How To Decide Which Cryptocurrency To Buy (2021)

Considering the incredible gains witnessed by investors, there is no better time than the present to start investing in cryptocurrency. Whether you’re looking to build your portfolio from scratch or add a few new ones to your already established one, we are here to help. With over 8,400 cryptocurrencies available, we’re going to help you establish how to decide which cryptocurrency to buy.

Advantages Of Cryptocurrency

Before we dive into the individual cryptocurrencies and take a look at what they offer, let’s first cover the universal basics. When investing in anything it is worth taking the time to understand the product and become aware of the benefits and risks involved. Below is a quick breakdown of the three top advantages of cryptocurrency:

Decentralized. First and foremost cryptocurrency is designed to offer a payment system that is free from government or bank involvement. Cryptocurrencies, while individually they might vary, are operated by a network of nodes around the world. These nodes are responsible for maintaining the network and work collectively following predetermined protocols. No one entity has the power to shut down a cryptocurrency.
Scarcity. Most cryptocurrencies have a limit on their total supply. This works in a deflationary manner to ensure that the price increases over time as demand goes up and supply goes down.
Cross border transactions. When looking to make cross border transactions, cryptocurrency, and in particular Ripple, offers a cheaper and faster means of doing so. Cryptocurrencies offer the perfect bridge between countries as their transaction fees are minimal and both parties can effortlessly convert the cryptocurrency to their local fiat.
Technological innovation. Beyond the incredible powers of a digitized, decentralized payment system sits the technology facilitating it. Blockchain technology has proven to be the greatest innovation of the last decade as more and more corporations look to incorporate the technology into their businesses to help streamline and improve operations.
Divisible. While each cryptocurrency varies in how divisible it is, in general cryptocurrencies can be broken down into smaller fractions to enable more investors to buy in (without spending $30,000) and more transaction capabilities. Bitcoin for instance is divisible by eight decimal places, enabling someone to buy a hundredth of a millionth of the coin, known as a satoshi (1 satoshi = 0.00000001 BTC).

How To Decide Which Cryptocurrency To Buy

We’ve compiled a list of top cryptocurrencies that offer a strong investment value, categorised to help you understand their potential. Traders can take a look at the list to determine which cryptocurrency best suits their investment portfolio, and which ones to do more research on.

Highest Adoption Rates: Bitcoin (BTC)

As the original cryptocurrency, Bitcoin holds a large share of the entire crypto market capitalization (+60%). Bitcoin was launched in 2009 and has since built up a market cap of over $800 trillion. The cryptocurrency is used both as a store of value and a method of payments and has the highest adoption rates of all the cryptocurrencies.

Over the past few months, Bitcoin has seen an unprecedented increase in institutional investments and has soared to great heights breaking one all time high after the next. As Bitcoin leads the way in crypto market trends and holds the highest adoption rates, it is a must-have in any investor’s portfolio.

Most Versatile: Ethereum (ETH)

Considered to be the most used blockchain network, Ethereum claims the title of most versatile. The platform was designed to offer developers a place to build decentralized applications (dapps) and smart contracts. Ethereum is currently ranked as the second largest cryptocurrency based on market cap.

Aside from the incredible versatility, the platform also offers a foundation on which companies can build their own cryptocurrencies. Ethereum has a number of different token standards that can be created to fulfil a variety of needs, i.e. Tether, currently ranked number three in cryptocurrencies based on market cap, is an ERC-20 token. The entire DeFi industry is also built on top of Ethereum.

Fastest Transactions: Ripple (XRP)

Ripple was built to offer very fast, very cheap international money transfers. The platform can execute 1500 transactions per second, while the next fastest cryptocurrency can only do 60 transactions per second (Bitcoin Cash). Ripple is currently building relations with banks and payment processors in order to execute international fiat trades faster and more cheaply. While some see this as a betrayal on the nature of cryptocurrency, others view it as a pioneer in bridging the gap between blockchain and traditional financial worlds.

Ripple is currently trading at a much lower price than its other top 5 competitors making it an easy market entry point. Ripple has also been accoladed with having one of the best leadership teams in the crypto space.

