For most of those who deal less intensively with digital currency, only Bitcoin is probably a term. For many it is, so to speak, representative of Kypto currencies. In addition to Bitcoin, Ethereum, Ripple and Co., there are hundreds of other digital currencies.
The website coinmarketcap.com listed around 7,300 actively traded cryptocurrencies in 2020. Of these, however, only a few “significant players” are on the market. Below is an overview of the 10 most popular cryptocurrencies around the world.
Bitcoin € 739,387,569,373
Ethereum € 322,899,628,761
Binance Coin € 55,687,623,560
Tether € 53,426,695,704
Cardano € 48,905,207,419
XRP € 35,283,273,257
Dogecoin € 30,100,435,023
USD Coin € 23,899,367,631
Polkadot € 18,345,636,529
Uniswap € 15,058,622,274
Market capitalization as of : 11 .09.2021 , Source: CoinMarketCap
The market capitalization results from the multiplication of the current price and the total number of coins in circulation. Therefore it is subject to constant changes.
Bitcoin – is there still anything going on with the “mainstream coin”?
Bitcoin was the first cryptocurrency based on blockchain technology and, despite technological deficiencies, is still by far the most valuable and widely used cryptocurrency. It is being accepted as a means of payment by more and more providers and has been attracting great interest from numerous companies for some time. Due to its high media presence, it is already known to large parts of the population.
Ethereum – Bitcoin’s fiercest competitor
In contrast to Bitcoin, Ethereum is not just a currency, but also a network for so-called “smart contracts”. These “smart contracts”, for example, can only distribute money if a whole group of people agrees. More than 200 organizations, including companies like JPMorgan Chase, Mastercard or Cisco Systems, are currently experimenting with Ethereum. Ethereum Blockchain forms the technological foundation of many other cryptocurrencies and was introduced in 2015.
Tether – risky price fluctuations
The unregulated token cryptocurrency Tether is traded as a so-called stablecoin 1: 1 to the US dollar. The fact that Tether is issued solely by the company Tether Limited is viewed critically. Many complain about the lack of transparency. In addition, there are allegations that Tether Limited has masked lost funds amounting to $ 850 million.
Ripple – “the Bitcoin of the banks”
The great advantages of Ripple are the short processing times and the low transaction fees, which is why Ripple has also received special attention in the banking sector. It enables cost-effective and efficient cross-border payment transactions. This also makes it attractive to companies such as American Express, Santander and MoneyGram International.
Litecoin – faster block times
The Litecoin is very similar to Bitcoin, but has a modified mining mechanism and can therefore process blocks at four times the speed. It was created back in 2011 and is based on an open source encryption protocol. A peer-to-peer network manages transactions, balance sheets and expenses.
Bitcoin Cash – the modification of Bitcoin
Bitcoin Cash emerged from the split from the Bitcoin network on August 1, 2017 and has now risen to become the fourth largest cryptocurrency. The advantages of Bitcoin Cash are, similar to Ripple, in the faster information processing and the resulting faster transaction times.
Cardano – the scientifically proven cryptocurrency
Cardano is cryptocurrency and blockchain platform at the same time and aims to scientifically research and solve all the difficulties currently known in blockchain currencies. It is the first cryptocurrency based on peer-reviewed research and developed using evidence-based methods. Cardano’s goal since 2015 has been to completely redesign the way cryptocurrencies are generated and ultimately to create a decentralized platform in terms of scalability and security for complex and programmable value transfer.
Ethereum competitor Polkadot makes it into the top 10
The still relatively young crypto currency Polkadot can place itself in the top 10 in 2020. Polkadot is a sharded multichain network, which means that many transactions can be processed in parallel in several chains (“parachutes”). This parallel processing power improves scalability. Custom blockchains are quick and easy to develop using the Substrate framework and can be connected to the Polkadot network in minutes. The network is also very flexible and adaptable and enables the exchange of information and functions between participants, similar to apps on a smartphone. Polkadot can be updated automatically to implement new functions or to eliminate bugs.The network has a sophisticated system of user-driven governance that also helps ensure security. Communities can adapt the governance of their blockchain on Polkadot to their needs and changing conditions.
What can the new cryptocurrency do? Krypto Report gets to the bottom of this question.
The Binance Coin (BNB) is the credit currency of the Binance trading platform. Only crypto currencies are traded on this. It achieved enormous success after a very short time and mainly focuses on the Chinese market. Binance stands for a combination of words “binary” and “finance”. More precise technical data about the Binance Coin are still not known.
Chainlink – a revolution for smart contracts?
Since Chainlink appeared in the world of cryptocurrencies, the new platform has caused a stir in the crypto market and aroused the interest of DeFi companies, crypto investors, blockchain and large technology and financial institutions such as Google and SWIFT. Chainlink’s technology aims to solve one of the greatest challenges in the actual implementation of smart contracts: connecting the “real world” to the blockchain e.g. using the market price or the delivery confirmation from theblockchain to confirm transactions in the real world.
BSV – Bitcoin’s Lesser Known Cousin
The BSV, introduced in 2018, is a so-called hard fork currency as a modification of Bitcoin Cash and is also based on blockchain. There were various reasons for the split, mainly technological. Bitcoin SV and Bitcoin Cash differ mainly in terms of block size. With Bitcoin SV it has been quadrupled and is a maximum of 128 MB. Bitcoin SV stands for Satoshi Vision. The BSV continues to use the SHA-256 algorithm for mining.
EOS – survived the little crash unscathed
EOS is one of the few cryptocurrencies that survived the small crypto crash in January 2018 largely without damage. According to Block.One, EOS manages up to 50,000 transactions per second, clearly outperforming Ethereum. EOS has not been around for long and was among the top ten in 2019.
Which cryptocurrency should I invest in in 2021?
As with any investment, an investment in cryptocurrency is associated with both opportunities and risks. The prices of cryptocurrencies are usually much more volatile (erratic) than with stocks, ETFs or funds. This offers the opportunity to participate in rapid growth but on the other hand, of course, severe losses can also arise. These price jumps are often less pronounced with proven cryptocurrencies such as Bitcoin or Ethereum than with newer digital currencies. Therefore, these tend to be more suitable for long-term investments. They have a high market capitalization and are sometimes also accepted as a means of payment. The new cryptocurrencies are often used for gambling, and the risk here is comparatively high.
Based on the transaction volume, you can see which crypto currencies are currently being traded particularly heavily. Trends can be derived from this. One cryptocurrency that many analysts are predicting favorable forecasts is Dogecoin. Although this is far from being as established as Bitcoin or Ethereum, it was able to gain a lot in value in 2021.
There have also been some other coins that have performed well so far in the year and worth a look at: these include Cardano’s ADA, Polkadot’s DOT, Axie Infinity’s AXS, Solana SOL, Polygon MATIC and a handful of others.
As with stocks, it is advisable not just to bet on one card, but to build up a crypto portfolio that is as widely diversified as possible. In this way, falls in the price of individual cryptocurrencies can be cushioned.
Disclaimer: This is not financial dvise. Cryptocurrency investing is risky and you should always do your own research and consult experts if possible before buying any cryptocurrency.