In a span of just 15 years, cryptocurrencies emerged from obscurity to become an important part of financial markets. But there’s one thing the industry’s evolution hasn’t eradicated: extreme volatility.
At its peak in November 2021, the crypto market was worth upwards of $2.9 trillion. By mid-2022, hit by rising inflation and an aggressive rate-hiking cycle by the Federal Reserve, the entire market was worth less than $900 billion. Fast forward to July 30 of this year, and cryptocurrencies collectively were worth $2.4 trillion.
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That’s quite a roller coaster. If you’re not willing to endure such violent swings, you simply shouldn’t own cryptocurrencies. And if you do get into crypto, there are thousands of coins to choose from, each one with different dynamics. It’s daunting. Here are six of the best cryptocurrencies to buy now:
— Bitcoin (BTC)
— Ether (ETH)
— Solana (SOL)
— Avalanche (AVAX)
— Polygon (MATIC)
— Cardano (ADA)
Bitcoin (BTC)
Cryptocurrency is an incredibly nascent asset class, with origins only dating back to 2009. Extreme volatility is par for the course, so investors looking to insulate themselves from the potential total collapse of their holdings will want to go with more established names. None is more established than Bitcoin, the first cryptocurrency and largest by market capitalization with a valuation of about $1.3 trillion, or roughly 55% of the overall market.
BTC boasts the most mainstream acceptance of any of the top cryptocurrencies, as evidenced by the January debut of 11 new Bitcoin exchange-traded funds, or ETFs. The fight with the Securities and Exchange Commission to approve spot Bitcoin ETFs was years in the making, but the approval finally materialized. Bitcoin ETFs have ushered in a new chapter for the leading crypto, as mainstream investors can now track its performance without having to directly own the “digital gold” itself.
After languishing below $17,000 at the beginning of 2023, less than two years later Bitcoin now trades for upwards of $66,000, having fiercely rallied in 2024. Through July 29, Bitcoin prices are up 58.1% year to date, driven largely by the approval of spot Bitcoin ETFs, which quickly attracted billions of dollars in assets under management.
The other catalyst for BTC is the Bitcoin halving event that occurred on April 19, when rewards for mining Bitcoin were cut in half. It’s a process that happens roughly every four years and goes hand in hand with Bitcoin’s scarcity; within 18 months of previous Bitcoin halvings, the price of the token has rallied fiercely.
Ether (ETH)
Second by market capitalization is Ether, which is the native token on the widely used Ethereum blockchain. Often colloquially referred to as Ethereum, ETH’s market cap is about $400 billion and accounts for nearly 17% of the total cryptocurrency market. Unlike Bitcoin, Ether’s underlying network is far more than just a tool for peer-to-peer payments; the Ethereum blockchain is custom-made for smart contracts and decentralized finance tools, as well as for so-called Web3 applications and the trading of non-fungible tokens, or NFTs.
While Bitcoin only functions as a speculative asset and a store of value, Ether has inherent utility as the native token of a wildly popular network. Plus, Ethereum’s switch in recent years from the energy-inefficient proof-of-work protocol to the much more efficient proof-of-stake system gives it a leg up on BTC in an increasingly environmentally conscious world.
Like BTC, ETH is up sharply so far in 2024, surging 45.5% through July 29. These two cryptos are undoubtedly the best in their asset class. To the surprise of many, the SEC greenlit spot Ether ETFs this year, and a handful of them began trading in late July.
[Read: The History of Bitcoin]
Solana (SOL)
Like Ethereum, Solana is a blockchain that was built with utility in mind. In Solana’s case, it’s become known for facilitating the easy creation of decentralized applications, or dApps, but the network is actually even faster than Ethereum, has far lower fees and is intended to be more easily scalable than rivals. The native token of this blockchain is the eponymous Solana, also known as SOL.
SOL didn’t start trading until 2020, but has had a meteoric rise to stardom in the years since. At the beginning of 2021, SOL accounted for just 0.01% of the crypto market’s total value. Come July 30 of this year, SOL makes up 3.54% of the multitrillion-dollar space, representing a more than 350-fold increase in its market share.
Excluding stablecoins, Solana is the third-largest cryptocurrency in the world, with a market capitalization around $83 billion. SOL’s enjoyed a great run in the first part of 2024, returning 80.1% through July 29. Aside from its low fees, ease of use and thriving ecosystem, Solana has recently attracted a lot of attention to its platform through the popularity of Solana meme coins, which are easy and cheap to create and trade. Dogwifhat (WIF) and Bonk (BONK), another dog-themed meme coin, are two of Solana’s most popular meme coins in 2024.
Avalanche (AVAX)
When investing in cryptocurrency, investors should understand that it’s Bitcoin and Ether in their own tier, and then there’s everything else. SOL, AVAX and the following altcoins on this list all have more risk, and investors should factor that into their decisions. Consider them purely speculative wagers.
Caveats aside, the Avalanche network’s AVAX token earns its place on this list by virtue of the ambitious goals of the Avalanche blockchain.
Avalanche’s subnets feature allows users to deploy their own mini-blockchains on top of its network. Developer Ava Labs envisions a future in which most mainstream commercial entities and even many individuals will want their own blockchains, with Avalanche subnets offering a convenient solution to that problem. If that reality materializes, then AVAX, which plunged 90% in 2022’s bear market, could emerge as a longer-term winner.
AVAX has surged over the past year, with prices more than doubling in that span, though AVAX is off 29.7% in 2024 as of July 29. Avalanche currently has a market capitalization of $10.5 billion.
Polygon (MATIC)
Excluding stablecoins, MATIC is now the 18th-largest cryptocurrency by market cap, with a capitalization of $5.2 billion. Still constituting less than 0.3% of the overall market size, Polygon has plenty of room to grow. That said, its future success is largely tied to the acceptance and ongoing usage of the Ethereum network. That’s because the Polygon network is a scaling platform that aims to increase the capabilities of Ethereum, allowing it to eventually run a potentially limitless number of dApps.
Recent performance has been, frankly put, rather ugly. The token is nowhere near its late 2021 highs and is down nearly 48% thus far in 2024, but MATIC, an old-school crypto by the market’s standards, could be a turnaround candidate. As part of its Polygon 2.0 plan, the project will upgrade its native token from MATIC to a new token called POL, though the prices of these tokens should be identical and exchangeable on a 1-for-1 basis.
MATIC is one of the riskier tokens on this already high-risk list, and it certainly doesn’t currently have momentum going in its favor. If you’re a long-term crypto investor, it’s worth having in the portfolio, but if you’re just short-term trading, there may be better options.
Cardano (ADA)
Founded in 2017 by Ethereum co-founder Charles Hoskinson, Cardano is a proof-of-stake blockchain and one of the largest blockchains to successfully run that more energy-efficient protocol. Cardano aims to foster a developer-friendly ecosystem for dApps. Unlike Ethereum, Cardano has a hard cap on the number of coins that can ever exist, topping out at 45 billion. Thankfully for investors, around 37.1 billion, or more than 82%, of that supply has already been issued, meaning the amount of overall dilution remaining is both known and relatively limited.
Cardano has managed to advance 60% since the beginning of 2023, when it was trading for 25 cents. It’s now trading for roughly 40 cents and boasting a market cap of more than $14 billion. Cardano is down 32% so far in 2024, so like Polygon, it’s more of a long-term hold than a short-term trader’s dream.
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6 of the Best Cryptocurrencies to Buy Now originally appeared on usnews.com
Update 07/30/24: This story was previously published at an earlier date and has been updated with new information.
