A cryptocurrency (or "crypto") is a digital currency that can be used to buy goods and services but uses an online ledger with strong cryptography to secure online transactions. Much of the interest in these unregulated cryptocurrencies is to trade for profit, with speculators at times driving prices skyward. The most popular cryptocurrency, bitcoin, has had volatile price moves this year, reaching nearly US$65,000 in April before losing nearly half its value in May. By mid-October, the price had risen rapidly again: it hit an all-time high above US$66,000 before falling back.
There's absolutely no surprise whatsoever that Bitcoin (CRYPTO: BTC) still reigns as the world's most popular cryptocurrency. Its market cap currently stands at nearly $1.1 trillion. If Bitcoin were a company, it would be bigger than Meta Platforms (formerly known as Facebook) and Tesla. Bitcoin continues to enjoy the advantage of being the first cryptocurrency. It's more widely accepted than any other digital coin, mainly because it's been around longer. Bitcoin is even viewed by some investors as a good hedge against inflation since there will never be more than 21 million Bitcoin tokens in circulation.
Ethereum (CRYPTO: ETH) ranks as a somewhat distant No. 2 to Bitcoin on the list of the most popular cryptocurrencies. Its market cap is hovering around US$500 billion, less than half the size of Bitcoin. But some believe that Ethereum will be the next Bitcoin. The key edge for Ethereum is its real-world utility. Its blockchain supports smart contracts that can be used in a wide range of applications. In particular, Ethereum is well-suited for creating non-fungible tokens (NFTs). Whether or not the cryptocurrency knocks Bitcoin out of the top spot in the future, Ethereum appears to be in a good position to stand the test of time.
Binance operates the biggest cryptocurrency exchange in the world. It makes sense, therefore, that Binance Coin (CRYPTO: BNB) is the third-most-popular digital coin on the market. It's the native coin on the Binance exchange and currently has a market cap of over $96 billion. Investors who pay transaction fees with Binance Coin receive discounts. Each quarter, Binance reduces the supply of digital coins based on trading volume. Over time, these quarterly coin "burns" will remove 100 million coins, which amounts to half of the total supply. These moves are intended to increase the value of Binance Coin.
Tether (CRYPTO: USDT) ranks as the No. 4 most popular cryptocurrency in the world. Its market cap is around $73 billion. But among stable coins, Tether takes the top spot. All stable coins tie their value to another asset. For Tether, that asset is the U.S. dollar. In theory, Tether is like a "crypto-dollar" that should maintain its value in a similar way as physical U.S. dollars do. However, there has been some controversy over whether or not Tether has sufficient reserves to back all of its digital coins. The U.S. Treasury Department recently called on Congress to take action to address the risks that could be posed to the economy by stable coins such as Tether.
Solana (CRYPTO: SOL) rounds out our list of the top five most popular cryptocurrencies. Its market cap currently stands near US$65 billion. Solana has been the biggest winner of these top cryptocurrencies over the last year with a gain of well over 10,000%. Many investors have flocked to Solana as an alternative to Ethereum. Both blockchains support smart contracts. However, Solana offers much faster processing speeds and lower transaction fees than Ethereum.
Avalanche, along with Solana, is another example of a crypto that has a clear purpose, as opposed to meme coins like Dogecoin, which have no purpose at all. Avalanche is one of the many projects seeking to "unseat Ethereum," as one of the most widely used blockchain platforms, according to the cryptocurrency exchange Gemini. A Blockchain, part of the technology underlying cryptocurrencies, stores information — like the history of cryptocurrency transactions — in a way that ensures no one individual or group has control of that information. Ethereum is the most-used blockchain network. A US$220 million fund was just launched to fund the development of Avalanche, which boasts of much faster transactions than Ethereum (4,500 transactions per second versus Ethereum's roughly 13 per second).
Want to quit your day job and play video games to make money? Well, technically, you can. In the game Axie Infinity, players buy monsters and have them fight one another to win tokens, which can then be turned back into real money. During the pandemic, many Filipinos turned to play into their full-time jobs.
Meme coins rely on internet hype and therefore it's near impossible to predict which ones will take off. But the meme coin Samoyedcoin has piqued the interest of Daniel Polotsky, founder of CoinFlip, a Bitcoin ATM company. Like Dogecoin, it bears the face of a cute dog and is intended to be a lighthearted and fun ambassador for Solana.
Fetch.ai is a decentralized machine learning platform for applications like asset trading, according to CoinBase. For example, one of Fetch.ai's applications helps users of the crypto exchange Uniswap automate their trading. FET is an Ethereum-based token that powers Fetch.ai. It's gained more than 1,500% in the last year. Fetch.AI is using its technology to back real-world applications, says Ahmed Shabana, managing partner for Parkpine Capital.
USD Coin (USDC) is a type of cryptocurrency that is referred to as a stablecoin. You can always redeem 1 USD Coin for US$1.00, giving it a stable price. On Coinbase, eligible customers can earn rewards for every USD Coin they hold. Each USDC is backed by one dollar or asset with equivalent fair value, which is held in accounts with US-regulated financial institutions.
Join our WhatsApp Channel to get the latest news, exclusives and videos on WhatsApp
_____________
Disclaimer: Analytics Insight does not provide financial advice or guidance. Also note that the cryptocurrencies mentioned/listed on the website could potentially be scams, i.e. designed to induce you to invest financial resources that may be lost forever and not be recoverable once investments are made. You are responsible for conducting your own research (DYOR) before making any investments. Read more here.