A cryptocurrency is defined as virtual or digital money in the form of tokens or “coins.” Some cryptocurrencies have ventured into the physical world with credit cards or other projects, while the large majority has remained entirely intangible.
The “crypto” in cryptocurrencies refers to complicated cryptography which enables the creation and processing of digital currencies and their transactions in decentralized systems. Besides, it provides a more important feature: a common commitment to decentralization. Notice that teams, that build in mechanisms for issuance (mostly through “mining”) and other controls, develop cryptocurrencies as code. Cryptocurrencies are designed to be almost always free from government manipulation and control, although nowadays every individual or entity show interest in them. Altcoins are the cryptocurrencies modeled after Bitcoin, which often try to present themselves as modified or improved versions of Bitcoin. Although some Altcoins share some impressive features that Bitcoin does not, they may not match the level of security that Bitcoin’s networks achieve largely.
Although there are many cryptocurrencies in the market now, not all of them worth watching as some have little or no trading volume and some are at the start of the way. Here we introduce 8 of the top cryptocurrencies that worth watching in October 2021.
1. Bitcoin The First Best Cryptocurrency
- Market cap: over $323 billion
Bitcoin (BTC) is stored in a decentralized network and is the top original cryptocurrency based on a digital ledger known as a blockchain. Since it is an open-source cryptocurrency, anyone can hold a share of it. It was created in 2009 by someone under the pseudonym Satoshi Nakamoto. It uses a proof-of-work (PoW) model, where miners solve mathematical equations and receive a digital coin as a reward. The PoW system securely sequences the transaction history of Bitcoin on the blockchain.
The most important feature of this cryptocurrency is its hard cap so that only 21 million Bitcoin can ever be mined. The rate of mining new Bitcoin reduces every four years by 50%, which also leads to increases in Bitcoin’s price (as, in theory, demand is the same, but supply is limited).
In late 2021, Bitcoin hit a historic high of over $1 trillion in market capitalization. This rise in value made it the first and only cryptocurrency to enter the $1 trillion region. However, the poor performance of the crypto market in 2022 sent the cryptocurrency down a steep decline. The cryptocurrency shed most of its worth, and a token now costs around $16,000. Nonetheless, the cryptocurrency remains the largest in the world.
2. Ethereum (ETH) The Second Best Cryptocurrency
- Market cap: over $149 billion
Like Bitcoin, Ethereum was built around a peer-to-peer network focused on a programmable blockchain. This means that Ethereum-based apps can be used for several digital assets besides money. Therefore, Ethereum could be compared to the Internet with more functionality and versatility than Bitcoin.
Ethereum is notably associated with the rise of NFTs, also known as Non-Fungible Tokens. NFTs provide the opportunity to trade the original version of a digital asset, like a picture or song, with proof of ownership, by keeping a record of ownership of the original piece. Currently, Ethereum hosts many of the most popular NFT collections, like Bored Ape Yacht Club (BAYC).
Although Ethereum has no maximum supply cap, transaction fees cause “burn up” in Ethereum, and the digital coins are accordingly taken out of circulation with a deflationary effect. Thus, investors in Ethereum will want to keep an eye on any changes to the rate of Ethereum growth.
Earlier this year, Ethereum transitioned from a proof-of-work blockchain to a proof-of-stake blockchain, thereby cutting down on its carbon footprint.
- Market cap: $66 billion
Unlike other cryptocurrencies discussed, Tether is a stablecoin backed by fiat currencies such as U.S. dollars or euros. It is hypothesized that Tether keeps a value equal to the dominating currency, making it more consistent than other cryptocurrencies. It attracts the attention of investors who consider the extreme volatility of different crypto coins too risky.
In mid-2022, stablecoins came under scrutiny after Luna, another stablecoin, crashed in days. The crash wiped $17 billion off the crypto market and left investors with worthless tokens. However, unlike Tether, Luna is an algorithmic-based stablecoin that isn’t backed by a fiat currency. Thus, fiat-backed stablecoins such as Tether and Circle could course the crypto winter and maintain their value.
- Market Cap: $44 billion
USDC is the second-largest stablecoin in the world. Much like its rival Tether, USDC is pegged to the US dollar on a one-on-one basis. At every time, the value of a single USDC token is expected to be equivalent to the dollar. To ensure the token remains pegged, the team behind the token maintains a reserve made up of fiat currencies and short-dated treasuries.
Like Tether, USDC can be deployed for multiple purposes, such as trading, payment of assets, and other on-chain/off-chain transactions between users.
- Market Cap: $39 billion
Before moving to its blockchain, Binance Chain, Binance Coin (BNB) was developed as an Ethereum-based token. It is known as the first coin to transact solely with other cryptocurrencies and not with fiat money. It was primarily used on Binance as a native currency for trading crypto and paying fees. Although it was launched in 2017, BNB is ranked fifth on the list of biggest cryptocurrencies by market cap.
