Best Cryptocurrency To Invest In

In the midst of the global digital currencies frenzy, the most logical question you might ask yourself is: What is the best cryptocurrency to invest in now?

And you won’t be the only one looking for the answer. Everybody from the retail trader and the crypto enthusiast to big stock market players like funds and institutional investors is now turning the focus to the digital currency industry.

In the next few paragraphs, we will go through the best cryptocurrencies to invest in to help you on your quest for meeting your personal finance goals and finding the most profitable digital asset.

Keep in mind to use the best cryptocurrency brokers for your investment and trading activities.

Best Cryptocurrency To Invest In

According to the latest market data, there are over 11,000 cryptocurrencies. Over 3,000 are actively traded coins. This makes the digital currencies picking process a pretty challenging task.

Yet, just a small part of those cryptocurrencies really deserve your attention. So let’s take a look at some of the clear winners and help you find the best money-making opportunities within the blockchain technology niche.

1. Bitcoin BTC

We know it is the obvious choice, but nothing changes the fact that Bitcoin is the undisputed king of the crypto world, with the biggest market cap and dominance of over 65%. Think of it as the blue-chip cryptocurrency.

Many people ask themselves, is it worth investing in Bitcoin? Those who have the leading cryptocurrency in their portfolios, on the other hand, regret not buying more before.

The saying goes that the best time to invest in Bitcoin was yesterday, and the second best is now.

Of course, if you want to buy the dip, you can always wait a bit and rely on the asset’s historical volatility to bring the price lower. In the past, the price of the cryptocurrency has been hovering between $3,000 and $20,000 and all the way backs for the span of a few months. Now it crushed the $40,000 mark, so a future fall to lower levels is entirely possible.

In the end, it depends on your goal and whether you are in for the short- or the long-term.

Suppose you believe in the fundamentals of cryptocurrencies and their potential to be an alternative to the conventional financial system, as Satoshi Nakamoto proposed. In that case, Bitcoin is a worthy investment. In the end, it is the most established cryptocurrency and blockchain technology use-case, so don’t hesitate to consider it as the next constituent of your portfolio.

Last but not least, bear in mind that if financial institutions like hedge funds, asset managers, or banks like JP Morgan are considering Bitcoin as a high-potential opportunity and a worthy alternative to stocks, then rest assured, you are on the same page with the world’s best.

Make sure to consider also the different versions of Bitcoin, including Bitcoin Cash and Bitcoin SV.

2. Ethereum ETH

Ether makes it to the list not because it is the second cryptocurrency by market capitalization (although this is a valid reason) but because of its fundamentals.

The leading altcoin takes Bitcoin’s concept a step further. Rather than decentralizing money, it aims at decentralizing the whole Internet by creating a global system of nodes, resulting in a “single computer” for the entire world.

Ethereum is a whole ecosystem that was among the main reasons for the crypto industry’s lightning-fast development. The blockchain allows even beginners with little understanding to build decentralized projects. It is considered a cornerstone of the decentralized financial system that many dream of and is often referred to as “The King of DeFi.”

An upgrade called Ethereum 2.0 was recently introduced, which drove the asset’s price to the sky.

Ethereum is a worthy investment because it is designed with a real purpose – to serve as a foundation for the further development of the crypto industry and the technologies within. Think of it that way, if there were no Ethereum, many of today’s best crypto apps wouldn’t be here. Among the most popular Ethereum-based projects are Metamask, OmiseGO, MakerDAO, Augur, Trust Wallet, and many others.

If you are wondering whether Ethereum is worth it, then think of it that way – should the cryptocurrency industry is expected to continue its rise, Ethereum would be among the main reasons for that.

3. Litecoin LTC

Launched in 2011 by Charlie Lee, LTC was dubbed “the silver to BTC’s gold.” The idea of Litecoin was to reshape the idea of cross-border payment networks. The employed technology is just like Bitcoin, except that it is quicker and requires fewer resources. Alternatively – think of the asset as a “lite” version of Bitcoin.

Litecoin is favored by developers as well as an ever-increasing number of merchants, adopting cryptocurrencies as payment. It is worth considering as an investment as it has never left the list of the top 10 most popular digital currencies.

Short-term market experts’ projections point out prices of up to $600 by the end of 2021 ($147 at the time of writing). However, make sure to take all those cryptocurrency price predictions with a grain of salt. For example, Bitcoin was poised to hit the $50,000 and $100,000 mark several times already, but we are yet to see it.

