In May 2022, the cryptocurrency market will be even more lucrative than it was in 2018, and there will be more projects available to invest in. So, which are the best cryptocurrencies to invest in? Let’s take a look at the top 7 to invest in, based on their current and future developments, so you can choose the right one for your portfolio this year.
Should you invest in Bitcoin?
In August 2017, Bitcoin set a new all-time high. At $4,738 per coin, it was worth nearly three times as much as an ounce of gold. Some analysts were convinced that Bitcoin had finally conquered its decades-long reputation for extreme volatility and moved into a period of stability where it would soon replace gold as humanity’s preferred investment vehicle. Now we have our answer: After hovering between $6,000 and $8,000 since early February 2018 (with most of those gains coming before March), Bitcoin took a big dip at the end of April and is currently trading for about $5,100. It seems Bitcoin is back to its old ways. But does that mean you should stay away?
Each time Bitcoin has crashed, it’s come back stronger. After losing nearly 50% of its value between June and October 2011, it rallied all the way back to $10 by November. It took nearly three years for another crash—down more than 90% between December 2013 and January 2015—but since then, Bitcoin has notched a gain of more than 900%. The question is whether it can continue that trend. Past performance is no guarantee of future results, but if past is prologue, we should see an eventual recovery.
What about Ethereum?
A lot of people think of Ethereum and Bitcoin as rivals, but there are some key differences between them. For one thing, Ethereum is designed for applications that require smart contracts—software rules that automatically execute when certain conditions are met. Most businesses won’t need that kind of advanced functionality. But for large organizations with a distributed workforce and other complex requirements, it could be helpful. And just like Bitcoin, you can use Ether to buy or sell computing power via cloud-based systems like Amazon Web Services (AWS). The network also uses blockchain technology to protect user identities from prying eyes.
What about Ripple?: Bitcoin may get most of the press, but there are plenty of other cryptocurrencies worth keeping an eye on. Some—like Ethereum and Litecoin—have similar features, such as blockchain technology and distributed ledgers. Others—like Ripple—are more ambitious projects that take a different approach. The currency started out as something of a joke but gained popularity quickly. Today it has a market capitalization of $93 billion (USD). And while its price spiked dramatically at one point, it’s calmed down somewhat over time. What makes Ripple so special? One big advantage is speed: transactions only take seconds instead of minutes or hours, making it more useful for payments than many other cryptocurrencies with lower transaction fees to boot.
Other crypto investments worth looking into
The purpose of a top cryptocurrencies list is to help put things into perspective. The crypto market is huge, and there are way too many coins and tokens being created every day. It’s impossible to know them all, let alone figure out which ones will be winners over time. With that said, here are some of our favorite altcoins that didn’t make it into our list of top picks but are still worth mentioning as we close out 2018: Stratis (STRAT), NEO (NEO), Cardano (ADA), Stellar Lumens (XLM) and Bitcoin Cash (BCH). These alternatives aren’t listed in any particular order; they are all valuable investments in their own right.
Bitcoin Cash (BCH) – BCH is one of a growing number of crypto coins with something called on-chain scaling. It allows for faster transaction speeds, bigger blocks and lower fees. Bitcoin Cash first launched in August 2017 as a hard fork from Bitcoin, but it uses an entirely different mining algorithm and offers eight times as many coins—making it worth nearly $400 apiece. Even if you don’t want to buy BCH now, it’s worth keeping your eye on as more exchanges accept them and their popularity grows.
Cardano (ADA) – Cardano is a decentralized public blockchain and cryptocurrency project that was founded by Charles Hoskinson, one of Ethereum’s co-founders. One of its best features is that it has a robust algorithm called Ouroboros that reduces power consumption, which makes it extremely efficient as well as better for mining. The ADA token currently has a market cap of $4 billion. Despite its potential, it’s still relatively new on the market—the first ICO for ADA only took place at the end of October 2017. Like BCH, you can expect to see more exchanges adopt Cardano and increase its popularity over time.