Many smaller digital assets can’t be traded on a major exchange such as Coinbase; therefore, Binance Coin aims to create a way to exchange Bitcoin, Ethereum, and other coins for these smaller players. It also includes lower transaction fees, making it a useful tool for active investors in smaller cryptocurrency projects. Accordingly, it has been the most-used blockchain for active and unique wallets.
6. XRP (XRP)
- Market cap: Over $44 billion
XRP is used on a network similar to ripple to facilitate exchanges of different currency types, including fiat currencies and other major cryptocurrencies, which is widely required in the market today. The price of XRP was $0.006 in 2017 but reached $0.94 in 2021, equal to a rise over 15,700%.
7. Binance USD
- Market Cap: $17 billion
Binance USD is a stablecoin pegged to the dollar on a 1:1 basis. It was created via a partnership between crypto exchange giant Binance and Paxos.
BUSD functions like all other stablecoins on this list. The stablecoin is a good option for crypto investors without the heart for volatility associated with major cryptocurrencies. Thus, through stablecoins, they can prevent that risk since every unit of the token they hold is backed by a reserve.
Due to Binance’s influence in the crypto market, BUSD quickly grew in popularity. It is a popular choice for trading on the crypto exchange. So long as Binance maintains its relevance in the market, the stablecoin is considered a top cryptocurrency.
8. Dogecoin (DOGE)
- Market cap: $11 billion
Dogecoin first was introduced to cryptocurrency market in 2013. It was one of the most popular cryptocurrencies to buy last year. Dogecoin is even a better choice to invest in this year. Elon Musk often tweets about the crypto and its potential which encourages lots of investers to have some Dogecoin in their digital wallet.
At the beginning of 2021, Dogecoin only costed around $0.002. However, only in five months, it reached $0.75 per coin, which offered over %19,000 gains. Few months later, Dogecoin faced a downturn to %0.13. And the fluctuation continued, not sharp though, according to the crypto market.
The long term analysis of the market suggests that Dogecoin price estimates to reach about $1 by the end of 2022. Many experts see Elon Musk as the main supporter of the coin and find it profitable to buy Dogecoin as a long term investment.
9. Cardano (ADA)
- Market cap: Over $67 billion
Recent to the crypto sense, Cardano is recognized for its early acceptance of proof-of-stake validation. This method causes faster transaction time and less energy usage and environmental impact through omitting the competitive, problem-solving aspect of transaction verification seen with Bitcoin. Like Ethereum, Cardano also enables smart contracts and decentralized applications, which are powered by ADA. Although it might seem that Cardano’s ADA token had slow growth compared to other major crypto coins, its price increased from $0.02 in 2017 to $2.10 in 2021 which means over 10,500% increase.
10. Polygon (MATIC)
- Market Cap: $6 billion
Polygon (MATIC) is a cryptocurrency token used to govern and secure the Polygon network. The token is also used to pay transaction fees, vote on decisions in the network, and also used for staking. Likewise, it is also given to validators for confirming and verifying transactions in the Polygon network.
The maximum token supply of MATIC is capped at 10 billion tokens, most of which have been issued already.
- Market cap: over $84 billion
Litecoin (LTC) also operates as a peer-to-peer currency and uses a fully decentralized network with near-zero transaction fee. Litecoin is also measured as one of the biggest cryptocurrencies by market cap. It features faster transaction times and improved storage efficiency, supporting more transactions, faster confirmation times, which makes it shorter for the transaction to be confirmed by a miner. LTC has a hard cap of 84 million coins, four times more than Bitcoin, with better cost advantages and superior processing speed.
To sum up, LTC could provide lower-priced, higher-utility due to similarities and improvements over Bitcoin, along with a far lower price.
12. Solana (SOL)
- Market cap: Over $41 billion
Solana was developed to help power decentralized finance (DeFi) uses, decentralized apps (DApps) and smart contracts. It works on a unique hybrid proof-of-stake and proof-of-history mechanisms that help quicker and more secure process transactions. The platform is empowered by SOL, Solana’s native token. Although it was introduced to crypto list in 2020, SOL’s price started at $0.77but reached almost $140 in the present time, a gain of about 18,000%.
A good analyze of crypto market is necessary before investment as this market is open to many new comers both as investors and new cryptos.
13. Uniswap (UNI)
- Market cap: $6 billion
Uniswap is believed to be the most popular and valuable decentralized exchange token to invest in as a long term project. It is one the three largest valuable DeFi technologies in 2021. Uniswap provides a business model by creating an online marketplace relative to NFTs and Metaverse which allows trading in a decentralized manner.
Due to the recent interference of the governments with regulated centralized exchanges, many investors have shown their interest to invest in Decentralized tokens such as Uniswap. It seems that the market sees DeFi cryptos as the future. Accordingly, by the end of 2021, Uniswap had over 2.5 million users worldwide, though the number was a little less than 1 million in 2020 [1,2]. Uniswap has been massively active and dynamic in 2022 and is expected to show more efficiency in near future as the news indicated a shift in the Ethereum, Uniswap’s base layer, to a more effective PoS consensus algorithm.