Cryptocurrency is digital money that isn’t managed by a central system, like a government. Instead, it’s based on blockchain technology. Bitcoin is the most popular one. But as digital money continues to gain traction on Wall Street, more and more options become available.
You can use cryptocurrency to make purchases, but most people treat it as a long-term investment. However, volatility makes investing in cryptocurrency risky. This was demonstrated by the 2021-2022 freefall among cryptocurrencies, including stablecoins pegged to the U.S. dollar. It’s important to know what you’re getting into before you buy in.
10 Best Cryptocurrencies To Invest in for 2024
These are 10 of the best cryptocurrencies to invest in for 2024.
| Cryptocurrency | Price | Market Cap |
|---|---|---|
| Bitcoin (BTC) | $64,436.18 | $1.27 trillion |
| Ethereum (ETH) | $2,647.99 | $318.7 billion |
| Binance Coin (BNB) | $606.52 | $88.56 billion |
| Cardano (ADA) | $0.3912 | $14.07 billion |
| Polygon (PRO — Formerly MATIC) | $0.4122 | $3 billion |
| USD stablecoin (USDC) | $1.00 | $35.99 billion |
| Avalanche (AVAX) | $28.10 | $11.41 billion |
| Chainlink (LINK) | $12.31 | $7.72 billion |
| Solana (SOL) | $152.74 | $71.61 billion |
| Dogecoin (DOGE) | $0.115 | $16.8 billion |
1. Bitcoin (BTC)
- Price: $64,436.18
- Market capitalization: $1.27 trillion
- Year-over-year return: 145.87%
Bitcoin has been around for the longest of any cryptocurrency. It’s easy to see why it’s the leader, with a price and market cap that are much higher than any other crypto investment options.
Many businesses already accept bitcoin as payment, including:
- Visa
- Stripe, through its partnership with OpenNode
- Larger banks like Bank of America and Goldman Sachs
Several companies got Securities and Exchange Commission, or SEC, approval for the spot bitcoin exchange-traded funds, or ETFs. This is a major boon to bitcoin’s value as an investment asset. Spot bitcoin ETFs track the current price of bitcoin. Some of those ETFs are even being offered in overseas markets. BlackRock’s iShares Bitcoin Trust ETF, for example, is now trading in Brazil, reported CoinDesk.
Investors have been able to indirectly invest in bitcoin since 2021 through ETFs that held bitcoin futures contracts. The SEC decision approved ETFs that hold bitcoin itself. This gives investors a way to make direct investments in the cryptocurrency without having to buy or store their own coins.
It took just four days of trading for the iShares Bitcoin Trust ETF to reach $1 billion in assets, Reuters reported. It since has grown to nearly $23 billion. Fidelity’s Wise Origin Bitcoin Fund net assets stood at $10.52 billion on Sept. 24.
Risks of Investing in Bitcoin
The value of bitcoin tends to fluctuate a lot. You may see the price go up or down thousands of dollars during any month. That certainly was true in 2022, as bitcoin prices correlated to the Nasdaq. This challenged previous assumptions that bitcoin would serve as a hedge against inflation.
Prices have since soared, thanks in part to the SEC approval of bitcoin spot ETFs. But considering that they’re new funds, analysts can only speculate about the effect they’ll have on bitcoin values over the long term.
2. Ethereum (ETH)
- Price: $2,647.99
- Market capitalization: $318.7 billion
- Year-over-year return: 67.77%
Ethereum is a network that allows developers to create their own cryptocurrency and deploy smart contracts utilizing the network. Ethereum is far behind bitcoin in value, but its unique technology places it far ahead of the other competitors.
Even though it came out years after some other cryptocurrencies, it’s currently the most popular blockchain and the second-largest cryptocurrency behind bitcoin.
The cryptocurrency world anticipated that ethereum would gain even more ground following the deployment of an upgrade, nicknamed “The Merge.” This upgrade shifted the Ethereum network to a proof-of-stake-based consensus. The upgrade was anticlimactic for ETH holders, but it did pave the way for Ethereum’s future evolution in terms of:
- Scalability
- Cost reductions
- Security enhancements
Although ether doesn’t have the widespread acceptance bitcoin does, traditional companies are coming on board. Fidelity recently bulked up its tech workforce to create the infrastructure needed to offer ethereum custody and trading services to its customers, The Wall Street Journal reported. Other brokerages may follow. The SEC recently approved spot ether ETFs — making ethereum the only crypto besides bitcoin approved for trading within funds.
