By: Team Giottus
Cryptocurrencies have grown in popularity in the previous few years.
But with thousands of cryptocurrencies in the market, distinguishing between a solid investment option with long-term growth potential and short cash grabs that will not survive a bad market can be difficult.
While the value of various cryptocurrencies has risen and fallen, what makes them critical is that they are extremely volatile and are not backed by any government. Crypto can be a beneficial investment if one carefully invests considering one’s age, risk tolerance, overall financial strategy, and whether they can afford to lose the money they invest.
As cryptocurrencies are relatively new investments, it is critical to create a diversified and balanced portfolio and conduct in-depth research before investing. Bitcoin and Ethereum are the first coins that come to mind when thinking about investing in crypto. However, we have combined a list of five cryptocurrencies other than Bitcoin and Ethereum that one can invest in by looking at the market capitalization, the total worth of all coins currently in circulation, and future price potential to help you get your bearings.
Binance Coin (BNB)
Binance Coin is a cryptocurrency that can be traded on one of the major cryptocurrency exchanges, Binance. BNB has grown beyond simply conducting deals on Binance’s exchange platform since its introduction in 2017. It can now be used for trade, payment processing, and even making travel reservations.
The quarterly token burn mechanism is one characteristic that distinguishes BNB from other cryptocurrencies. Every quarter, 20% of its profits are spent on purchasing back tokens and subsequently burns the tokens by sending them to untraceable addresses. It is a method that allows BNB to generate a supply and demand gap, raising its value in the process. While every cryptocurrency has inherent risk, BNB surpasses the competition in two major areas: the Binance exchange and the presence of the Binance Smart Chain. These two factors considerably lower the risk, and unless other cryptocurrencies, such as Ethereum, develop a faster platform, BNB appears to have a bright future.
Cardano (ADA) is renowned for being one of the first cryptocurrencies to incorporate proof-of-stake validation. By removing the problem-solving part of transaction verification found in platforms like Bitcoin, this solution reduces transaction time, energy consumption, and environmental effect.
Cardano, like Ethereum, uses ADA, its native coin, to enable smart contracts and decentralized apps. It is in fact, also the only coin with a “scientific philosophy and research-driven methodology”. In practice, this means that its open-source blockchain is subjected to a thorough peer-review process by academic scientists and programmers.
Cardano’s non-profit foundation has also teamed up with several academic institutes to conduct a study and analyze all areas of its blockchain. Cardano’s ADA token has also had a relatively modest growth compared to other major crypto coins.
Polkadot is a growing collection of interconnected blockchains. It is an open source shared multi-chain protocol that connects and secures a network of other networks, allowing data or assets to be transferred. This network is an important part of the Web 3.0 architecture for online content and communications in the next generation. DOT has only been established for a year and a half, and it still has a long way to go in the coming years.
Polkadot is essentially a bundle of interconnected blockchain networks that can reach out and join additional partner blockchains over time as a layer-zero protocol. In this market, a long-term survivor should be able to prune bad ideas and replace them with superior ones. Polkadot runs in this manner, making it an indisputable cornerstone of the Web 3.0 platform architecture.
Created by some of the same founders as Ripple, a digital technology and payment processing company, XRP can be used on that network to ease the exchange of many currency kinds, including fiat currencies and other major cryptocurrencies.
Some major financial companies, including American Express, Kotak Mahindra, and IndusInd bank are already using the Ripple network. This indicates that technology is in high demand in the actual world.
Because XRP is utilized for a specialized purpose in the financial industry, its price is not influenced by the same factors that affect the price of other coins like Bitcoin and Ethereum. If you are trying to diversify your cryptocurrency holdings, Ripple XRP could be a good way to do so without putting your portfolio at risk of industry trends.
Ripple’s transaction speed is faster than VISA’s, thus as more consumers turn to challenger services, Ripple should be on everyone’s mind. The coin is slowly but surely catching up to its traditional opponents.
Polygon is an Indian blockchain scaling platform dubbed “Ethereum’s Internet of Blockchains.” It is considered the solution to some of Ethereum’s current problems, such as high fees, poor user experience, and low transactions per second.
Polygon is an Ethereum sidechain that is rapidly scaling DeFi. Initially known as the Matic Network, Polygon was created to scale Ethereum and improve the infrastructure. It uses a proof of stake consensus mechanism to secure the network, verify transactions and create new currencies.
Many climate change activist groups have slammed the crypto business for its high energy consumption. Polygon addresses these issues by offering a decentralized platform for low-cost transactions. The network describes itself as a scaling solution at layer two. On each side chain, its unique transaction fulfillment technology enables up to 65,000 transactions per second. Proof-of-stake checkpoints are used in the system, which could allow millions of transactions on the blockchain in the future. Polygon’s side chains were also created to assist decentralized finance protocols in the Ethereum environment.
Polygon is not only assisting in the fight against climate change by joining the green movement, but it also can attract the attention of environmentally conscious investors, bolstering the case for a bullish price prediction.
Regardless of which cryptocurrency you choose to invest in, keep in mind that cryptocurrencies are very volatile assets. It is only prudent to invest in what one can afford to lose.