The best cryptocurrency to invest in 2021 or 2022 is any digital currency that you can buy into with the expectation of achieving a profit.
Cryptocurrency has emerged as the new frontier, not only as an alternate financial order, but also as the latest in computing and information technology. Blockchain, the underlying technology behind crypto is ushering a new era in human-machine interaction focused on identity management, smart contracts and supply chain, to name a few.
The tale of crypto has origins in the genius of a pseudonymous software engineer, Satoshi Nakamoto. The resulting contrivance, Bitcoin, is far from being the only cryptocurrency in the market now. In its simplest terms, cryptocurrencies rely on the security of interlinked blocks wedded in a series of transactions, akin to a chain; hence the cognomen, Blockchain. If there was ever a need to record events in such an arrangement, it has to be financial transactions. The way blockchain lends itself so seamlessly to the synthesis and accretion of cryptocurrency is indeed apt.
Now that the crypto market is splattered with a bevy of over 5000 brands and breeds of virtual currencies with varying features and characteristics, it is incumbent to look into their value as an investment. Before delving into the specifics of five major cryptocurrencies it should be noted that, in general, the crypto market has seen a phenomenal surge in token-to-dollar value during the past 18 months, or roughly, as long as the COVID-19 has prevailed upon the precarious commercial and financial system of the world. In contrast to its past volatility, cryptocurrencies have steadily increased in value and even when their values dived, it recovered quite quickly. Hence, fulfilling the basic requisite of a ‘good investment’. To top this, the security and safety of blockchain that endows cryptocurrencies have made it a smart investment. Finally, the double-edged sword of regulation, or lack thereof, renders cryptocurrency a valuable asset for parking one’s capital.
Moving on from general to specific, we’ll take a peek into five of the best performing cryptocurrencies; Bitcoin, Bitcoin Cash, Litecoin, Ethereum and Hedera HBAR. The elemental instrument of evaluation is the token-to-dollar value of each currency and its prospects. Other aspects under consideration will be the currency’s longevity, track record, technology, adoption rate and apparent risks.
1. Bitcoin (BTC)
Bitcoin is valued around $58,900 right now which makes it by far the most valuable cryptocurrency to buy into. In fact, Bitcoin has no competition, by a long stretch, with any of the other currencies in this list. This exponential value can be credited to Bitcoin’s pioneering track record and longevity. For its adoption rate, Bitcoin returns some very impressive stats. With 45% crypto market dominance, Bitcoin has no plans to slow down as it features on the long-term strategic plans of global corporate behemoths like Facebook, Tesla, Google, Samsung, Apple and PayPal. So, with prospects secured and value riding on a frenzied bullish run, Bitcoin is surely the numero uno choice for investors. The technology that Bitcoin peruses is the one that birthed the whole blockchain revolution. Each transaction is archived on a ‘distributed ledger’, available for all to see and scrutinize. The average transaction time for Bitcoin is ten minutes but this can fluctuate depending on factors such as transaction verification or mining which requires velocious computing rigs to solve cryptographic puzzles at high speed.
Fluctuation, albeit of a different kind, is also the inherent risk of investment in Bitcoin. The ticklish boost and bust in Bitcoin’s value can unnerve a prudish investor. But, as cryptocurrency is a long-term smart investment, the veering value of Bitcoin shouldn’t concern any intrepid investor. More importantly, investing in Bitcoin is no longer for light-pocketed investors. With value bordering $60,000 to a coin, it is out of reach for most people. Such investors, then, resort to partial buying which has demerits of its own.
2. Hedera Hashgraph (HBAR)
If there was ever a need to redefine the limits of ‘envy’, it should be modeled after Hedera Hashgraph. Based on ground-breaking asynchronous Byzantine Fault Tolerance (aBFT) consensus algorithm, Hashgraph has turned the world of cryptocurrency upside down through its elimination of mining in favor of directed acyclic graphs for validating transactions. Hedera’s white-paper, co-authored by Swirld’s Leemon Baird, expostulates the intrinsic inertia of first and second gen cryptocurrencies and offers enhanced speed, transparency at low cost and impervious security protocol. With backing from pioneers like IBM and Google, Hedera is all set to become a genuine leader in crypto and digital currency realm.
Currently valued at $0.20, Hedera has more than meets the eye. With its superior technology that empowers lightning-fast transactions at superior security as compared to conventional blockchain, Hedera is undoubtedly a terrific long-term investment. Hedera may become the first crypto to break the regulatory impasse as it is rumored that it will co-develop a digital dollar with the Central Bank. Hedera’s USP is its environment-friendly transaction mechanism. Bitcoin and other crypto spin-offs, as per scholarly estimates, could raise Earth’s temperature by 2˚C due to their parlous mining methods while Hedera’s low-bandwidth consumption make it more friendly to the environment. Apart from these stellar characteristics, Hedera seems to enjoy the trust of major financial players both in the private and public sector.