Risks of Investing in Ethereum
The Merge vastly improved Ethereum’s energy efficiency, but it didn’t resolve slow transaction speeds or high gas fees. Currently, the platform only has one “lane” for transactions. This can lead to transactions taking longer to process when the network is overloaded.
Transaction fees are also high. Fees won’t go down until Ethereum implements “danksharding,” which will require several upgrades. According to the Ethereum development site, proto-sharding will use rollups to reduce costs. Rollups bundle hundreds of transactions into one transaction on layer one and could reduce fees by up to 100x.
3. BNB (BNB)
- Price: $606.52
- Market capitalization: $88.56 billion
- Year-over-year return: 190.99%
BNB, formerly binance coin, has been a more stable investment. It’s the native token on Binance, the world’s largest cryptocurrency exchange. But despite its extensive functionality and the coin’s success in Binance sub-projects, BNB is still a highly volatile investment.
Binance also burns, or destroys, coins once per quarter. The most recent burn occurred on July 22. It reduced the coin supply by 1.64 million tokens — about $971 million worth at the time. It didn’t affect prices in the short term, but managing the number of tokens can have a positive effect over time by creating scarcity. BNB has a total supply of 145,933,380 — all of which are circulating.
It’s worth noting that Binance took a leading role in stabilizing the crypto industry following the collapse of the FTX exchange. It devoted $1 billion to a recovery fund established to keep struggling players afloat, CNBC reported.
Risks of Investing In BNB
BNB’s position as the native cryptocurrency on the world’s largest exchange “legitimizes” it in some respects. But it also makes the currency especially vulnerable to regulatory issues. BNB lost 7.3% of its value in June 2022 when news broke of a Securities and Exchange Commission investigation into whether Binance followed proper procedures in its 2017 initial coin offering, Fortune reported. The SEC has accused Binance of other wrongdoing, including commingling investor funds and using Binance.US as an unregistered exchange. The SEC fined Binance $4.3 billion in November 2023. The company’s CEO at the time, Changpeng Zhao, also pled guilty to violating anti-money-laundering requirements, The Wall Street Journal reported.
4. Cardano (ADA)
- Price: $0.3912
- Market capitalization: $14.07 billion
- Year-over-year return: 59.90%
The Cardano network has a smaller footprint, which many investors find appealing. It takes less energy to complete a transaction on Cardano than on a larger network like Bitcoin. This means transactions are faster and cheaper.
In 2021, Cardano launched an upgrade that increased functionality — in this case, enabling smart contract deployment. Another upgrade called Vasil launched in September 2022. It should improve the Cardano blockchain’s scalability, Mint reported.
Cardano recently launched a test version of a platform called AdaSwap, where developers can build decentralized finance apps. AdaSwap could elevate Cardano’s status as a Web3 network and drive up the price of its coin. The coin is No. 10 in terms of market value, but Cardano’s nonfungible-token protocol is the world’s second largest, according to U.Today.
Risks of Investing in Cardano
Even with a better network and the increased functionality smart contracts provide, cardano may not be able to compete with larger cryptocurrencies. If this leads to fewer adopters, it will mean fewer developers. This isn’t appealing to most investors, who want to see a high adoption rate.
The platform has launched an incubator that funds African blockchain startups and could help Africa reach its potential as a major economy. But it remains to be seen if it can live up to that potential.
Advice
Don’t be discouraged by fluctuations in the market. Your investment may lose money one day and make a profit the next. Instead of getting caught up in the day-to-day changes, look at the big picture.
5. Polygon (POL – Formerly MATIC)
- Price: $0.4122
- Market capitalization: $3 billion
- Year-over-year return: -36.11%
Polygon was created by a development team that made significant contributions to the Ethereum blockchain platform. Polygon is designed for Ethereum scaling and infrastructure development, according to CoinMarketCap. As a “layer two” solution, it expands Ethereum into a multi-chain system. This improves transaction and verification speed.
