying
Before buying any altcoin, review:
- The project’s whitepaper or documentation
- The team behind it
- Its use case and competitive positioning
- Its trading volume and liquidity
- Any recent news or developments
Step 6: Place Your Buy Order
Select the altcoin, enter your INR amount, and use Quick Trade to buy at the current market price.
Step 7: Track Your Portfolio
Your altcoins will appear in the ZebPay Portfolio section. Monitor your holdings regularly.
Which Altcoins are Available on ZebPay?
ZebPay supports 400+ coins for trading in India. This includes major altcoins like:
- Ethereum (ETH)
- Solana (SOL)
- XRP (XRP)
- BNB (BNB)
- Cardano (ADA)
- Polkadot (DOT)
- Chainlink (LINK)
- Dogecoin (DOGE)
- Shiba Inu (SHIB)
- USDT and USDC (stablecoins)
Check the ZebPay app for the latest list of supported coins, as new listings are added regularly.
How to Build an Altcoin Portfolio in India
Rather than buying a single altcoin, many investors spread their investment across multiple assets. Here are some approaches:
Market Cap Weighting
Allocate more to large-cap altcoins (ETH, BNB, SOL) and less to smaller ones. This reduces but does not eliminate risk.
Sector Diversification
Spread across different categories: one Layer 1, one DeFi token, one stablecoin, and one utility token.
ZebPay CryptoPacks
ZebPay offers theme-based CryptoPacks that let you invest in a curated basket of coins with one transaction. These offer theme-based diversification without needing to research each coin individually.
SIP for Altcoins
ZebPay’s crypto SIP feature lets you automate regular purchases of your chosen altcoins with as little as ₹100 per instalment, helping you build positions gradually using Rupee Cost Averaging.
Read more: How to Build Your First Crypto Portfolio in India
Risks of Investing in Altcoins
Altcoins are generally higher risk than Bitcoin. Here is why:
Higher Volatility: Smaller market cap coins can gain or lose 50% or more within a single week.
Project Risk: Many altcoin projects fail to deliver on their promises. Tokens can become worthless if the team abandons the project or if the technology does not gain adoption.
Liquidity Risk: Less popular altcoins may have low trading volume, making it harder to sell without significantly impacting the price.
Rug Pull Risk: Some tokens are created fraudulently, with developers abandoning the project after raising money.
Regulatory Risk: India’s evolving crypto regulations could affect specific coins more than others.
Past performance does not guarantee future results. Always conduct your own research before investing.
Read more: Crypto Investing vs Crypto Trading
Frequently Asked Questions About Buying Altcoins in India
Which altcoins are best to buy in India?
No altcoin is guaranteed to perform well. Research each coin’s use case, team, and market conditions before investing. Always conduct your own research. This is not financial advice.
What is the minimum amount to invest in altcoins on ZebPay?
You can start with as little as ₹100 per coin on ZebPay.
Do I pay tax on every altcoin I buy?
Tax applies when you sell (or exchange) an altcoin for INR or another asset. A 1% TDS applies on qualifying transactions. Gains are taxed at 30%. Consult a qualified tax professional for your specific situation.
How many altcoins should I hold?
This depends on your investment goals and risk tolerance. Spreading across too many coins can dilute your research and monitoring capacity. There is no universal answer. Always conduct your own research.
Can I lose all my money on altcoins?
Yes. Some altcoins have lost 99% or more of their value. Only invest money you can afford to lose completely.
What is the difference between a coin and a token?
A coin operates on its own blockchain (ETH, SOL, ADA). A token is built on an existing blockchain (SHIB runs on Ethereum as an ERC-20 token, for example).
Is ZebPay safe for altcoin trading?
ZebPay is India’s oldest exchange, FIU-IND registered, and uses multi-layer security including 2FA. However, always keep security best practices and enable all available protections.
Final Thoughts
Altcoins offer exposure to a wide range of crypto projects and technologies beyond Bitcoin. In India, you can buy hundreds of altcoins through ZebPay with your INR balance, starting from as little as ₹100.
Altcoin investing carries significantly higher risk than investing in established assets. Research thoroughly, diversify across projects and sectors, and only invest what you can afford to lose.
Get started today and join 6 million+ registered users exploring crypto investing on ZebPay!
Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Each investor must do his/her own research or seek independent advice if necessary before initiating any transactions in crypto products and NFTs. The information in this article is for educational purposes only and does not constitute financial or investment advice.
