Top 10 Cryptocurrencies: A Short Introduction
It’s good to start investigating the cryptocurrency landscape with the top 10 coins by market capitalization: together they make about 85% of the total crypto market value.
However, it’s not just about the numbers. These coins represent the diversity of the whole crypto world:
- Bitcoin is a store of value and is considered by many the top crypto to invest in,
- Ethereum and Binance coin fuel powerful platforms for developers and traders,
- Tether and USD Coin are stablecoins — tokens whose price is always $1,
- Cardano and Polkadot were created by the co-founders of Ethereum to advance the capabilities of blockchain,
- XRP powers instant remittances for banks,
- Dogecoin is a meme coin that was created as a joke but gained as much traction as no one would expect,
- Uniswap is a governance token of the self-titled decentralized exchange on Ethereum.
Before we look at these coins in more detail, let’s see what happened to the entire crypto market in general in the last weeks.
What’s going on with crypto right now?
The last 3 months were quite tough for the crypto market. After the spring’s “moon” when Bitcoin reached its all-time high at $64,800, the market got “overheated”, the crypto assets were overbought. In mid-May, many coins lost 30-50% of their value in just 3 days. A few factors led to this: Tesla announcing it wouldn’t accept Bitcoin as payment anymore; China cracking down on Bitcoin miners, which significantly decreased activity level (hashrate) in the Bitcoin network.
Clearly, events related solely to Bitcoin can affect the whole crypto industry. Many coins strongly correlate with Bitcoin while its dominance (share of the whole crypto market) remains at the high level of 46.5%. The current dump was not only caused by Bitcoin, though.
Many experts stay positive on the long-term future of crypto; however, it’s still unclear when we should expect major growth — this month, this year, or later.
Now, let’s review the top-10 crypto coins.
1. Bitcoin (BTC)
Price: $45,601
Market cap: $847.33B
The first-ever cryptocurrency launched in 2009, Bitcoin remains the pillar of the crypto space that has never given up its first position. The coin was created by a pseudonymous developer Satoshi Nakamoto whose identity still remains unknown.
With Bitcoin, Nakamoto wanted to create a peer-to-peer system of value exchange that would be independent of any centralized authority (bank or government), public, transparent, anonymous, and immutable. Satoshi criticized central banks for boosting inflation and made Bitcoin inflation-proof: the total supply is limited by 21 million coins, making the asset scarce.
Today, Bitcoin is mostly used by long-term investors and traders: it’s rather a store of value than a means of daily payments. The recent price dynamic of Bitcoin is rather controversial and doesn’t allow making clear predictions.
2. Ethereum (ETH)
Price: $3,092
Market cap: $359.22B
Ethereum is the second pillar of the crypto space. It is a platform that allows developers to build decentralized applications (dApps): programs that look like regular apps but run on the blockchain. These applications are fueled by their native tokens — cryptocurrencies also based on the Ethereum blockchain. Ether (ETH) is the coin in which all transaction fees on Ethereum are paid.
Most prominent dApps include financial services for borrowing and lending (MakerDAO, Compound, Aave), cryptocurrency exchanges (Uniswap, SushiSwap), games (Axie Infinity, Decentraland), NFT marketplaces (Opensea, Rarible). Openness to developers, good decentralization, and governance attracted millions of users to Ethereum, making it the second crypto by market cap.
Lately, competitors such as Binance Smart Chain have been challenging Ethereum's dominance, so the coin is upgrading to Ethereum 2.0: a more efficient version of the platform. This pushes the ETH price up – some experts expect up to $5K for Ethereum by the end of 2021. Hence, it’s often considered the second top cryptocurrency to invest in.
3. Tether (USDT)
Price: $1.00
Market cap: $62.48B
One of the main drawbacks of cryptocurrencies is their volatility: even the major coins can pump and dump by 10-20% overnight. This repels many investors and businessmen who are having hard times setting their prices in crypto.
Stablecoins solve this problem. They are crypto tokens whose value is pegged to fiat (regular) currencies like US Dollar, metals like gold, etc. Tether is one of such assets. It’s based on Ethereum, Binance Chain, and Tron blockchains and always costs $1. Crypto enthusiasts use Tether to wait out volatility periods and take trading profits: if you expect Bitcoin to drop in price soon, you can swap it to Tether and then buy BTC again when its price is supposedly at the bottom. So, one would see Tether not as top crypto to invest in, but a kind of safe-haven asset.
