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Cryptocurrency is digital money that is not managed by a central system such as the government. Instead, it is based on blockchain technology, with Bitcoin being the most popular. As digital money continues to gain traction on Wall Street, more and more options are available. There are currently more than 5,000 cryptocurrencies on the market.
While you can use cryptocurrency to make purchases, most people treat it as a long-term investment. However, volatility makes investing in cryptocurrency quite risky, so it is important to know what you are going to get before buying. These are the eight best digital currencies worth investing in in 2022.
Top 8 Cryptocurrency Investments in 2022
|Cryptocurrency||the price||Market value|
|Binance coin||$525.85||87.803 billion dollars|
|Avalanche||USD 123.09||$29.937 billion|
|Data is accurate as of December 21, 2021.|
1. Bitcoin (BTC)
Bitcoin has been around for the longest time of any cryptocurrency. It is easy to see why it is the leader, with a price and market value that is far higher than any other crypto investment options.
Many companies are already accepting Bitcoin as a method of payment, which makes this cryptocurrency a smart investment. Visa, for example, deals with Bitcoin. Additionally, Tesla announced in February that it had invested $1.5 billion in it, and for a while, the company accepted it as a payment for its cars — and perhaps again if mining becomes more green. In addition, major banks have started incorporating bitcoin transactions into their offerings.
Risks of investing in bitcoin
The value of Bitcoin tends to fluctuate a lot. You may see the price go up or down thousands of dollars during any month. If such wild fluctuations are making you nervous, you may want to avoid Bitcoin. Other than that, as long as you keep in mind that cryptocurrency can be a smart long-term investment, these fluctuations should not be too worrying.
Another reason to reconsider investing in Bitcoin is its price. With a single bitcoin costing more than $48,000, most people can’t afford to buy entire bitcoins. For investors who want to avoid buying a fraction of Bitcoin, this is a downside.
2. Ethereum (ETH)
Ethereum differs from Bitcoin in that it is not just a cryptocurrency. It is also a network that allows developers to create their own cryptocurrency using the Ethereum network. While Ethereum lags far behind Bitcoin in terms of value, it is also far ahead of other competitors.
Although it came out a few years later from some other cryptocurrency, it has far outpaced its niche in the market due to its unique technology, and it is currently the second largest cryptocurrency after Bitcoin.
Risks of investing in Ethereum
While Ethereum uses blockchain technology, it has only one “passage” for transacting. This can cause transactions to take longer to process when the network is overloaded. Transaction fees are also high, reaching a peak of $71.72 in May, according to CoinMarketCap.
In 2016, a hack that took advantage of a vulnerability resulted in the loss of more than $50 million in Ether.
3. Binance Coin (BNB)
After years of relatively flat prices, at least by crypto standards, the Binance Coin platform took off at the start of the year, rising from around $38 on January 1 to an all-time high of $683 in May. As of December 21, it is trading at $525.94.
Due to its performance, Binance Coin has proven to be one of the most stable investment options. Binance is the largest crypto exchange in the world, according to CoinMarketCap, but despite its broad functionality and the success of the coin in Binance sub-projects, Binance Coin remains a very volatile investment.
Risks of investing in Binance Coin
What distinguishes Binance Coin from its competitors is that it was created by a company rather than a group of tech developers. Although Binance Coin’s commitment to keeping the blockchain strong has garnered many skeptics, some investors remain apprehensive about this cryptocurrency and its potential security issues.
4. Cardano (ADA)
The Cardano network has a smaller footprint, which is what attracts investors for several reasons. It takes less energy to complete a transaction with Cardano compared to a larger network like Bitcoin. This means that transactions are faster and cheaper. Earlier this year, Cardano launched Hard Fork, an upgrade that increased functionality — in this case, enabling smart contract deployment.
Cardano also claims to be more adaptable and safer. It is constantly improving its evolution to stay ahead of the hackers.
Risks of investing in Cardano
Even with a better network, Cardano may not be able to compete with the bigger cryptocurrencies. Fewer adopters means fewer developers. This does not attract most investors who want to see a high adoption rate. The platform has big plans, but there are doubts about whether it can live up to this potential.
Do not discourage market volatility. Your investment may lose money one day and make a profit the next. Instead of falling into the trap of daily changes, look at the big picture.
5. XRP (XRP)
XRP was created by the founders of the digital payment processing company Ripple. It acts as an encrypted PayPal of sorts, allowing exchange between both cryptocurrencies and fiat currencies.
Ripple is investing heavily in non-fungible token projects that use the XRP Ledger, a public blockchain. This investment indicates that Ripple is positioning itself as another “Ethereum killer,” according to Inside Bitcoins.
