Cryptocurrency Market So Far
The first cryptocurrency, Bitcoin, was invented back in 2009. That was just the beginning though, and nobody really knew about Bitcoin until 2013. Additionally, no one even thought that it might become the best cryptocurrency to invest in.
However, since 2013, the cryptocurrency market has seen huge growth — growth that has been hard to ignore. There are now more than 1500 different cryptocurrencies, all created in less than 5 years.
It’s clear that 2017 was the year crypto really blew up. The market cap of cryptocurrencies grew by 4000%! The market cap of all cryptocurrencies was around $21 billion in March 2017, whereas it is now over $454 billion. That’s huge!
The market isn’t just about Bitcoin anymore. There are other cryptocurrencies that have entered the space, such as Ethereum, Litecoin, and Ripple. All of these have performed incredibly well over the last year and can all be called "the best cryptocurrency to invest in".
The following chart from CoinMarketCap shows the growth of cryptocurrencies over the years.
There are a lot of things being said about the future of cryptocurrencies. Some people believe that the cryptocurrency phase won’t last long, while others think they’re going to be around forever.
It is difficult to predict the future of cryptocurrencies, but what I do know is that the popularity of cryptocurrencies is only increasing. One of the reasons why cryptocurrencies are becoming more popular is because of blockchain technology, which is the main technology behind all cryptocurrencies.
Blockchain technology is the next big thing – it is a secure piece of technology that was first used by Bitcoin. You can’t learn how to invest in blockchain, though. Instead, you can learn how to invest in the cryptocurrencies that use blockchain (which is all of them!)
Are you ready to find out about the next cryptocurrency to invest in 2021? Well, let’s get started.
What are the Best Cryptocurrencies to Invest in 2021?
Below, you'll find a few options for the best cryptocurrencies to invest in 2021 and beyond (well, at least for the foreseeable future).
Bitcoin (BTC)
If, somehow, you’ve only heard of one cryptocurrency, it’s probably Bitcoin. It is the biggest cryptocurrency — it currently has a 40% share in the total cryptocurrency market cap! It is the oldest cryptocurrency and it still dominates in the market. So, if Bitcoin continues to increase as it did in 2017, then investing in Bitcoin might be a good idea for 2021.
The price of Bitcoin changes a lot every day, and has seen many highs and lows over the last few years.
The price of 1 Bitcoin has gone from around $76 (07.09.13) to as high as $20,000 in December 2017. But then, after Bitcoin reached its highest point in December, the price of Bitcoin dropped to around $6000 in February 2018 and has been fluctuating ever since. It’s crazy!
With the price changing so much in such a short space of time, how do you decide what the best time is for investing in Bitcoin?
Well, we can try to find the answers by looking at some important past events — when the price went up or down by a large amount.
One major event was when Bitcoin split into two cryptocurrencies — Bitcoin and Bitcoin Cash. This happened on August 1st. Investors who knew about this invested their money before the split and made huge profits, almost doubling their investment!
The price of Bitcoin dropped to around $10,000 in January 2018, almost half of the $20,000 it was worth in December 2017. Many investors became worried at this point and started selling their Bitcoin. This caused the price to fall to around $6,000 in February 2018.
Bitcoin Investing
If you want to invest in Bitcoin then you need to stay up to date with the latest news and trends around Bitcoin. When news is released about a new technical improvement, you might want to think about buying Bitcoin. If there is a huge fall in price of the cryptocurrency in question, then that too might be a good time to buy Bitcoin because you can buy it at a low price.
If you have already decided to invest in cryptocurrencies, then it might be a good idea to start by investing in Bitcoin. Even though you have missed the first major opportunity to invest, investing in Bitcoin could still be a good idea.
It all depends on whether or not you believe in the future of Bitcoin. If you're a believer, you should think about investing in it. If you're not, then I recommend that you stay away from it. It’s the same as with any other investment!
Ethereum (ETH)
Towards the end of last year, the price of Ethereum was slightly higher than $720, with a total market cap of around $70 billion. At the beginning of 2018, Ethereum climbed and reached its highest price of $1423 on January 4. At this time, the total market cap for Ethereum was $138 billion!
