Recent years have seen cryptocurrencies advance from obscure concepts with niche popularity to mainstream assets that are increasingly common among investors. This evolution was driven in part by bitcoin’s meteoric rise late in 2017 when the well-known crypto coin leaped to almost $20,000 in value (if only briefly). Since then, more people seem to be taking bitcoin and other cryptocurrencies seriously — particularly among millennials, who are increasingly trusting cryptocurrency even over the stock market.
Indeed, research in 2019 indicated that nearly half of millennials would prefer to invest their money in cryptos than in stocks — a fairly remarkable finding given the relative newness of cryptocurrency. This also introduces an interesting question though, which is what cryptocurrencies make for the most logical investments? While bitcoin undoubtedly leads the pack, a budding investment market can’t be sustained entirely by one asset. So in this article, we’re going to look at the handful of crypto options that appears to generate the most investment-related attention.
As noted, bitcoin leads the pack. It has the highest market cap and value (by far) among all cryptocurrencies and is the asset that tends to drive the headlines. It is also the asset that has generated legitimate fortunes for thousands of people around the world already. For these reasons, bitcoin can be a sort of magnet for crypto investors — the thing that drives them to the market, and the asset they’re most intrigued by. That said, there are some who still believe that bitcoin is too risky for the average investor, given its high price and burst “bubble” potential. We would say that it’s certainly a cryptocurrency worth knowing and considering, but that it should not be the only option prospective investors consider.
While it sounds almost too obvious, litecoin can fairly be described as “bitcoin lite.” It’s an extremely similar crypto token in terms of design and use, but it has far less value and a significantly lower market cap. While there are reasons to doubt its long-term potential to eclipse more robust cryptocurrencies, some investors like litecoin for its potential to follow the leaders. In other words, if bitcoin rises by 20%, litecoin might tend to do the same. This, coupled with the fact that it’s cheaper to invest in, makes it an interesting option.
Ethereum is also a long way behind bitcoin when it comes to value and market cap — but it’s much closer than litecoin, and indeed much closer than most cryptocurrencies. It appeals to investors for this reason, but also because it represents a slightly different technology that some credit with massive long-term potential. Ethereum is built to enable digital transfer functions, often called “smart contracts.” And some exact such functions to become exceedingly popular in the years to come, such that this crypto option becomes a busy foundation for all kinds of activity. It’s worth noting that ethereum now has several competitive cryptocurrencies that are capable of establishing similar systems. But generally, investors still value this option for function.
Ripple’s value pales in comparison to that of any of the coins discussed above. However, it has two things going for it among crypto investors right now. The first is that it’s trending in the right direction. Investors looking to trade Ripple have seen its price surge in recent months indicating that the enthusiasm around this crypto option in 2019 was well-founded, and it may well have the potential to keep going up. The second thing this particular option has going for it, meanwhile, is an immense market cap. Like ethereum, ripple is valued for its long-term potential as a functional asset (in this case helping to make international transactions smoother for banks and other major entities). And even if its value remains small, the market cap may indicate how many people are willing to buy into this potential.
An offshoot of bitcoin (in that it was literally a “forked” alternative that branched off of the original cryptocurrency), bitcoin cash is a bit of a strange asset to consider from an investment perspective. That’s because it was designed to be easier to spend than bitcoin — meaning it’s meant more to be money than to be an investable asset. Nevertheless, it is still tradable, and because it has one of the highest values among cryptos, it’s one that a lot of investors consider.
The list could go on well beyond these five choices, particularly when you consider stablecoins as well (meaning cryptos, like Tether, that are tied to concrete assets to stabilize value). But for those who are just beginning to explore the crypto sector, these are generally the options that first come up.