The Top 5 Cryptocurrencies to Know About: 2020 Edition

Buy May 21, 2020

To us here at Invity, cryptocurrencies mean more than just Bitcoin: there's Ether (ETH), Litecoin (LTC), Ripple XRP, and so many more "altcoins". But with so many to choose from, it's fair to wonder "What is the best cryptocurrency to invest in right now?" and "What do you even mean by 'the top cryptocurrencies'"? Not to worry: we'll give you a rundown of the top cryptocurrency investments to consider as you take your first steps in the world of crypto or diversify your existing portfolio. Of course, Invity is here to just make you aware, not provide financial advice, so make sure to do your own research before putting your money behind any of these!

What do we mean by "top"?

Perhaps the main factor to think about when determining the top coins to invest in is what you want out of getting into crypto. You can think of virtual currencies as a store of value that adds diversity to a portfolio, an investment tool that could quickly rise in value, or a means of exchange that makes certain transactions easier...to name just some of the common use cases of cryptocurrencies. In most of these cases, there's good reason to go with coins with larger market capitalizations, or "market caps", which is determined by multiplying how many coins are circulating in the world by how much each coin is worth. By working backwards from this figure, you can get a rough idea of the number of users of a coin, how easy it is to use, and how in demand it is—all important considerations when spending, exchanging, or investing.

This chart shows the market capitalization of major cryptocurrencies as of 2018; Bitcoin is well in the lead
Percentages of the total crypto market cap for the top 10 coins (Data from CoinMarketCap)

But market cap is much more complicated than that, and there are other factors to consider too: how well a currency lives up to the core principles of cryptocurrencies, the unique features a specific currency offers, and a coin's potential, especially for growth. All these considerations mean that the "best" crypto coin for you depends a lot on the personal goals you want to achieve. Still, there's a lot of variety in these areas even among the bigger coins. So with all that said, let's talk Bitcoin—plus all the best altcoins to invest in.

The best cryptocurrency to invest in today: Bitcoin (BTC)

The logo of Bitcoin, the best coin to begin investing in today
Bitcoin logo (By Bitcoin forums via bitboy)

While there may be plenty of investments like Bitcoin, there's only one granddaddy of them all: the original Bitcoin. Like Coke, the original never went out of style. And why would it? The idea for this new type of money can be traced back to 1998 or even further, and the cryptocurrency we know today appeared in 2009, so it's had more time than any competitor to be adopted by users. The more users any currency has, the more useful and in-demand it is for trading between individuals and being used at businesses. It's also had the most time to be technologically perfected—Bitcoin is totally open-source, meaning both transparency and trust are higher than competing cryptos and even everyday monies. What's more, constant developments like the Lightning network are making it easier and more reliable to spend bitcoin, especially as micropayments. Even still, be aware of closely related derivatives like Bitcoin Cash (BCH) or Bitcoin SV (BSV) and make sure you're buying the real deal.

Crucially, Bitcoin's historic leadership position and typically high value (as of this writing, BTC 1 is worth over USD 8,500!) makes it a pretty good place to park some investment cash: similar to its less-technological ancestor, gold, Bitcoin it probably won't ever crash too low and may be quicker to recover during a crisis. Bitcoin is the evergreen "best choice" for users who want to start investing in crypto.

Litecoin (LTC)

The logo for Litecoin, the silver to Bitcoin's gold
Litecoin logo full colour (By Toni-Rose Withall and The Books Creative via the Litecoin Foundation)

If BTC is digital gold, then LTC is definitely digital silver. Bitcoin and Litecoin have a lot in common: they're technically very similar, they both aim to become a revolutionary new type of money, and they're the top two coins by market cap, respectively. But the real reason you should consider an LTC investment is because Litecoin explicitly aims to become a crypto for everyday usage. Litecoin completes its transactions far faster than Bitcoin—it only takes around 2.5 minutes to complete an LTC transaction compared to BTC's 10. Litecoin is also much more widespread—there will only ever be a maximum of 21 million bitcoins, while there can eventually be four times that number of Litecoins in circulation. These features all make LTC a cheaper and more practical solution to making everyday purchases using virtual currencies.

So despite their broad similarities, it's clear why both exist—and why it's worth investing in Litecoin and Bitcoin. After all, when it comes to traditional assets, you keep your gold and jewelry in a safe deposit box at the bank, while you keep your cash in your wallet for your morning coffee. Litecoin and Bitcoin are in a similar situation, and it's possible that the difference between one as a medium of exchange and the other as a store of value will only become more distinct with time. The solution? Get some of each!

