- Cryptocurrencies are one of the most volatile assets to invest in. However, they can also be the most rewarding.
- Five of the best cryptocurrencies to invest in are Bitcoin, Ethereum, Ripple, The Graph, and Binance Coin.
- Aside from those above, there are still more cryptocurrencies that have good investment potential.
Despite the doom and gloom of 2020, there have been a lot of good things that happened this year in crypto as well. First is the rise of decentralized finance (DeFi), BTC finally setting a new all-time high (ATH), and more. Moving forward, crypto users need to know the best cryptocurrencies to invest in 2021 to prepare for what’s coming ahead.
As we might have observed by now, crypto users that are uninformed about top cryptocurrency investments tend to lose out later on. For example, those who bought their BTC at $17,000 would have already gained $5,000 at the time of writing.
But those who buy BTC right now may not gain as much. Worse comes to worst, they may even lose in the next days to come.
We need to read many resources about the best cryptocurrencies to invest in next year to help us plan ahead. Nevertheless, take every information here with a grain of salt, especially since cryptocurrencies are extremely volatile.
Best Cryptocurrencies to Invest
In this article, we discuss 5 of the best cryptocurrencies to invest in 2021. These are chosen not because of their current performance, but on their foreseeable potential as observed through basic market metrics.
Bitcoin is undoubtedly the top cryptocurrency to invest in 2021. It already broke past its previous ATH of $20,000 from 2017, and only satoshi knows at what price it will settle.
One of the many factors that are helping Bitcoin’s price increase is its halving last May 2020. This means that miners will have lesser newly-minted bitcoins.
Another factor is that PayPal also enabled Bitcoin storage and payments on its platform. This will help Bitcoin achieve mass adoption since PayPal has innumerable users across the globe.
As the chart above shows, BTC underwent a consolidation period for a long time before finally letting the bulls win. In fact, the chart shows that BTC is well on its way to challenge the $25,000 psychological resistance level soon if the trend continues in its favor.
At the time of writing, BTC price is $23,649.01, according to CoinGecko. Its relative strength index (RSI) is at 77.51, which means that it is overbought. The last time that this happened was in November, which lasted for almost a month.
Nevertheless, Bitcoin is one of the best cryptocurrencies to invest in 2021 because of its market dominance. Despite not having the fastest blockchain in the world, it has proven itself as a good investment asset. Also, it went through a lot of bottoms in the past, yet it remains the top cryptocurrency today.
Ironically, many people believed that 2020 would be the year of Bitcoin. Little did they know that Ethereum would also have a steady rise this year. Also, others would argue that 2020 is the year of DeFi and that they’re contributing to BTC’s price increase.
From a meager $110 price in March, Ethereum has skyrocketed at least five-fold this year. At the time of writing, one ETH is worth $651.82, according to CoinGecko.
ETH will be a good cryptocurrency to invest in since a lot of DeFi platforms use its blockchain. Consequently, they will use ETH for many transactions and popular practices such as yield farming, staking, etc.
Popular DeFi platforms such as Uniswap, Chainlink, Aave, etc. also have strong market presence. In fact, other older crypto platforms including crypto exchanges and blockchain ecosystems are also developing their DeFi services. This shows that ETH will be one of the best cryptocurrencies to invest in 2021.
There is no doubt that XRP is one of the best cryptocurrencies to invest in 2021. Its stellar performance this year shows that it has enough support to catapult it into its current position.
Earlier this year, XRP was behind Tether (USDT) on crypto data sites CoinMarketCap and CoinGecko. However, XRP slowly overtook USDT this year despite having its March lows.
Prior to XRP’s price breakout, it suffered a prolonged consolidation period around the $0.20-$0.25 levels. When it did break out, it reached as high as $0.70 before settling at about the $0.50 to $0.60 range. We can expect XRP to undergo a short period of correction before it makes a sharp movement again.
Possible reasons for the XRP breakout are the following: XRP buybacks, new product releases, and increase of unique addresses.
Even if XRP falls back to key support levels, it will remain as a top cryptocurrency to invest in because of its use cases. For example, Ripple has partnered with a number of banks this year to provide various financial services.
The Graph (GRT)
Making its way to our list of best cryptocurrencies to invest in 2021 is The Graph. Compared to the first three, GRT is a new crypto asset that just got listed on exchanges. It describes itself as an indexing protocol for querying blockchain data through GraphQL.
At the time of writing, one GRT is worth $0.429937, according to CoinGecko. This doesn’t look very convincing at first. However, The Graph launched only on December 17. Despite this, many of the biggest cryptocurrency exchanges like Binance, Coinbase Pro, Huobi Global, OKEx, etc. have listed it.
Also, it appears that The Graph has many supporters who are willing to hype it and stay for the long run. On the other hand, it already stated its vision and started building its platform in 2018. This shows that the project, despite only getting hype just now, has thought its technology through.
According to CoinGecko, GRT has a 24-hour trading volume of $1.3 billion. It also has a market capitalization of $531 million. These strong figures show that GRT has a tremendous potential to become a good crypto investment asset in 2021.
Binance Coin (BNB)
Completing our list of the 5 best cryptocurrencies to invest in 2021 is Binance Coin. This doesn’t surprise anyone in the crypto community, as Binance is consistently the top crypto exchange.
BNB has a number of functions in the Binance ecosystem. Despite this, TokenInsight believes that BNB is undervalued.
Looking at a one-month perspective, BNB has had a very erratic movement. Its current price is $31.87, according to CoinGecko. But this movement is expected, based on our Binance Coin Prediction 2021 article.
However, looking at a macro perspective, BNB is gradually increasing, and will continue to do so for the foreseeable future.
As the chart shows, BNB has definitely increased since July. Its exponential moving average (EMA) has dramatically increased as well, with no signs of slowing down. This shows that despite possible correction periods, BNB will continue to rise in 2021. This makes it one of the best cryptocurrencies to invest in next year.
Cryptocurrencies are one of the most volatile assets to invest in. However, they have proven that they are the most rewarding investment for those who are patient and wise with their money.
These top 5 cryptocurrencies we mentioned can and will experience their lows. Hence, make sure to keep an eye out for buy and sell trends to make the most out of your investment.
Aside from the above-mentioned crypto assets, there are still more cryptocurrencies that have good investment potential. Try to diversify your portfolio and invest only the money that you are willing to risk.
Disclaimer: The views and opinions expressed in this article are solely the author’s and do not necessarily reflect the views of CoinQuora. No information in this article should be interpreted as investment advice. CoinQuora encourages all users to do their own research before investing in cryptocurrencies.