When seen as an investment, Hedera’s sound vision and well-thought out plan is a guarantee of its success and ability to return respectable profits.
3. Ethereum (ETH)
If the question is what other cryptocurrency can give Bitcoin a run for its money, the answer would be Ethereum. Launched in 2014, Ethereum has become the most influential cryptocurrency within a jiffy. Ethereum’s insane popularity owes itself to the platform’s allowance for all to build upon its blockchain and a wider selection of applications that its blockchain can support. Apart from payments via Ether, its token, Ethereum also sanctions smart contracts and advanced identity management.
Ethereum fueled the DeFi (decentralized finance) revolution which birthed the now burgeoning peer-to-peer finance via decentralized technologies. The innovative spirit of Ethereum, hence, is its strongest suit for investors. Only behind Bitcoin in market share, Ethereum is currently valued at $2125 to an Ether, which is on a bullish rally this year and expected to swell significantly. The rapid adoption of DeFi in coming years is bound to augment the acceptability of Ethereum. All of these factors make Ethereum an exciting investment, one which would be envy of any respectable cryptocurrency.
4. Bitcoin Cash (BCH)
Invariably defined as an ‘upgrade’, Bitcoin Cash offers a much simpler, speedier and sizable alternate to Bitcoin’s strangulated transaction mechanism. The intention behind Bitcoin Cash’s development was to afford larger transaction blocks than Bitcoin, reducing the transaction time. Since Bitcoin Cash has a larger ledger size, with each block accommodating up to 32 MBs of transaction data, it is faster than Bitcoin and hence, can be effectively scaled as compared to Bitcoin. Even without performing at its optimal 32MB block size, Bitcoin Cash enables shorter transaction times and lower transaction fees.
Now as they say haste is of the devil, Bitcoin Cash’s speed results in lopsided security. The whole gamut of adoption hinges on a cryptocurrency’s security protocol and when that is compromised, chances are that the currency will be ignored into oblivion. Right now, Bitcoin Cash faces no such fate and is geared to valuate at around $1,000 in near future. The value and its cutting-edge technology make Bitcoin Cash a prudent investment to plow money into. Additionally, its adoption by the Japanese e-commerce giant Rakuten bodes well for its future. However, its relative greenness in the crypto world is a matter of concern for investors who particularly prefer established currencies such as Bitcoin and Litecoin.
5. Litecoin (LTC)
Although Litecoin took off around the same time as Bitcoin in 2011, it had a rather sedate rite of passage into widespread acclaim and adoption. The feather in Litecoin’s cap is its ultra-swift transaction time which is four times as that of Bitcoin. So much so that Litecoin accomplished an industry-first when it completed a transaction in under one second in 2017 through its use of Lightning Network. Furthermore, Litecoin is not limited in number as opposed to Bitcoin’s 21 million. These two factors give investors the much-sought psychological solace. Apart from that, these factors contribute negligibly in Litecoin’s value or usability.
For an investor, the closest any cryptocurrency has come to Bitcoin’s technological acumen is Litecoin. From transaction mechanism to mining to cold storage and value volatility, Litecoin and Bitcoin are close cousins. But when compared on factors such as market capitalization, distribution, algorithm and value; these two currencies cannot be more far apart. Valued at a measly $245 to a coin, Litecoin is far from dethroning Bitcoin as the ‘King of Cryptocurrency’, but it certainly has the spine to sustain itself for a long, long time.
Price Prediction 2022Future forecast price predictions are based on past and present data or trends, speculation and estimated future events by the end of 2022.
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We have laid a crisp picture of investing in cryptocurrency and advise you to take it all with a grain of salt. The metaphorical salt in this case is the market research and the bone to bear risk while investing in cryptocurrency. Read, observe, compare and exercise caution – that is the rulebook of investing in cryptocurrency. The specifics entail speed and transparency of transaction, the adoption rate and ratio and the verification technology of each currency. Above all, do not construe investment in crypto as a get-rich-quick scheme. It is a long-term investment and must be given due respect as such.
Hill.house.gov. “Rumor: Hedera (HBAR) Working On The Digital Dollar With The Central Bank? By hill.house.gov.”, 25 Mar. 2021, https://hill.house.gov/news/documentsingle.aspx?DocumentID=8350.
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