Ripple XRP (XRP)

A coin representing the XRP currency issued by Ripple
Silver Ripple coin on white background (By Marco Verch, licensed under CC BY 2.0)

XRP, a cryptocurrency issued by a company called Ripple (which is also often used to refer to the tokens themselves), doesn't just come from a different family than the previous entries, it's almost an entirely different species. Of course there are some pretty significant technical differences (warning: jargon ahead!), but the main distinguishing feature is that XRP isn't intended to be a replacement for the money you use to pay for everyday goods and services. Instead, it's intended for banks and similar institutions who need to transfer high-value commodities—fiat currencies, gold, even oil—instantly and directly across the globe without high fees. In other words, XRP simply represents important assets and can be transferred far more easily between countries. Major banks like Santander, the Commonwealth Bank of Australia, and many Japanese banks already use XRP in place of bank transfers and other slow, costly mechanisms.

If you're reading this, you're probably not a bank—so why should you invest in Ripple? Mainly because it's perhaps the best cheap cryptocurrency to invest in. Ripple holds most of the XRP tokens and carefully releases them into circulation, but it's still released about 43.6 billion tokens into the world; as of this writing each one is only worth around USD 0.20. But with its high trading volumes and growing adoption by established financial institutions, XRP is the top penny cryptocurrency you should consider and one that may soon become an even more valuable part of the global economy. It may never be as highly valued as Bitcoin, but XRP has a bright future ahead of it.

Monero (XMR)

Monero is probably the most secure crypto on the market today; you can convert BTC to XMR through Invity's Exchange crypto feature
Monero Logo, white background (By Monero)

On its face, Monero is another altcoin that is broadly similar to the classic Bitcoin and its faster cousin Litecoin: all allow for seamless payments regardless of international borders, all are built on a backbone of difficult-to-decipher mathematics, and all generally keep data about you and your payments away from prying eyes as long as you use careful practices. But while Monero may not yet be in the top ten coins by market cap, it offers something unique by taking anonymity to the next level—perhaps even the highest level of anonymity on the market among widely accepted coins. We won't go into the minute details, but it's good to know that Monero uses a variety of extra technical layers to hide the identity of both the sender and receiver, as well as the amount of each transaction, meaning there's little to no chance of you or your funds being identified. It's also good to note that, unlike the other currencies on this list, you can't buy Monero directly using your credit or debit card; you'll have to exchange other cryptocurrencies for XMR using Invity's Exchange crypto feature.

You may read about the somewhat unsavory past of this highly private form of currency, and we're not here to dispute that (or to judge you if that's what you're looking for). However, in light of countless data breaches at banks and businesses in recent years, it's no surprise that privacy is beginning to be taken very seriously by mainstream users. This is helping Monero shake off its former reputation as it becomes seen as a potential solution to security and other social issues, such as raising bail for unjustly imprisoned people.

Ether (ETH)

Ethereum issues the Ether currency, which may be used for many exciting possibilities
Ethereum logo landscape black (By Ethereum.org)

Ether is the strangest but perhaps the most revolutionary of all the currencies on this list. Like XRP, Ether is the name of a cryptocurrency that runs on its own system, named Ethereum (though the two terms are often used interchangeably). But what sets Ethereum apart from any of the other cryptos discussed above is that it doesn't have a good financial equivalent in the world we know today. Instead, Ethereum is closer to political economy: it's an entire decision-making ecosystem in which tokens that hold value are just one part. While an entire article (or book!) could be written on Ethereum, the short version is that it's a system built specifically to carry out "smart contracts" and "decentralized applications" that, among other things, allow actions to be taken once an agreement has been reached between users.

So where does Ethereum investing come in? Ether is like a vote: you can put up a token to signal that you're in favor of one course of action, and you can put up more tokens if you feel more strongly about something; more tokens equals a "louder" voice. This has already been used widely in the world of finance, but uses like prediction markets, organization and company governance, and even voting in elections are popping up with astonishing speed. This means that Ether is just at the beginning of its very exciting life—it could be on the verge of a real explosion. And when it comes to whether, say, you should invest in Bitcoin or Ethereum, it's really apples to oranges—go with both!

There are plenty more worthwhile cryptocurrencies to invest in for their own specific reasons, and they all deserve a mention. But BTC, LTC, XRP, XMR, and ETH are the ones you might consider keeping your eye on when first getting into crypto: they're some of the most well established coins out there and they give you broad coverage most of the main uses of crypto. The best part is that you can get all of them through Invity's Buy crypto or Exchange crypto features—check them out today to take advantage of all the different coins out there!

Cover photo: Cryptocurrency coins on wood again by QuoteInspector.com is licensed under CCBY-ND 2.0

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