Risks of investing in XRP
In December 2020, the Securities and Exchange Commission sued Ripple and two of its executives, alleging that they had violated the registration provisions of the Securities Act of 1933 by raising more than $1 billion by offering unregistered securities for digital assets. Suggesting that XRP is a security, not a currency, could have consequences not only for XRP, but also for other cryptocurrencies.
6. Solana (SOL)
Solana captured the cryptocurrency world starting in 2021 with 0.01% of the market and climbed to the top 10 cryptocurrencies by market cap by September, giving its main competitor, Ethereum, a run for its money. Solana ranks fifth by market capitalization, which currently stands at $54.88 billion, according to CoinMarketCap. Its appeal lies in the speed of its network, its scalability, and the ease with which it can be used to create decentralized applications that run on the blockchain, Decrypt explained.
Risks of investing in Solana
Solana has seen a staggering rise of nearly 11,000% this year, and prices could drop as quickly as they have grown. Reliability may also be an issue, given that Solana experienced an outage of about a day due to “exhaustion of resources,” according to Bloomberg, as reported by CNBC.
7. Avalanche (Afax)
Avalanche is a new “layer 1” blockchain — a blockchain that improves the underlying protocol to make the system more scalable, as described by Binance — founded as a competitor to Ethereum by Ava Labs and computer scientists at Cornell University, one of whom, Professor Emin Gun Sirer is a veteran expert. in crypto research, according to CoinMarketCap. While the Ethereum nodes must validate each transaction, the three individual blockchains in Avalanche can validate transactions independently. This makes the avalanche more scalable and better able to handle large volumes of transactions – up to 6,500 per second. As a result, it is becoming increasingly popular among Ethereum projects, US News reports.
AVAX started trading in 2020, with a 24-hour initial coin offering. The price has fluctuated from $2.79 to $146.22 over the past year. The coin is currently trading at $123.09.
Risks of investing in avalanche
Sirer presented the cryptocurrency via a white paper in 2018. It was launched in 2020. With such a short history, Avalanche doesn’t have a solid track record to compare, making it a riskier investment for potential buyers.
8. Cord (USDT)
Tether is a stablecoin, which means that its value follows the US dollar. Because of that, it does not experience the volatility that other cryptocurrencies experience. The value is always at or near $1. You can’t buy Tether at a low price and sell it at a high price to make a profit, but you can use it to keep the money you take out of other cryptocurrencies without converting it into cash.
With a market capitalization of over $76 billion, Tether is the fourth largest cryptocurrency, according to CoinMarketCap.
Risks of investing in rope
Although Tether is fully backed by assets such as cash and bank deposits, reverse repo notes, US Treasury bills, secured loans, corporate bonds, funds and precious metals, US government regulators say digital assets, including stablecoins, are not stable in the Indeed. Regulators have said stablecoins should be subject to bank-like rules to protect investors, CNN Business reports.
Don’t settle for any number of cryptocurrency investments without continuing to learn about the market. A new network of cryptocurrencies can easily climb the ranks and emerge as a leader above other platforms. As an investor, the smartest thing you can do is keep up with market events.
Rating of the best cryptocurrency options
Do a quick search online and you will find dozens of recommendations on how to invest in cryptocurrencies. In selecting the top eight picks, the following factors were taken into account.
How long has cryptocurrency been around? New cryptocurrencies are not immediately dismissed, but having historical data for comparison helps you see how the company has performed so far.
How has the company performed during its years of operation? If you see price stability, that’s a good sign. If you notice that the cryptocurrency is gaining traction and becoming more valuable over time, all the better.
good to know
Past performance is not an indication of future performance. Things can change at any time, and investment performance may be better or worse than it has in the past.
How does the platform compare to others in terms of ease of use and security? The first thing you want to look for is the speed at which transactions occur. The network should be able to handle transaction traffic with ease.
You also want to make sure that your investment is safe. Most cryptocurrencies use blockchain technology, which makes all transactions transparent and easy to trace. Blockchain technology does not necessarily make it difficult for hackers to steal your cryptocurrency. It makes it easy to keep track of your investment so that it can be recovered rather than lost after fraud.
How many people are investing in the cryptocurrency you are considering? When you see a high level of adoption, it means that the cryptocurrency has better liquidity. Trading, selling or spending will be easier in the future.
Take the final
There is no doubt about it: cryptocurrencies are here to stay. The question becomes, where is the best place to invest your money in the market?
When deciding which cryptocurrency is the best investment for you, here are some other things to keep in mind:
- The speed with which transactions are completed
- Transaction related fees
- Ability to use cryptocurrency for regular purchases and bank transfers
If you are strictly looking to invest without making intranet transactions, remember that cryptocurrency is not a get-rich-quick scheme. Instead, you should consider it a long-term investment.
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Daria Oleg contributed to this article.
Data is accurate as of December 22, 2021, unless otherwise noted, and subject to change.
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