Cryptocurrencies have swiftly risen to a considerable position over the past decade. Cryptocurrencies are digital currencies that aren’t regulated by a centralised system or a government.
Crypto owners use these currencies for making purchases, but most people regard it as a long-term investment. However, the market’s high volatility makes it a risky investment, as evidenced by the significant fluctuations in the prices of various cryptocurrencies on Coin Watch.
This article aims to introduce beginners to crypto investing, shedding light on six promising coins that could be a great starting point.
1. Bitcoin (BTC)
Bitcoin is the pioneer of cryptocurrencies and understandably, the most established one of all. It has a market cap of approximately $525 billion, taking up nearly 46% of the entire crypto market.
However, the cost of a single Bitcoin standing at nearly $30,000, can deter newbie investors.
2. Ethereum (ETH)
Ethereum, the native token of the Ethereum blockchain, commands the second-largest market cap in the crypto world at around $230 billion, accounting for about a fifth of the total cryptocurrency market. It is particularly popular for its smart contracts and decentralized finance (DeFi) applications.
Its recent transition from the energy-intense proof-of-work protocol to the more efficient proof-of-stake system gives it an edge over Bitcoin in a highly eco-conscious world.
3. Avalanche (AVAX)
Avalanche, a relatively new “layer one” blockchain, was founded as a competitor to Ethereum. Avalanche’s individual blockchains can validate transactions independently, making it scalable and capable of handling large volumes of transactions — up to 6,500 per second. This has made Avalanche increasingly popular among Ethereum projects.
However, given that Avalanche was introduced via a white paper in 2018 and launched in 2020, it does not have a long track record for comparison, which makes it a riskier buy for potential buyers.
4. Polygon (MATIC)
Polygon is a scaling platform designed to enhance the capabilities of the Ethereum network. It aims to allow Ethereum to eventually run a potentially limitless number of decentralized applications (dApps).
Polygon’s layer-two solution is designed to overcome Ethereum’s speed issues. However, Ethereum’s Merge upgrade could eventually result in faster transaction speeds than Polygon provides, eliminating Polygon’s primary advantage.
5. Cardano (ADA)
Founded in 2017 by Ethereum co-founder Charles Hoskinson, Cardano is a proof-of-stake blockchain that is one of the largest blockchains to successfully use this more energy-efficient protocol.
Cardano aims to foster a developer-friendly ecosystem for dApps. But even with a better network and the increased functionality that smart contracts provide, Cardano may not be able to compete with larger cryptocurrencies. Fewer adopters mean fewer developers, which isn’t appealing to most investors.
6. Cosmos (ATOM)
Cosmos seeks to make inter-blockchain communication easier, faster, and affordable for both coders and end-users. However, its success relies on the widespread acceptance and usage of multiple blockchains.
In Conclusion
The allure of potentially high returns and the thrill of participating in a groundbreaking financial revolution makes crypto investing an irresistible endeavor. But as a newbie, you must familiarize yourself with the intricate details of the crypto market before making the plunge. The six coins highlighted in this column should serve as a great starting point.
