Seven of the best cryptos to invest in for December.
The cryptocurrency asset class fluctuated wildly over the last month, with multiple major tokens like Bitcoin (BTC) and Ethereum (ETH) hitting all-time highs before subsequently entering bear markets. Several catalysts helped spark the downturn, not least of which were the emergence of the omicron variant and the Federal Reserve’s open willingness to raise interest rates earlier than previously thought to help combat inflation. Digital assets remain both one of the riskiest areas to deploy capital and one of the most promising growth opportunities entering 2022. Here’s a look at seven of the best cryptocurrencies to buy in the final month of 2021, and the reasons each coin might prove to be a wise investment.
Bitcoin is an obligatory holding for any investor looking to dip their toes in the cryptocurrency market. Even after the recent pullback, BTC accounts for roughly 40% of the overall market capitalization, a metric known as a given coin’s “dominance.” November was an eventful month for the digital asset, which hit an all-time high just shy of $69,000 and subsequently entered bear market territory late in the month following the emergence of the omicron variant. El Salvador, the first country in the world to make Bitcoin a national currency, bought the most recent dip in BTC, with its president announcing Dec. 4 that the country had acquired 150 coins at an average price of $48,670. As in the stock market, playing short-term trends in crypto is more akin to gambling than investing. For long-term investors, though, Bitcoin is very much still on the rise, and if past is prologue, severe pullbacks should be considered buying opportunities.
Ethereum remains among the best cryptocurrencies to buy today. With Ethereum’s dominance clocking in at more than 21%, not only do BTC and ETH account for more than 60% of the market, but between the two, Ethereum actually became more dominant during the volatile 30 days from Nov. 5 to Dec. 5. Unlike Bitcoin, whose market share fell from 42.7% to 40.8% in that time, ETH went from 19.6% to 21.6% of the crypto market. Fundamentally different from BTC, Ethereum is the most-used blockchain in the world and the network of choice for the young, booming field of decentralized finance (DeFi), as well as a popular host for nonfungible tokens, or NFTs.
2021 has been an eventful year for cryptocurrency as a whole, but one of the more remarkable storylines of the year was the sudden emergence of Solana, which went from accounting for just 0.01% of the market to more than 2.6% by early December. The DeFi field — characterized by smart contracts, a trustless ecosystem and the unapologetic cutting-out of third-party financial gatekeepers like banks and centralized exchanges — is practically guaranteed to rise in prominence in the years ahead. Anyone placing a wager on DeFi’s continued growth would be well served to invest in Solana, a developer-friendly network with far lower transaction fees than Ethereum. Solana’s low fees, maturing ecosystem and promising future in DeFi make it one of the best cryptocurrencies to buy.
Binance Coin (BNB)
Currently the third-largest token by market cap, BNB nonetheless accounts for just 4.1% of the cryptocurrency market, leaving plenty of room for it to gobble up market share over time. That’s precisely what Binance Coin has done in 2021, as its market dominance rose from 0.7% to start the year to 4.1% by early December. As with many of the top cryptocurrencies to invest in, BNB is the native coin for an increasingly popular blockchain, the Binance Smart Chain. Binance itself is the world’s single largest cryptocurrency exchange, exceeding even Coinbase Global Inc. (ticker: COIN). BNB debuted in 2017 and is designed to have a maximum supply of 200 million coins. The end goal is to reduce the supply to 100 million BNB, which the exchange does by quarterly “burns” that reduce the supply.
Funded in part by both Binance and Coinbase, the Polygon platform was built on Ethereum with the intention of morphing Ethereum into a multi-chain system. The intention is to create a more versatile and scalable cryptocurrency ecosystem that will enable more rapid mainstream adoption of crypto. Now among the top 15 cryptocurrencies by market cap, MATIC has surged in value from less than 2 cents to start the year to about $2 in early December. In the most recent test of Polygon’s stability, MATIC was one of the few major tokens to actually advance in the early December sell-off, jumping 21% between Nov. 28 and Dec. 5. Resilience in challenging times is a cherry on top that solidifies MATIC as one of the best cryptocurrencies to invest in for December and beyond.
Avalanche Token (AVAX)
Founded by a trio of Cornell University-affiliated computer science researchers, Avalanche debuted via an initial coin offering in 2020 and is backed by elite venture capital firm Andreessen Horowitz. The AVAX coin began the year trading for just $3.17 and currently trades for more than $80 as its network has rapidly earned market share. Not one for modest ambitions, Avalanche openly aims to surpass Ethereum as the most popular smart-contract blockchain. What Avalanche lacks in short-term resilience — AVAX badly underperformed during the most recent market pullback — it makes up for with its surging popularity. Increasingly compatible with prominent Ethereum projects like SushiSwap, Avalanche is also growing its relevance through “bridges,” which allow users to move cryptocurrencies from one blockchain to another.
Kitty Inu (KITTY)
In keeping with this list’s tradition, the month’s final pick is a purely speculative name and easily the riskiest cryptocurrency mentioned. While the other tokens vying for the title of best cryptocurrency to invest in all have real utility, their own blockchains and established use cases, Kitty Inu is an aspiring meme token. The smallest market cap among the previous six picks was about $14 billion, and KITTY’s fully diluted market cap is right around $100 million. While far more likely to lose a huge percentage of its value than other picks, Kitty Inu is also arguably the most likely to “moon,” with the coin currently costing about one-hundredth of a cent. With dog-themed coins like Dogecoin having enjoyed their day in the sun, one might expect feline-themed cryptos to eventually ride the meme wave, and KITTY, in that case, could be a massive beneficiary. Only investors willing to lose their entire investment should back Kitty Inu.
Seven contenders for the best crypto to buy in December:
— Bitcoin (BTC)
— Ethereum (ETH)
— Solana (SOL)
— Binance Coin (BNB)
— Polygon (MATIC)
— Avalanche Token (AVAX)
— Kitty Inu (KITTY)
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What’s the Best Cryptocurrency to Invest in Now? 7 Contenders originally appeared on usnews.com
Update 12/06/21: This story was published at an earlier date and has been updated with new information.