What is the next cryptocurrency to explode in 2021?
What coins can you buy right now to make it big in the near future?
These and more are the types of questions being asked by the many crypto bounty hunters who want to cash in on the historic run we have seen over the last few months.
The price of Bitcoin has gone from $5,300 USD to over $41,000 in less than 12 months (March 2020 – January 2021).
With that said, we have also seen the markings of what is truly a risky investment – price drops of 30% and higher within a matter of hours.
In your bid for the next big cryptocurrency, you should keep in mind that the long-term investment value of crypto-assets is no sure thing. You could make a lot of money or lose everything.
Related: Best Cryptocurrency Apps.
What are Cryptocurrencies?
A cryptocurrency is a digital currency or asset designed to facilitate the purchase of goods and services similar to fiat money.
Unlike traditional currencies that are controlled by a sovereign government’s Central Bank, cryptocurrencies are decentralized and are protected using cryptography.
Transactions involving crypto occur on a public ledger (Blockchain) which records them for verification and addition to the blockchain.
Today, there are thousands of cryptocurrencies with various missions, features, utility, and downsides.
What is Bitcoin?
Bitcoin is the most popular cryptocurrency in the world and the one with the highest market capitalization – over $661 billion as of January 10, 2021.
The idea of Bitcoin was first introduced by Satochi Nakamoto in 2008 (real identity of the founder is unknown).
Several other crypto coins have since been designed to mimic Bitcoin. These Bitcoin alternatives are referred to as “altcoins”.
What Cryptocurrency Will Explode Like Bitcoin in 2021?
The next crypto winner is anyone’s guess. Given that there are over 7,000 coins out there on the interwebs, there is no easy way to analyze them all.
One option for streamlining your choice is to take a look at its public appeal as measured by the coins market capitalization.
The top-9 digital assets like Bitcoin based on this metric as of January 2021 are:
1. Ethereum (ETH)
Ethereum is a decentralized blockchain that uses Ether as its native currency.
The Ethereum blockchain is used to facilitate smart contracts and it serves as a platform for creating and running other crypto-coins.
Ethereum was first introduced by Vitalik Buterin in 2013. It had a market cap of over $119.63 billion as of January 11, 2021.
Learn more about Ethereum here.
2. Ripple (XRP)
The RippleNet platform is a digital payment network and protocol that is used by many banks for processing global transactions.
The company also created a native token known as XRP and it is based on an open-source blockchain known as the XRP Ledger.
XRP transactions are completed very fast (3-5 second) compared to Bitcoin which takes several minutes. It also uses very little energy.
XRP was first launched in 2012. As of January 12, 2021, it had a market cap of $13.20 billion.
Learn more about XRP here.
3. Cardano (ADA)
Cardano uses the Ouroboros peer-reviewed blockchain protocol to facilitate secure payments and protect privacy. Its currency is known as ADA.
Cardano uses a “proof-of-stake” consensus mechanism to verify transactions on the blockchain which is more efficient compared to the “proof-of-work” system used by Bitcoin and Ethereum.
Cardano was founded by Charles Hoskinson in 2015. As of January 12, 2021, ADA had a market cap of $8.91 billion.
4. Litecoin (LTC)
Litecoin was founded by Charlie Lee in 2011, a former Google employee. It is a peer-to-peer internet currency similar to Bitcoin, although its Blockchain can handle faster transactions.
The maximum litecoin that can be produced on the network is 84 million. Litecoin’s market cap as of January 12, 2021, was $11.14 billion.
5. Bitcoin Cash (BCH)
Bitcoin Cash was created via a hard fork of Bitcoin in 2017. It is a separate cryptocurrency and is limited to a supply of 21 million coins.
Bitcoin Cash had a market cap of $9.39 billion.
6. Polkadot (DOT)
Polkadot was founded by Gavin Wood, Peter Czaban, and Robert Habermeier. Its token is referred to as DOT.
The Polkadot platform and architecture is used to facilitate the operation of other blockchains and cryptocurrencies.
DOT had a market cap of $7.27 billion as of January 12, 2021.
7. Stellar (XLM)
This decentralized payment protocol facilitates global payment transactions between currencies – both fiat and digital at a low cost. It was founded in 2014 by Jed McCaleb (Ripple co-founder) and Joyce Kim.
The Stellar network has been used in various real-world applications including micro-financing, non-cash remittances, and other digital infrastructures.
Its market cap as of January 12, 2021, was $6.14 billion.
8. Binance Coin (BNB)
Binance coin was launched in 2017 and is the token issued by Binance, one of the world’s largest cryptocurrecies exchanges.
It is a stable coin and was initially built on the Ethereum blockchain. It now works on the Binance Chain.
Binance Coin had a market cap of $5.35 billion on January 12, 2021.
9. Bitcoin SV (BSV)
Bitcoin SV was created as a result of a hard fork of Bitcoin Cash in 2018. Similar to BTC and BCH, it will have a maximum supply of 21 million coins.
Bitcoin SV had a market cap of $3.65 billion as of January 12, 2021.
Ten other coins that have been trending a lot in recent times are:
- Monero (XMR)
- TRON (TRX)
- NEM (XEM)
- TEZOS (XTZ)
- Neo (NEO)
- VeChain (VET)
- Dash (DASH)
- Cosmos (ATOM)
How To Buy Cryptocurrency in Canada
There are many crypto exchanges and platforms offering trading in the popular coins.
1. Wealthsimple Crypto: This platform is owned by Wealthsimple and offers trades in two coins (BTC and ETH).
2. Coinsmart: This exchange offers access to 11 coins. It also allows credit card funding in addition to Interac e-Transfer, EFT, and bank wire.
3. Bitbuy: This crypto exchange can be used to buy and sell 7 different coins.
You can open an account here.
Should You Invest in Cryptocurrency?
While we have listed the top cryptocurrencies based on their market capitalization as of this writing, these top contenders are always in flux due to the fast-paced nature of the cryptocurrency market.
Given its speculative nature, investing in cryptocurrencies is not advisable for many people, especially if you are using funds you cannot afford to lose.