Closest Alternative To Bitcoin: Bitcoin Cash (BCH)

Bitcoin Cash was created in 2017 when the Bitcoin community couldn’t agree on a number of issues, particularly scalability. Bitcoin underwent a hard fork and Bitcoin Cash was created, only with bigger block sizes. The team increased the original Bitcoin block size from 1MB to 8MB, and later developers increased it again to 32MB. With this update, Bitcoin Cash is able to execute transactions more quickly and at a lower cost.

Looking to make a more economically free world through the use of a fast and reliable cryptocurrency, Bitcoin Cash has a strong roadmap, an excellent team of developers and designers, and a clear vision of what will come next.

Highest Growth Potential: Chainlink (LINK)

Chainlink entered the crypto space in 2014 as a decentralized oracle network assisting Ethereum smart contracts. The platform has created a means for smart contracts based on the Ethereum network to connect with outside data sources, payment systems and APIs. Another project connecting the blockchain and outside world, Chainlink has been welcomed to wide acclaim.

Trading at just under $30, Chainlink also offers a cost effective way to enter the crypto market. In 2019 Chainlink partnered with Google to implement their protocol into Google’s smart contract strategy. Again, this partnership has been viewed as a positive step forward for both Chainlink and cryptocurrency in general, earning it the “highest growth potential” position.

Payments Driven Bitcoin Alternative: Litecoin

Launched in 2011, Litecoin is widely known as the silver to Bitcoin’s gold. The cryptocurrency was created by a former Google employee and MIT graduate and was the first and arguably most successful fork of the Bitcoin blockchain. Litecoin has consistently been one of the top ten cryptocurrencies by market cap.

Litecoin opted to use a different type of algorithm to add transactions to blocks which resulted in a faster block generation rate, meaning faster transaction times. Early investors have seen a return on investment of over 4000% over the past several years. The cryptocurrency currently has 66 million coins in circulation, with a max supply of 84,000,000.

Privacy Coin: Monero (XMR)

While cryptocurrency has a reputation for providing anonymous transactions, the truth is that most of these transactions are in fact pseudonymous. This means that anyone can identify the sender or recipient if they already know the wallet address. Monero breaks this mould by offering a completely private and untraceable payment network through the use of “ring signatures”.

The platform was launched in 2014 and has been well received by most of the cryptocurrency community. While Monero has garnered a reputation for being used for illicit transactions on the darknet, it is also widely used for and amongst renegades fighting against oppressive regimes. Monero is currently trading at around $180 and is just outside of the top 20 cryptocurrencies by market cap.

Best Ethereum Alternative: Cardano (ADA)

Launched in 2015, Cardano was the creation of Charles Hoskinson, one of the original five founding members of Ethereum. Cardano was created by mathematicians, engineers, and cryptography experts and meticulously built through peer-reviewed research and extensive experimentation. With this research in mind, the platform operates off of a proof of stake consensus and is a leader among the other PoS networks.

While Cardano is still in its early phases of development it has managed to amass a $26 billion market cap and a position among the top 5 cryptocurrencies. The platform aims to be a stand out financial operating system through the creation of its own DeFi products, chain interoperability, legal contract tracing, and more.

Ethereum Rival: EOS (EOS)

Similar to Ethereum, EOS offers developers a platform on which to build decentralized apps and smart contracts. The platform’s main objective is to offer developers around the world easy access to blockchain technology. In doing so, EOS offers them tools and educational resources to assist them in their creations.

EOS has a number of advantages over its competitors including zero transaction fees and less volatility than other cryptocurrencies. It is also one of the most traded coins on the market. Having only launched in 2018, EOS has built up an impressive market cap as well as reputation. EOS currently has 950 million coins in circulation of the 1,02 billion tokens (max supply). If the project continues developing the way it is, it is likely that the demand for EOS will increase (along with the price).

Building A Cryptocurrency Portfolio

Get started with as little as $20 and easily buy Bitcoin, Ethereum and other cryptocurrencies using a wide range of payment options, including bank transfer, credit or debit card on Oobit.

Once you complete the purchase, you’ll see the new crypto in your Oobit wallet – a safe and simple way to manage your crypto assets. You can immediately trade your purchased crypto on the many products and services on the Oobit Platform.

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