According to Forbes, there are almost 22,000 cryptocurrency projects out there, representing the entire £697 billion crypto market. The number is incredible, and it doesn’t seem to stagnate here.
From Ethereum to Tether, there are thousands of cryptocurrencies, making it overwhelming to pick the best one to invest in. And since past performances can help, they can’t guarantee how the chosen digital coin will perform or which should be held long-term.
There are cryptocurrencies like Bitcoin and Ethereum, which traders choose to store for an extended period hoping for a good ROI. If you want to do the same and wonder how to buy Ethereum, there are some steps to follow. After registering on a widely-used and reputable platform like Binance, you choose between several purchasing methods and then determine how you’ll store your ETH. Be mindful of the amount you’ll buy, and only invest what you can afford to lose, especially if you lack experience with cryptocurrencies.
For a more diversified investment portfolio and to help you get started, here are some of the most popular cryptocurrencies by market capitalization right now.
Amid market volatility, Bitcoin, a breakthrough in cryptography and the first successful crypto project created in 2009, keeps being a go-to for investors worldwide. It runs on blockchain technology, just like many other digital coins, which logs the transactions executed across the system in a digital ledger. Bitcoin is kept safe from fraudsters because updates to the distributed ledger must be confirmed by solving a cryptographic equation – a process known as ‘proof of work’.
Its price has skyrocketed as it’s become a household name. In May 2016, you could buy one for about £370. Nowadays, its price is around 3,650% higher. Since its mysterious inception, as Satoshi Nakamoto has created it, but it’s unknown whether it’s a group of developers or only one individual, Bitcoin has been on a roller-coaster ride. However, it was in 2017 that it broke into popular consciousness, inspiring other tech enthusiasts to give life to other crypto projects.
As both a blockchain platform and a cryptocurrency, Ethereum is an all-time favourite. Thanks to its potential applications like non-fungible tokens (NFTs) and smart contracts that execute automatically when conditions are met, it is also a soft spot for programmers. NFTs are digital assets representing real-world objects, like unique art, music, and drawings.
Ethereum is another digital coin that’s seen rapid growth, starting from £8 in April 2016 and hitting £1,000 and more.
According to Analytics Insight, it’s among the top cryptocurrencies in 2023 and a favourite, as its value has risen significantly since 2021 and is seen as relatively stable compared to other cryptocurrencies. For this reason, if you’re looking to capitalise on gains and expand your collection through digital coins, starting with a giant one can be a sound decision.
Tether has a market capitalization of 55 billion pounds. It is a type of “stablecoin”, unlike some of its cryptocurrency rivals—this kind of coin attempts to peg its value to an external reference. For Tether, this means it’s backed by “fiat” currencies like the Euro or the British pound, hypothetically keeping a value equal to one of these denominations.
Because established currencies support this crypto, its value should be more constant than other cryptocurrencies, which is why investors who are wary of the high volatility surrounding other cryptocurrencies favour this asset.
U.S. Dollar Coin (USDC)
USD Coin (USDC) is a stablecoin like Tether. It is a fiat-collateralised stablecoin backed by the U.S. dollar and redeemed in a 1:1 ratio against dollars. Despite its name, it’s essential to know that USDC isn’t backed or issued by the U.S. government. It is an open-source project, meaning anyone can view and contribute to its code. It has a market cap of £37.2B.
USDC is compatible with some blockchains, including:
Owning this cryptocurrency during periods of high market volatility can help stabilise a portfolio’s value.
Binance Coin (BNB)
Binance Coin (BNB) is the cryptocurrency issued by the world’s largest cryptocurrency exchange, Binance. It was initially based on the Ethereum network but is now Binance’s own blockchain’s native currency. Every quarter, the platform consumes 1/5 of its profits to rebuy and permanently destroy BNBs held in its treasury. This cryptocurrency was designed in 2017 as a utility token for discounted trading fees before its uses expanded to various other applications, like:
- Payments for transaction fees on the Binance chain
- Financial services
- Online services
- Travel bookings
By January 2023, its price grew to around £204, and its market capital hit £32.6B.
XRP can be the quickest and most cost-efficient cryptocurrency for cross-border trade, and it holds the credit for trading multiple currencies over the network. XRP was developed by some of the same founders as Ripple and can be used on that network to improve exchanges of various currency types, including other major cryptocurrencies and fiat currencies.
Its price was £0.004 at the beginning of 2017 and reached around £0.29 at the beginning of January 2023, signalling an increase of about 7%.
Binance USD (BUSD)
Binance USD (BUSD) is a stablecoin founded by Binance and Paxos to create a digital coin backed by the U.S. dollar. Paxos holds some U.S. dollars equal to the whole supply of BUSD to keep this crypto’s value.
Binance USD allows crypto users and traders to conduct transactions with other crypto assets while minimising volatility risk. Its market cap in January 2023 exceeded £13B and is getting close to £14.
Dogecoin famously started as a joke in 2013 but became a prominent cryptocurrency thanks to meme creators and a dedicated community. However, since there’s no limit on how many Dogecoins can be created, this cryptocurrency can be susceptible to devaluation as supply grows.
In 2017, its price was £0.00016. By January 2023, its price grew by almost 37%.
Other popular choices can be Cardano (ADA), Polygon (MATIC), Dai (DAI), and Tron (TRX), among others. With so many options available, what cryptocurrency would you purchase if you were to get into crypto?