From Bitcoin and Ethereum right down to Dogecoin and Tether, there are literally thousands of different cryptocurrencies, making it quite overwhelming when you’re first getting started in the world of cryptocurrencies. To assist you get your bearings, these are the main cryptocurrencies based on their market capitalisation or the overall value of all the coins that are currently in circulation.
Created in 2009 by someone who adopted the alias Satoshi Nakamoto, Bitcoin (BTC) is the first cryptocurrency. As with a lot of cryptocurrencies, BTC functions on a blockchain or – alternatively – a ledger logging transactions that are distributed across a network of thousands of computers. As additions to the distributed ledgers need to be verified by solving a cryptographic puzzle, which is a process called proof of work, Bitcoin is secure and safe from swindlers.
Bitcoin’s price has increased rapidly as it’s developed into a household name. In May 2016, you were able to buy Bitcoin for about $500. Since then Bitcoin has seen many ups and downs but has shown enormous resistance. In 2022 Bitcoin lost 65% of its market value and now, as of 10 January 2023. Bitcoin is trading in the range of between $17 500 and $18 000.
Ethereum (ETH) is a decentralised software platform which enables smart contracts and decentralised applications (dApps) to be built and run with no downtime, fraud, control, or interference from a third party. The aim behind Ethereum is to create a decentralised collection of financial products that anyone in the world can access freely, regardless of nationality, ethnicity, or faith.
This feature makes the implications for those in some countries more compelling as those without state infrastructure and state identifications are able to gain access to bank accounts, loans, insurance or a number of other financial products.
The applications that are on Ethereum are run on ether, which is a platform-specific cryptographic token. Ether (ETH) is almost like a vehicle for moving around on the Ethereum platform and is sought mostly by developers who are looking to develop and run applications inside Ethereum, or now, by investors who are looking to buy other digital currencies using ether.
When learning how to invest in cryptocurrency it’s very important to understand that there are apparent tiers to the quality of digital assets. Bitcoin and Ether are generally considered the two safest and most established cryptos that are available.
Altcoins likely offer more potential upside and they also come with higher risk so should be considered to be highly speculative. Caveats notwithstanding, the Avalanche network’s AVAX token earns its place on the list because of the bold goals of its blockchain.
Avalanche’s subnets feature gives users the opportunity to implement their own mini-blockchains on top of its network. Developer Ava Labs envisages a future in which most of the mainstream commercial entities and even many people will want their own blockchains, with Avalanche subnets providing a convenient solution to that problem. If that reality materialises, then AVAX, which plunged 90% in 2022’s bear market, could come forth as a long-term winner.