So you want to invest in cryptocurrency. Perhaps you even tried your hand at buying Bitcoin, or the recent surge in Dogecoin piqued your interest.
The first thing you should know about crypto is that you have thousands of options: 4,833 to be precise, according to CoinMarketCap. Most of them are not worth your time, but if you are savvy you may be able to find a climber to help you shoot you to the moon.
The best cryptocurrency to invest in
Remember not to invest more than you can afford to lose to keep your missile running out of fuel. This is especially true for investments in risky cryptocurrencies. However, if you are interested in trying something new, here are the 10 best cryptocurrencies to invest in according to market capitalization.
It is not uncommon these days to find ATMs while you are wandering over to BTC, the epitome of crypto. In fact, it was the first cryptocurrency to be introduced. There is only 21 million BTC that can be created and only about 18 million have been found so far.
This scarcity is what drives the market for BTC along with the fact that it is so well known. Even your grandmother has likely heard of Bitcoin, although explaining how it works could be a different story.
It has also drawn a lot of attention from notable investors like the Winklevoss twins (who Mark Zuckerberg stole the idea for Facebook from) who tried to start a BTC ETF but were ultimately turned down.
Bitcoin is based on the idea of limited supply, but with Ethereum it’s the opposite. You can buy, sell and trade ETH through a crypto broker like Coinbase, but it is also used to run certain decentralized applications like apps (called dapps). It is also a safer payment method as your details cannot be stolen and payment is not released until both parties are happy with the transaction.
As an investment, Ethereum has seen rapid growth since late 2020. It also saw a massive surge in value in 2018, only to crash afterwards.
Binance Coin (BNB)
Binance is a whole platform in itself that uses Binance Coin (BNB) as its currency. You can buy, sell and trade BNB yourself, but you can also use it as a payment method for the Binance ecosystem.
As with many other cryptos, the value of BNB has skyrocketed in recent months. Interestingly, Binance maintains a shortage for its currency by actually “burning” it once a quarter.
Crypto is known for some wild fluctuations in value. If this scares you but you are still interested in diversifying with blockchain technology, consider using Tether as the best cryptocurrency to invest in.
It is actually backed by bank reserves and pegged to currencies such as the US dollar or the euro. In fact, its value has been more or less a flat line over time. It’s basically a different way to invest in government issued currencies, but in a digital way that allows you to avoid fees from financial institutions.
XRP was introduced to speed up transactions and reduce the cost of international payments. It only takes three to five seconds for transactions to complete, and it can even process two different currencies without converting first.
XRP has also seen some very large fluctuations in value, rising from 24 cents in early December 2019 to $ 3.15 a few weeks later before falling back to its previous levels. It’s up and running again and it will be interesting to see how long this lasts.
Older cryotos like BTC use a lot of energy to make. Cardano Ada (named after Ada Lovelace) is one of the first cryptos to broadly address this problem, with the aim of being the most environmentally friendly crypto you can buy.
It is based on the Ethereum model where it is used in smart contracts, but you can also buy, sell and trade it as you normally would.
Bitcoin may have been the first cryptocurrency, but Dogecoin’s claim to fame is to be an “internet currency”. It is specially designed as a secure and affordable payment method for online creators such as bloggers, podcasters and Twitch streamers. You can even send and earn Dogecoin as a tip to help the Dogecoin Reddit community or to volunteer computer space for protein folding projects.
Dogecoin has been in the news a lot lately because of its meteoric rise, but it is still not viewed as an investment grade material by most of the people. It’s a meme based crypto, after all. But that doesn’t have to stop you from playing around a bit – but as always, don’t invest more than you can afford to lose.
Cryptocurrencies use blockchains, but what if you could create your own blockchain and control everything? That is the premise behind polkadot. It is an open source system that enables cross-chain transfers. It was developed by the nonprofit Web3 Foundation to decentralize things and make it harder for individuals and companies to control things.
Unit exchange (UNI)
Uniswap is another cryptocurrency designed to decentralize financial systems. It’s a token that uses the Ethereum exchange network and made waves in September 2020 when Uniswap mysteriously dropped 400 UNI tokens worth $ 800 ($ 12,000 in today’s value) into people’s wallets . If you believe in decentralized cryptocurrency support, this could be a great option for you.
Litecoin is one of the older cryptocurrencies that was introduced in 2011. It offers many of the same features as the other, newer cryptocurrencies on this list (fast transactions, cheaper to use, etc.), making it a bit dated.
Its founder – Charles Lee – has even completely separated from his Litecoin, which does not promise good trust in this crypto. Still, it is enjoying a minor revival.
Use BlockFi to grow your investment
Regardless of which cryptocurrency is best for you to invest in, you should consider opening a BlockFi account. This trading platform offers an exceptional suite of features that its competitors don’t, including:
- Up to 8.6% APY interest on your holdings
- Loans covered by your cryptocurrency from 4.5% APR
- Credit card with 1.5% cashback in BTC (currently on the waiting list)
You can grow your wealth by making smart investment decisions about how much of which crypto to buy and when. But by keeping your investment in a wallet like BlockFi, you can really help grow your investment even further, and that’s ultimately where you start investing in cryptocurrency.