So, getting back to the analogy of gold and silver. Consider Litecoin as an investment opportunity if you can’t afford to properly invest in Bitcoin (i.e., people who don’t want to pay the price of investing in gold, simply buy silver). Both cryptocurrencies are highly correlated, which means buying LTC will allow you to benefit from a potential boom in BTC’s price.

4. Basic Attention Token BAT

The token can be best described as one of the pioneering assets for the new Internet economy. It was developed by one of Mozilla Firefox’s co-founders. Its idea is simple – BAT is the new token for the digital advertising industry. It pays publishers for their content and users for their attention while providing advertisers with more in return for their ads.

That is why many experts believe that considering the crypto industry is here to stay. BAT is only poised to grow. As the digital economy evolves and more people start using cryptocurrencies, BAT will be the dominant medium of exchange for Internet users.

Another enabler for BAT’s rise is its integration into the Brave browser – the Chrome alternative in the new-age digital world. Since it became the main currency within Brave’s private ad platform, BAT has enjoyed over 7m daily active users and had become an approved currency for more than 1m verified content creators from all around the world. Among the portfolio of publishers enjoying the benefits of BAT are the likes of The Guardian, Vimeo, and Khan Academy.

Currently, BAT is considered among the most successful cryptocurrency projects to date.

Suppose you share the belief that the digital economy is poised to grow and the entertainment industry will be dominated, at least partially, by cryptocurrency payments. In that case, you can also consider one of BAT’s indirect rivals – the P2P network service provider TRON. The project was originally launched on the Ethereum blockchain with the goal to disrupt the entertainment industry and improve the user experience.

TRON partners with high-profile organizations like Samsung, Baidu, and more. Thanks to the rise of distributed applications, in 2020, TRON generated higher transaction volume even than Ethereum. However, it is worth noting that the instrument is quite volatile (partially thanks to its extravagant founder, Justin Sun) and more suitable for speculators.

5. Chainlink LINK

Before focusing on the asset, we should say a few words about the Chainlink decentralized oracle network. It ensures the secure connection of Ethereum-powered smart contracts with third-party apps, including data sources, APIs, payment systems, and more. Alternatively – to connect the blockchain to conventional solutions from the “everyday life.”

So, what is so special about this? By design, smart contracts can’t communicate with external systems. This creates the need to use oracles. They serve as a bridge between the smart contracts on the blockchain and the real-world events. That way, the blockchain is connected with the “off-chain” world. The main goal – to ease the mainstream adoption of cryptocurrencies.

In a nutshell – the company solves a pretty important problem within the world of cryptocurrencies. Despite being launched in the middle of 2019, Chainlink has achieved exponential growth and is most of the time within the top 10 largest coins by market cap.

Today, the company partners with market leaders like Oracle, SWIFT, and Google Cloud.

So, where is LINK in the whole picture? The Chainlink system pays data providers in LINK for ensuring the validity of the information that triggers these smart contracts. That way, the company managed to increase its token usability, minimize the risk of its network, and create a better experience for its users.

How To Choose the Best Cryptocurrencies To Invest In

No cryptocurrency market analysis will manage to provide an accurate buy and sell analysis and cover all the high-potential crypto investments since the industry develops at an extreme pace and new coin offering opportunities arise almost on a daily basis. So, before you decide to rush to your preferred cryptocurrency exchange or trading platform, there is some useful information that can help you when investing.

We will close with several pieces of advice on what to look for when choosing the best cryptocurrency to invest in:

  1. Choose assets with real purpose, not the headlines of the day.
  2. Research the team behind the project and the reputation of the founders.
  3. Study their historical performance and significant events, driving their price.
  4. Invest in liquid cryptocurrencies so that you aren’t locked in your position and suffer from the volatility.
  5. Keep an eye on Bitcoin’s performance – it is detrimental for the whole market and the price of the altcoins you have invested in.
  6. Don’t be afraid to cash out if things go wrong. The case with Ripple (XRP) showed that no asset is too big to fail.
  7. Keep track of Tweets and social media activity. Often, just a single tweet by prominent figures like Elon Musk or John McAfee can affect the price of your cryptocurrencies.

Lastly, bear in mind that investing in cryptocurrencies is very different from buying stocks. It is essential not to get carried away about the performance of your portfolio. Keep your feet on the ground and remind you that not every new project will be the next Bitcoin.

Updated: January 16, 2021

About the author: Alexander is the founder of daytradingz.com and has 20 years of experience in the financial markets. He aims to make trading and investing easy to understand for everybody, and has been quoted on Benzinga, Business Insider and GOBankingRates.