Cryptocurrencies, Digital currencies or digital coins are making headlines these days. Traders are shifting to the crypto market from stock, forex or other financial markets because of higher returns. This article will teach us about the most popular and fastest-growing digital assets with their key features. Before moving towards our main topic, let us have a quick overview of what cryptocurrency is and how it works.
Understanding the world of digital currencies
Cryptocurrencies are decentralized virtual currencies designed to work as a medium of exchange based on blockchain technology .
These currencies are neither issued nor controlled by the government or central authorities. All the crypto transactions are recorded in a ledger to ensure secure exchange and limited distribution to maintain the value of the digital assets.
Like any other financial asset, the value of digital assets keeps changing based on different factors, including demand, supply, adaptability, regulations, technology, etc.
Traders, in order to take advantage of price fluctuations, buy and sell crypto assets and make profits. If a trader believes that the price of a particular crypto will rise in the future, he will buy it, or if he believes that it will fall, he will sell the cryptocurrency.
Let us understand investing in cryptocurrencies with an example.
Suppose a person bought Bitcoin in 2015 at 430 USD, and now, at present, the value of one Bitcoin is around 28,945 USD, which means if he sells it now, the profit will be around 28515 USD.
In the above case, we have seen how the value of bitcoin saw a high jump in a couple of years. So investing or trading in crypto can be a great way to make money.
Most popular cryptocurrencies to invest in
There are more than 22000 cryptocurrencies in the world. However, not all cryptocurrencies are that popular. With the chances of making a high profit, you can also lose a significant amount if not invested in the right crypto.
We have prepared the most popular cryptocurrency list with their unique features, market cap and price at the time of writing. It will help you select the best crypto that suits your needs.
Bitcoin (BTC)
- Market cap: Over $500 billion
- 1 Bitcoin = 28,896 USD
The first word that comes to your mind when you hear crypto is Bitcoin, and the reason is its popularity. It is the first and most expensive cryptocurrency created by Satoshi Nakamoto in 2009.
Being first is not great, but maintaining the first position is great. The same is true with Bitcoin. It remains most dominant in terms of price, market cap and adaptability.
Bitcoin is based on blockchain technology. It has a supply limit of 21 million coins which means it cannot be mined more than this figure. All the transactions are properly recorded to maintain its value.
Over the years, we saw tremendous fluctuations in the price of Bitcoin. There was a time when it was not equal to even one USD. In 2021, it reached its all-time high of around 65000 USD, and at present, it is over 22000 dollars.
Ethereum
- Market cap: Over $ 220 billion
- 1 Ethereum = 1818 USD
Bitcoin is quite expensive to invest your money in, so if you are looking for its alternative, Ethereum is the best option. Many people believe that Ethereum will be the next big cryptocurrency.
It launched in 2015, and since then, it has become quite popular among investors. Ethereum also has its own platform to build and deploy smart contracts & decentralised applications. You can use Ethereum to pay fees and computational services on the platform.
Binance Coin
- Market cap: Over $50 billion
- 1 Binance Coin: 245 USD
Binance exchange is the most popular and widely used crypto trading exchange platform globally. The platform has its own cryptocurrency named Binance coin.
Traders can use these coins to buy or sell other cryptos, pay trading fees, or trade-in other financial assets. Also, you can get bonuses and discounts for trading using these coins.
Tether (USDT)
- Market cap: Over $80 billion
- 1 Tether = 1 USD
Major cryptocurrencies, including Bitcoin and Ethereum, are highly fluctuating. However, with high profits, the chances of unexpected loss are also high with these currencies.
So, short-term traders who want to trade in a less risky environment can go for tether. Tether is a stable currency that maintains the same value as USD. You can use this crypto for different purposes, and converting them into forex currencies is also comparatively easy.
Cardano (ADA)
- Market cap: Over $10 billion
- 1 Cardano= 0.31 USD
Cardano is amongst the most popular cryptocurrencies and provides a sustainable, scalable and secure infrastructure for developing smart contracts and decentralised apps.
The cryptocurrency was created after detailed research by experts, mathematicians, and engineers. This crypto is also known as an alternative to Ethereum due to its terrific blockchain technology and quality DeFi products.
XRP (XRP)
- Market cap: Over $23 billion
- XRP = 0.69 USD
XRP was created by Ripple Labs in 2012 based on decentralized technology. The main aim behind its creation is to facilitate fast cross-border payments at a low cost. You can use these currencies to exchange different crypto and traditional currencies.
The best part about XRP is many reputed institutions accept it for international remittances. Unlike other major cryptos, XRP’s 100 billion coins are pre-mined at inception and are supplied periodically in the ecosystem.
Dogecoin (DOGE)
- Market cap: $11 billion
- 1 DOGE= 0.0780 USD
While the above cryptocurrencies were created after detailed study and research, Dogecoin became popular because of a joke or social media meme.
Dogecoin is also known as meme coin. It was created by Billy Markus and Jackson Palmer in 2013. They used the Shiba Inu dog in their logo. It became excessively viral on social media platforms, due to which its price skyrocketed.
At present, it is amongst the most valuable cryptocurrencies. However, for a beginner, it is quite risky to trade in this crypto due to the absence of a supply limit and proper technology.
Polkadot (DOT):
- Market Cap: Over $9 billion
- 1 Polkadot= 5.17 USD
Polkadot was launched in 2016, and since then, it has been a popular choice for crypto traders. It has excellent multichain blockchain technology that facilitates interoperability and scalability.
You can use crypto for the transfer of financial assets and data. It also offers DOT holders the facility to participate in the decision-making process regarding the upgradation of the coin.
Wrapping Up
In the era of digitalization, the scope of cryptocurrencies is very wide. Many people believe that these digital coins will replace the forex currencies and become the prime medium of exchange.
However, at present time some countries have declared cryptocurrencies as illegal. Also, in countries where they are legal, the rules and regulations regarding the exchange are less stringent.
Cryptocurrencies are free from government interference and manipulations. However, the scams in the crypto market are also increasing. Trading in crypto can be a great way to achieve higher returns.
Still, it is essential to analyze a particular cryptocurrency’s history, security, technology, features, and price movement before putting your money in the market. For novice traders, it is advisable to go with the most reputed and popular cryptocurrencies to eliminate the chances of scams.