One coin to watch
EOS. The EOS platform was designed and created by Dan Larimer, who is widely known for co-founding BitShares, Steemit and other blockchain-based technology. Interestingly enough, he stepped down as Steemit’s chief technology officer at some point last year; so it’s anyone’s guess as to whether he plans on remaining involved with EOS development. And if you do have a stake in EOS—aside from Larimer—you can bet there will be strong community support for ensuring its future success.
Another big cryptocurrency that has caught a lot of people’s attention is EOS. This token has benefited from its affiliation with a top blockchain platform creator, who decided to take his talents and create something new for himself. And it’s working out quite well so far. Unlike Bitcoin and Ethereum, which are mainly used as currency and not much else, EOS has some pretty wide-ranging plans for their token. For one thing, it’s currently being traded primarily as an asset; so even if you don’t see too many transactions taking place with its underlying platform, there’s still opportunity in owning EOS tokens themselves.
The best cryptocurrency platforms
So, you want to trade cryptocurrency? That’s great! But what are your options? Most of us don’t have time for trading, and it can be hard to figure out which platform is best for your goals. It helps if you consider a few factors before you start. For example, if privacy is important, make sure that all exchanges can protect your identity. Some exchange platforms also allow cash deposits into accounts, as well as an easy way to get funds back out. If a user doesn’t mind paying fees each time they trade and never wants their account frozen by an exchange without warning, then centralized exchanges might be their best option. Otherwise, most decentralized ones may be right for them instead.
What about taxes? The IRS views cryptocurrencies as property, which means you have to pay capital gains tax whenever you sell a coin for a profit. Any cryptocurrency transaction that takes place on an exchange is technically a taxable event. Exchanges are required by law to report these transactions so investors can be taxed accordingly, though it’s worth noting that not all exchanges follow through with these reports. If users keep their coins off of exchanges, it’s possible they could avoid paying taxes altogether. It’s always best to stay up-to-date on all federal and state guidelines when trading cryptocurrency rather than relying solely on rules set forth by one or two specific exchanges or websites.
Crypto market regulation in your country
If you’re in a country where cryptocurrencies are not regulated or taxed, it’s definitely a good idea to familiarize yourself with existing regulation and any potential tax laws. Take Japan as an example, where exchanges must pay 8% sales tax on all purchases. If you aren’t paying attention, you could buy at market price and incur a hefty bill. In crypto taxes, there are no easy answers; regulations vary widely from place to place, so do your homework.
You should also keep an eye on any upcoming laws that might be relevant to your business. For example, if you’re dealing with cryptocurrencies, it’s essential that you stay informed about any developments at national and local levels. Government agencies may not always keep you in-the-loop; they often don’t want people avoiding taxes or hiding transactions (see our crypto market regulation guide). That said, there are benefits to knowing what’s coming down the line. It can help you plan ahead, consider options and choose a jurisdiction where your business model will be viable.
Benefits of investing and trading
It is important to understand that cryptocurrency investing and trading (or any other market) does not exist in a vacuum. There are real-world ramifications that come with every decision, trade, and transaction. Cryptocurrency investors will have their ups and downs, just like everyone else, but that’s part of what makes markets so exciting. It allows for rapid growth or even catastrophic loss as well. Understanding these risks is key when deciding how you want to invest your hard-earned money. Here are some pros and cons of cryptocurrency investing .
There are many reasons why someone would choose to buy cryptocurrency. Some may do it out of curiosity, others because they believe they can make a profit on an investment, while others might be compelled by fear of missing out on an opportunity they think is too good to pass up. Whichever reason you decide on, there are several factors that need to be considered before making any decisions about which cryptocurrencies or ICOs (initial coin offerings) look most promising.
When considering which cryptocurrencies or ICOs to invest in, there are four main things you should consider: 1) The team behind it; 2) The technology and its use case; 3) How much money has already been invested into it; 4) What value does it provide? In order to help you with your decision-making process, we’ve put together a list of what we think are some of the best cryptocurrencies and ICOs for investing in 2022
There are many different ways to invest in cryptocurrency. You can go long or short with CFDs , trade futures , trade stocks , trade options , or even use leverage . And if you’re looking for something more hands-on, then you could always mine crypto instead!