Ethereum grew by about 3000% in the year 2017 and became the second-largest cryptocurrency, placing second behind Bitcoin.
Are you asking yourself, “should I invest in Ethereum?”, “is the price of Ethereum already at its peak?”, or "is Ethereum the best cryptocurrency of 2021?". Well, the truth is, nobody knows! However, the following information should help you decide whether investing in Ethereum is a good option for you.
Below are the key events that have most affected the price of Ethereum in the past:
Ethereum received an investment of around $150 million in May 2016. As a result, its price went up from $1 in January 2016 to around $14.80 in May 2016.
However, On June 18th, 2016, members of the Ethereum community found out that Ethereum had been hacked. Around $60 million worth of Ether (Ethereum’s currency) was stolen due to a flaw in a wallet. This caused the Ethereum price to drop from the high of $21.52 on 17th June 2016, to $9.96 on the 18th June 2016.
Unlike Bitcoin, Ethereum is not just a digital currency. It is a more advanced blockchain project. This is because Ethereum offers something special — by using Ethereum’s platform, developers can build their own cryptocurrencies.
Imagine that you would like to build a blockchain-based solution for managing the supply chain of your business. Well, thanks to Ethereum, you don’t need to start from the beginning. Instead, you can just build an application on Ethereum’s blockchain. Ethereum makes it much easier for new blockchain projects to launch.
So, is Ethereum your next cryptocurrency to invest in 2021?
I recommend that you think about adding Ethereum to your list, as I think it could be one of the best cryptocurrency to invest 2021.
Julian Hosp, a blockchain expert, said that the market cap of Ethereum could rise to $200 billion by the end of 2021. If Hosp’s prediction is correct, the price of Ethereum will reach up to $2000. Hosp’s reason behind the prediction is based mostly on the ICOs (Initial Coin Offerings) that decided to use the Ethereum blockchain in 2018 & 2021.
Ethereum also plans to improve their technology a lot this year, with new protocols almost ready to go. So, watch out for Ethereum!
To learn more about Ethereum, read our Ethereum vs Bitcoinguide.
Ripple (XRP)
Ripple, also known as XRP, was a prime contender for the spot of the best cryptocurrency in 2017 with growth of around 36,000%! Yes, you read that right. It grew from almost $0 at the beginning of 2017 and reached $2.4 in December 2017 — as you can see in the following chart.
Like all other cryptocurrencies, the price of Ripple has also decreased in 2018 — it is currently set at $0.20.
I know what you’re thinking — you missed a great opportunity by not investing Ripple in early 2017. While that’s true, Ripple could still be a good option to consider as your next cryptocurrency to invest in 2021.
Even though the price of one XRP is a lot lower than the price of one Bitcoin, XRP is still the third-largest cryptocurrency by market cap. In May 2018, it had a total market cap of around $35 billion.
So, what is it about Ripple that has made it so popular for investors?
The main reason for Ripple’s popularity is that it is not just a digital currency, but also a payment system. Ripple uses blockchain technology to make international payments faster and more secure.
If you tried to make an international bank payment today, it would take around 2-10 days for the transaction to process. The same payment, when done using Ripple, takes a few seconds. How awesome is that!
But there’s more good news – many large financial institutions like American Express, JP Morgan and Santander are already using Ripple’s technology. Also, Ripple has been working with the Saudi Arabia Central Bank, China’s LianLian International and other banks from around the world.
So, if you’re wondering how to invest in blockchain, then Ripple might be the best answer.
Based on what I just explained, Ripple’s future in the financial industry could be a good one. You should watch out for Ripple and learn more about their partnerships. Look out for new partnerships too — if Ripple signs a contract with another large bank, then it could increase the price of XRP.
The investors who understood the services that are offered by Ripple have made a lot of money. After a fantastic 2017, Ripple could just be the best cryptocurrency of 2021.
Note: Now might be a good time to invest in Ripple, as its price has dropped 70% lower than it’s an all-time high of $3.4 in January 2017.