Polygon has backing from the Binance and Coinbase cryptocurrency exchanges. Its token, matic, is used for:
- Payment services
- Transaction fees
- A settlement currency
In July 2022, Polygon announced in a press release that it had launched Polygon zkEVM, “the first Ethereum-equivalent scaling solution that works seamlessly with all existing smart contracts, developer tools and wallets.” It does this with a type of cryptography called zero-knowledge proofs, which lower transaction costs and increase throughput.
Polygon hosts tens of thousands of decentralized apps, including some from companies like Meta and Stripe and, more recently, Credit Suisse and Deutsche Bank. In addition, Polygon fully supports the tether stablecoin, which could contribute to the network’s future growth. Another plus is its investment in carbon neutrality, which occasionally has prompted price rallies.
Risks of Investing In Polygon
Polygon’s layer-two solution is designed to overcome Ethereum’s speed issues. However, future Ethereum improvements could eventually result in faster transaction speeds than Polygon provides, eliminating Polygon’s primary advantage.
6. USD Stablecoin (USDC)
- Price: $1.00
- Market capitalization: $35.99 billion
- Year-over-year return: -0.02%
Stablecoins are cryptocurrencies that are pegged to fiat currencies such as the:
- U.S. dollar
- South Korean won
- International Monetary Fund’s Special Drawing Rights currencies
You can use stablecoins as:
- An alternative to making cash transactions
- A bridge between two coins that can’t be directly paired for trading
- A comparatively stable holding to diversify your cryptocurrency portfolio
Stablecoin developers maintain reserves to cover the value of their circulating coins. This helps keep the coin prices stable. However, the reserves don’t always consist strictly of the fiat currency to which the coins are pegged. Tether, for example, backs 100% of its circulating coins with reserves, but a small percentage of its reserves are:
- Bitcoins (4.00%)
- Secured loans (5.55%)
- “Other investments” (2.98%)
USD stablecoin is different because it’s fully backed by cash and short-term U.S. Treasury and Treasury repurchase agreements, which are considered cash-equivalent because they’re backed by the full faith and credit of the U.S. government.
Risks of Investing in USD Stablecoin
All stablecoins have some risk of depegging — losing their peg to the currency that backs them — Fidelity warned. The risk is smaller for coins backed by fiat currency, but it’s not nonexistent.
7. Avalanche (AVAX)
- Price: $28.10
- Market capitalization: $11.41 billion
- Year-over-year return: 212.22%
Avalanche is a relatively new “layer one” foundational blockchain that can execute smart contracts. It was founded as an Ethereum competitor by Ava Labs and computer scientists at Cornell University. One of them is former professor Emin Gün Sirer. He is a veteran in cryptographic research, according to CoinMarketCap.
Avalanche’s individual blockchains can validate transactions independently. This makes Avalanche scalable and able to handle large volumes of transactions — up to 6,500 per second. As a result, it’s increasingly popular among Ethereum projects, U.S. News reported.
AVAX began trading in 2020, in a 24-hour initial coin offering. Its price has fluctuated from a low of $8.70 to a high of $65.25 over the past year. As of Sept. 26, the coin trades for $28.10.
Risks of Investing in Avalanche
Sirer introduced the cryptocurrency via a white paper in 2018. Its launch took place in 2020. With such a short history, avalanche doesn’t have a track record for comparison. This makes it a riskier investment for potential buyers.
8. Chainlink (LINK)
- Price: $12.31
- Market capitalization: $7.72 billion
- Year-over-year return: 66.27%
Chainlink uses a decentralized oracle network to facilitate secure interactions between:
- Blockchains and external data feeds
- Events and payment methods
The developers hope these features will allow smart contracts to become the dominant form of digital payment, according to CoinMarketCap.
One thing working in Chainlink’s favor is a strategic partnership with Google. This partnership allows Google to use Chainlink’s protocol to connect users to its cloud services.
Chainlink is also the choice for the new inflation index from decentralized finance company Truflation. It’s built to serve as an alternative to the consumer price index. The CPI measures inflation using survey data. However, Truflation’s index uses 10 million data points from over 40 different sources to measure inflation more dynamically, accurately, objectively and transparently. While Truflation hasn’t overtaken the CPI, it is a frequently cited source of inflation data.
Chainlink Labs’ advisors include:
- Former Google CEO Eric Schmidt
- DocuSign founder Tom Gonser
- Former LinkedIn CEO Jeff Weiner
Risks of Investing In Chainlink
Despite its proven utility and support from major players, chainlink has experienced the same kind of volatility as other cryptocurrencies.
