These seven cryptocurrencies stand out in a crowded field.
For virtually all of 2022, cryptocurrencies as an asset class have been a sort of high-beta version of the stock market: When stocks go up, crypto goes up more and vice versa. Unfortunately, stocks haven’t gone up: By the end of September, the S&P 500, the Dow Jones Industrial Average and the Nasdaq had all entered bear markets. At the start of the fourth quarter, the S&P 500 was down 24.8% in 2022, while the tech-heavy Nasdaq was off 32.4%. Crypto had dropped an astounding 56.6% over that period. The good news is that in September, when the stock market shed 9.3%, digital assets showed signs of resilience, losing just 3.1%. The history of crypto price fluctuations is rife with incredible volatility, and more interest rate hikes are almost guaranteed. But for risk-tolerant contrarians, October could be a good moment to take a position in crypto. Here are seven of the best cryptocurrencies to buy.
Bitcoin (BTC)
When it comes to dipping your toe in the proverbial pool that is crypto, all roads lead to Bitcoin. As both the first cryptocurrency and the one with the largest market capitalization, BTC has the most robust track record and best brand name in its asset class. Unlike the other cryptocurrencies on this list, Bitcoin is not integral to some greater ecosystem or decentralized finance network. Arguably best thought of as digital gold or an alternative global currency, there are only 21 million BTC that can ever exist, 19.2 million of which are already in circulation. Like any currency, its value is derived from belief, although unlike the strengthening U.S. dollar, for instance, its supply can never be manipulated. Growing Bitcoin adoption, especially as a tool to diversify corporate treasuries, is perhaps its greatest future catalyst.
Ether (ETH)
The only other coin in Bitcoin’s stratosphere is Ether, the native token of the wildly popular Ethereum blockchain. A favorite of users and developers alike, Ethereum’s ecosystem quickly emerged as an early haven for decentralized finance, or DeFi, applications. Unlike the Bitcoin network, Ethereum offers real-world utility outside of payments, with the issuance of smart contracts and non-fungible tokens launching multibillion-dollar industries practically overnight. In popular culture, one of the biggest knocks against crypto at large is its energy inefficiency. Ethereum confronted that head-on in September when it completed a long-awaited event called “The Merge” that transitioned it from a proof-of-work to a proof-of-stake consensus, reducing expected energy consumption by more than 99%. With a market cap of more than $160 billion, the next-largest non-stablecoin in existence is less than a third of ETH’s size.
Solana (SOL)
Another mainstay in the DeFi space, Solana is an Ethereum-like blockchain with its own robust ecosystem of users and developers. Even easier to code for than Ethereum, Solana’s main advantage over its larger rival is its radically lower fee structure. While Ethereum has a plan in place to reduce transaction fees — also known as Ethereum gas fees — Solana enjoys fees that are already dirt cheap in comparison to Ethereum’s hefty transaction tax. So until Ethereum reduces fees dramatically, something that isn’t expected until at least 2023, Solana will have a favorable handicap to catch up. Solana currently goes for around $34 per coin, modestly above its 52-week low of $26.06 and light years below its 52-week high of $260.06.
Avalanche (AVAX)
AVAX is the native currency of the Avalanche blockchain, which claims to be the fastest smart-contracts platform in the world. Avalanche’s goal for its platform is to become something like the AWS of crypto. AWS, short for Amazon Web Services, is a division of Amazon.com Inc. (ticker: AMZN) and is the largest cloud computing company in the world. Many financial institutions and massive global organizations use AWS to power their online operations. Avalanche aims to do the same for blockchains, seeing a future where every commercial entity will want to launch their own blockchain. Avalanche is uniquely suited to foster such a future via a relatively new feature called subnets. Although a $5 billion market cap is utterly unremarkable in the stock market, it makes Avalanche a top-20 cryptocurrency. AVAX trades around $17 with a 52-week trading range of $13.79 to $146.22.
Binance Coin (BNB)
Excluding stablecoins, Binance Coin is the third-largest cryptocurrency by market cap — behind only Bitcoin and Ether — valued at about $48 billion. As the largest global crypto exchange, Binance is uniquely positioned to benefit from crypto’s steady growth in popularity over time. Binance’s own thriving ecosystem uses BNB Coin as the core underlying currency of its blockchain. As of Oct. 5, trailing 24-hour volume on Binance was $14.7 billion, dwarfing the next-largest mainstream competitor, Coinbase Global Inc. (COIN), with a volume of $1.5 billion. Unlike the money supply of traditional currencies, which tends to ceaselessly grow over time, BNB actually takes a portion of transaction fees and “burns” them on a quarterly basis, reducing supply and increasing scarcity. Trading around $290, BNB has a 52-week trading range between $184.54 and $669.35.
Cosmos (ATOM)
ATOM is the native token of the Cosmos Hub blockchain. As a governance token, owning the coin also gives its holders a say in how the project should proceed. A top-25 cryptocurrency by market cap, ATOM has a trading history going back to 2017 — a solid track record in this young field. As one might be able to tell from this list alone, there are a lot of separate blockchains already in existence, and that fact gives Cosmos’ goal all the more relevance. Cosmos aims to make blockchains more developer-friendly, and also hopes to directly enable more seamless communication between different blockchain networks. Trading around the $13 level today, ATOM has a market cap of $3.8 billion and a 52-week trading range between $5.59 and $44.52.
Filecoin (FIL)
The last of the best cryptocurrencies to buy is Filecoin, the smallest by market cap of any name on this list. That said, Filecoin isn’t brand-new by any means, with a track record going back to 2017. As with Cosmos, Filecoin is a bit more speculative than other names on this list, but its unique project ambition makes it worth a watch. Filecoin is a decentralized storage network with the stated goal of storing the world’s most important information, and its decentralized nature makes it uniquely suited for data someone might want to insulate from censorship. The system also makes data easy to retrieve, making it an ideal way to document alleged war crimes committed by Russia in Ukraine in real time, as Stanford’s Starling Lab is currently doing.
7 of the best cryptocurrencies to buy now:
— Bitcoin (BTC)
— Ether (ETH)
— Solana (SOL)
— Avalanche (AVAX)
— Binance Coin (BNB)
— Cosmos (ATOM)
— Filecoin (FIL)
More from U.S. News
15 of the Best Dividend Stocks to Buy for 2022
9 Upgraded Stocks to Buy in October
2022’s 10 Best-Performing Stocks
What’s the Best Cryptocurrency to Invest in Now? 7 Contenders originally appeared on usnews.com
Update 10/06/22: This story was previously published at an earlier date and has been updated with new information.
