Top 5 Altcoins for Crypto Investors
Crypto investors have a wide range of choices when investing. With over 6,000 cryptocurrencies on the market today, it can be hard to determine which altcoins are worthy investments. While none of these altcoins are as valuable as Bitcoin right now, many of them have scaled new heights in recent months and represent great opportunities for investors looking to diversify their portfolios.
In this article, we will go over the top 5 altcoins for crypto investors and explain why they should be on your radar. These aren’t ranked in any particular order, so check out the list and see if there’s anything that sounds interesting to you!
But before we begin, let’s explain what an altcoin is.
Altcoins are blockchain-based alternatives to Bitcoin. The general rule of thumb is that if it’s not Bitcoin, it’s an altcoin.
Altcoins can be classified into 3 types:
- Stable coins
- Meme coins
- Utility coins
Stable coins, as their name suggests, are cryptocurrencies designed to maintain a stable value. Imagine if you could buy and sell your altcoins without having to worry about whether they’re going up or down — it would take away much of the risk associated with cryptocurrency investing. This type of digital currency is known as a stablecoin.
Meme coin is a coin that has a meme on it. Like internet memes, meme coins do not have any real purpose aside from making fun of the current wave of cryptocurrencies or financial systems. As such, there may be more risk involved with investing in meme coins than there is with other types of altcoins. Memecoins capitalise on its virality — be it through word of mouth, online chatter or even news — to create value.
Utility coin is an asset or utility token created to be used within a business’s specific ecosystem. They can also be referred to as customer tokens or user tokens. The purpose of utility coins is to enable customers to buy and sell goods, services, or assets within a blockchain-based platform. Each of these coins have unique properties that make them useful in their own way.
Without further ado, here are the top 5 altcoins for crypto investors:
- Cardano (ADA)
Cardano is a decentralized proof-of-stake (PoS) blockchain platform designed to be a more efficient alternative to proof-of-work (PoW) networks. Cardano’s market value is at around $94 billion. Its Ada token has risen about 1,420 percent year to date, propelling it to the third-largest cryptocurrency in terms of market valuation, after only Ethereum and Bitcoin.
According to Coindesk, Cardano hit an all-time high of $2.58 this August, an increase of more than 18 percent. Year to date, it has seen returns of 1,294 per cent recording a recovery of $82 billion, in the process surpassing Binance coin and securing the third position.
- Tether (USDT)
Tether (USDT) is a stable coin that intends to be the cryptocurrency counterpart of the US Dollar, as its name suggests. This enables it to be traded on a variety of crypto exchanges with a relatively steady value – 1 USDT will always be US$1, whereas 1 Bitcoin (BTC) can fluctuate between US$60,000 and US$40,000 in a single day.
You can buy Bitcoin with Tether, but instead of paying with cash or another cryptocurrency, you pay with USDT. This way, instead of the fluctuating value of BTC or any other cryptocurrency, you always pay the same transaction cost.
- Ripple (XRP)
Ripple (XRP) is a utility coin, intended for use on the Ripple network to accelerate currency exchanges. It’s similar to why Binance Coin is such a popular cryptocurrency to use to purchase other cryptocurrencies. However, XRP can be used to exchange various fiat currencies as well as some major cryptos. Its use will only grow in importance over time. Unlike many of the fraudulent cryptos out there, fiat currency will be around for a long time. And the ability to exchange it for others will become more important as the world becomes more interconnected.
- Dogecoin (DOGE)
Dogecoin (DOGE) is a meme coin created solely to mock Bitcoin, demonstrating how much of Bitcoin’s value is based on media hype.
Whereas Bitcoin derives most of its value from the media, Dogecoin (DOGE) derives the majority of its value from social media clout, which generates dialogues and virality. Its holders are working hard to increase its worth to $1, but even during the crypto boom in May and July 2021, it has not risen past $0.75.
- Binance Coin (BNB)
Binance Coin (BNB) is a utility token meant to be used exclusively in the Binance ecosystem. Its main use is to offer lower transaction fees when trading cryptocurrencies on the international exchange, but it has other uses like participating on other token sales or even paying for games or apps hosted on the Binance platform.
Binance coin competes directly with Cardano. Simultaneously, the decreased volume of Cardano staked implies a drop in trader interest. If the decline continues, BNB will have a better chance of regaining market capitalization and supplanting Cardano as the third-largest cryptocurrency.
Which altcoin should I invest in?
This largely depends on your risk appetite. In order for crypto values to rise, their networks’ adoption rate will need to increase, which will take time. They each, however, may have long-term potential.
You can invest in Dogecoin if you want to make a fast, speculative buck, as its value is totally speculative and depends on news and social media, hence you’d have to actively monitor it. Just keep in mind that you should only put in sums that you can afford to lose.
Various cryptocurrencies are widely accessible on cryptocurrency exchanges like Binance Singapore, but make sure to compare the transaction costs between these crypto exchanges.
As always, UKISS recommends that you limit your crypto investments to a modest portion of your portfolio, while balancing their risks with safer, more established vehicles such as stocks and ETFs. Never invest more money than you can afford. You may also want to learn the 5 smart crypto investment strategies.
Do you know someone who might find this article useful? Share this knowledge with them!
About UKISS Technology
UKISS Technology is pioneering the next-generation cryptosecurity wallet that is simple, safe, and secure to use. Their technology has also been granted patents in most major markets including China, the United States, Europe, Asia, and India. Their clients include government ministries, leading medical healthcare providers based in the APAC region, and major FinTech players. Stay tuned for more information.