9. Solana (SOL)
- Price: $152.74
- Market capitalization: $71.61 billion
- Year-over-year return: 690.04%
Solana bills itself as a blockchain built for mass adoption, with use cases that include:
- Nonfungible tokens, or NFTs
- Payment processing
- GamingFinance
It’s one of several Ethereum killers — Ethereum-based networks that improve on Ethereum’s cost and efficiency. Its fast speed and comparatively low costs are the result of a proof-of-history consensus. This creates a clock that synchronizes computers on Solana’s network. That synchronization has the potential to process transactions as much as 10,000 times faster than systems like Bitcoin and Ethereum.
Solana partnered with Visa, making it one of the first blockchains to partner with a major financial institution to process payments. You can also use Solana with:
- Meta
- Stripe
- Shopify
Risks of Investing In Solana
Solana is prone to network outages, according to AMBCrypto. The most recent one occurred in February. It resulted in a 4% dip in solana prices. Although the coin rebounded quickly, growth depends on reliability, and giving developers any reason to doubt Solana’s could be detrimental.
10. Dogecoin (DOGE)
- Price: $0.115
- Market capitalization: $16.8 billion
- Year-over-year return: 89.25%
Dogecoin is a meme coin whose primary claim to fame is that Elon Musk likes it. That means its value is based on sentiment rather than utility. However, that sentiment is a powerful force. The community that has sprung up around dogecoin is what drives it, and at various times, that community has created major surges.
DOGE prices have ranged from a low of $0.05747 to a high of $0.2266 over the past year — a 294% difference. The coin reached an all-time high of $0.7376 in 2021.
Risks of Investing In Dogecoin
Dogecoin’s value is based purely on hype. Despite having paid off brilliantly for some, it’s a risky bet.
Advice
Don’t settle on any number of cryptocurrency investments without continuing to learn about the market. A new cryptocurrency network could easily climb the ranks and emerge as a leader above other platforms. As an investor, the smartest thing you can do is to stay abreast of market happenings.
Rating the Top Cryptocurrency Choices
Run a quick online search and you’ll find dozens of recommendations for how to invest in cryptocurrency. In choosing the best cryptocurrencies to invest in, GOBankingRates considered the following factors.
1. Longevity
How long has the cryptocurrency been around? New cryptocurrencies aren’t immediately ruled out, but having historical data for comparison helps you see how a cryptocurrency has performed up until now.
2. Track Record
If you see stability in prices, that’s a good sign. If you notice that the cryptocurrency is gaining traction and becoming more valuable with time, that’s even better.
Good To Know
Past performance is not indicative of future performance. At any time things can change, and an investment may perform better or worse than it has in the past.
3. Technology
How does the platform compare to others in terms of usability and security? The first thing you want to look for is the speed at which transactions occur. The network should be able to handle transaction traffic with ease.
You also want to make sure your investment is secure. Most cryptocurrencies use blockchain technology, making all transactions transparent and easy to track. Blockchain technology doesn’t necessarily make it harder for hackers to steal your cryptocurrency. It does make it easier to track your investment so it can be recovered instead of being lost following fraud.
4. Adoption Rate
How many people are investing in the cryptocurrency you’re considering? When you see a high level of adoption, that means the cryptocurrency has better liquidity. Trading, selling or spending will be easier in the future.
Final Take
There’s no question about it: Cryptocurrencies are here to stay. The question becomes: Where is the best place to invest your money in the market?
As you decide which cryptocurrency is the best investment for you, here are some other things to keep in mind:
- The speed at which transactions are completed
- The fees associated with transacting
- The ability to use your cryptocurrency for regular purchases and bank transfers
If you’re strictly looking to invest without transacting within the network, remember that cryptocurrency isn’t a get-rich-quick scheme. Instead, you should consider it a long-term investment.
GOBankingRates’ Crypto Guides
- What Is Cardano? (ADA)
- What Is Polkadot? (DOT)
- What Is Ripple? (XRP)
- What Is Stellar? (XLM)
- What Is Tether? (USDT)
Daria Uhlig contributed to the reporting for this article.
Data was collected on Sept. 23 through Sept. 26, 2024, and is subject to change.