4. Binance Coin (BNB)
Price: $353.67
Market cap: $59.02B
What do you know about Binance? It’s not only one of the biggest cryptocurrency exchanges that offers a good trading experience and security level. Besides that, there are Binance Chain and Binance Smart Chain — separate blockchains for building dApps like Ethereum.
Binance coin is the native cryptocurrency of all these platforms: fees for transactions on them are paid with BNB. This asset showed a drastic surge in the latest bull run and for many investors, it’s a top cryptocurrency to invest in. Currently, BNB is about 50% lower than its all-time high.
5. Cardano (ADA)
Price: $1.46
Market cap: $46.59B
Cardano was created by an Ethereum co-founder with the purpose to build a faster blockchain with scientifically proven security. The protocol aims to make Cardano interoperable (which will connect different blockchains) and a good means of value exchange.
Although Cardano is still under development since 2017 and does not have clear use cases yet, it has a very strong and dedicated community that believes in the project. Investors also like ADA: there is even some data that they are more bullish about Cardano than about Bitcoin.
6. Ripple (XRP)
Price: $0.82
Market cap: $37.69B
One of the core ideas behind cryptocurrency is its efficiency and speed compared to traditional finance. If you send crypto to your neighbor or to a friend who is 5,000 miles away, it will reach them in minutes or seconds with the same fee. On the contrary, if you use a bank to send money abroad, it will take the transfer several days to make its way through many intermediaries each of which charges their fees.
Ripple is the platform that allows banks to send payments abroad to other banks instantly at a low cost. XRP is the native cryptocurrency of this platform, and it’s on the list of the best crypto to invest in. Currently, XRP is considered by many undervalued — partly because of its trials with the American financial regulator SEC.
7. Dogecoin (DOGE)
Price: $0.25
Market cap: $33.01B
In a technical sense, Dogecoin is quite similar to Bitcoin: its code is the direct successor of Bitcoin’s. The purpose of its creation, however, was absolutely different: Dogecoin was meant to be a meme coin.
Things changed when the coin attracted an eager community trying to pump it. After Elon Musk came into play with a number of tweets about Dogecoin, the cryptocurrency skyrocketed. But although the “DOGE for $1” slogan doesn’t seem as impossible now, the coin remains an extremely risky investment due to its volatility.
8. USD Coin (USDC)
Price: $1.00
Market cap: $27.77B
Remember Tether at the 3rd position? Although it’s widely used by crypto traders, there is one problem with it. USDT lacks transparency: it’s not frequently audited, and experts aren’t sure if it is fully backed by the real fiat Dollars lying in vaults (the way it’s supposed to be).
USD Coin is a different stablecoin. It’s surely backed 1:1 by US Dollars, which is checked in monthly audits by the Grant Thornton LLP accounting firm. Besides Ethereum, USDC also runs on other platforms such as Stellar and Solana.
9. Polkadot (DOT)
Price: $20.53
Market cap: $19.92B
Currently, blockchains like Bitcoin or Ethereum exist separately from each other. They are very different and can’t exchange data and value directly. Polkadot aims to solve this problem: it works on connecting different chains with bridges. Thus, you will be able to trigger a Bitcoin payment on Ethereum or initiate a cross-chain swap between, say, Tether and Cardano.
If Polkadot succeeds in building an interoperable decentralized internet, the future will be bright for the DOT cryptocurrency. Its current price dynamic correlates with the general trend: it collapsed in May and demonstrated moderate growth in July.
10. Uniswap (UNI)
Price: $27.92
Market cap: $16.27B
Uniswap is the biggest decentralized exchange on the Ethereum network that allows you to swap between all Ethereum-based tokens. With Uniswap, you don’t have to store your funds on the exchange to trade them: all transactions are performed directly between your wallet and Uniswap’s liquidity pools (smart contracts where funds are locked).
Uniswap token introduced decentralized governance in Uniswap: UNI holders have a say in the decisions regarding the protocol upgrades, fees, and more. The token is also used in yield farming, which overall has made UNI popular among investors and traders.
Bottom Line
Cryptocurrency revolutionizes global finance, and thousands of crypto projects do it in their own way. This article was a brief intro to the major cryptocurrencies (and many consider them the best cryptos to invest in), and now, you are welcome to dive deeper. See how Bitcoin and blockchain work, or, if you want to learn more about investing in cryptocurrency, see how to exchange cryptos with low fees.
