Let’s be honest, cryptocurrencies had a bit of a shocker in 2018! A bear market lumbered into town and helped itself to a big bite of everyone’s picnic, Yogi-style. That means it’s a bad time to invest right? Wrong!
Now is the perfect time to swoop in and grab yourself a bargain. Before you do though, there’s a few things you need to know first. Newbies often have difficulty deciding which cryptocurrency is the best one to invest in but fear not, I’m here to help.
By the time you finish reading this guide, you’ll have all the information you need to make the right choice. I’m no financial adviser (I’m really not!) but I do know a thing or two about one of the most exciting technological developments of the last twenty years. When it comes to crypto, if you focus on the tech, you can’t go wrong!
Let’s get started shall we? I want you to cast your mind back to 2008…
The Birth of Bitcoin
One of the greatest economic crises in modern history followed the collapse of the American housing market in 2008. To many, the collapse was due to corporate greed and incompetence, specifically on the part of the big banks.
A mysterious figure called Satoshi Nakamoto decided that enough was enough and designed a cash system which didn’t require any centralized middlemen like banks. His new decentralized digital cash system was called Bitcoin, the world’s first cryptocurrency!
To begin with, no one outside the crypto community really knew what to make of Bitcoin and its revolutionary use of blockchain technology. However, by 2010 people had started to recognise the potential of Nakamoto’s creation and it started to develop monetary value. By 2011, it had reach parity with the US dollar (USD) and other cryptocurrencies, like Litecoin began appearing.
The Rise of the Cryptocurrency Market
Between 2013 and 2017 the market for cryptocurrencies really blew up, with hundreds of new coins and tokens being created and traded for cash. Upstarts like Ripple, Bitcoin Cash, Ethereum and Dogecoin all became hugely popular and the market, as a whole, grew by more than 4000% in 2017 alone.
Bitcoin led the pack, then as it does now, reaching an eye-watering coin-value of 19,140 USD by 17 December. Trading cryptocurrencies had become a sector worth hundreds of billions of dollars, featuring thousands of coins and countless trading platforms like Coinbase, Binance, Bitfinex and Kraken.
Since those halcyon early days, the cryptocurrency market has cooled considerably and the 2018 bear market has deterred many investors. The overall market cap for cryptocurrencies halved in the latter part of last year and is yet to fully recover.
Note: Market cap (or capitalization) is the total value of all cryptocurrency currently in circulation.
At its peak in January 2018, the market was worth an astonishing 813 billion US dollars but has subsequently shrunk to around 120 billion USD today.
It’s near impossible to predict where this runaway train is heading next – in the last 24-hours (09/02/2019) the market has spiked by 10 billion USD – so you need quick wits and nerves of steel to become a successful trader. You’ll also need all the information you can get about the coins your trading with.
I can’t help you with your wits or your nerves but I can tell you about some of the best cryptocurrencies to invest in for 2019. So let’s do that!
What is the Best Cryptocurrency to Invest In: 2019
Best Cryptocurrency to Invest In: Bitcoin (BTC)
Bitcoin is still top dog, there’s just no denying it. It’s been the number one coin to invest in since 2009 when it single handedly invented the concept of cryptocurrency as we know it.
As you would imagine, Bitcoin dominates the market which wouldn’t exist without it. It’s market cap accounts for more than half the total value of all cryptocurrencies today (sitting at a sizable 63 billion USD when compared to an overall cap of 120 billion USD)
Cryptocurrency trading is deeply volatile with dramatic coin price fluctuations being the norm and Bitcoin is no different.
It can be argued that the best time to invest in Bitcoin was about six years ago when its coin value was still within the reach of the average retail investor (at around the 80 USD mark). Since then, the price has rocketed to roughly 20,000 USD (in Dec. 2017) only to fall back past 6,000 USD in Feb. 2018 and halve again late last year. At time of going to press, the price one Bitcoin is about 3,700 USD.
So, whilst it might seem that, as a speculative investment, Bitcoin has had its day many “Bitcoin maximalists” argue that it’s only just getting started. Cybersecurity whizz and known “eccentric” John McAfee believes that the price of Bitcoin will reach 1 million USD by 2020. But what if you’re wrong, J-Dog?
“I will eat my dick on national television.” – John McAfee
Oookay… sorry I asked…
It’s impossible to know exactly where the price of Bitcoin is going but if you keep an eye on a few key areas, you’ll have a better idea than most. Here’s a few examples;
- Technological Developments
Upgrades, sometimes referred to as hard or soft forks can affect the price Bitcoin. In 2017, Bitcoin split into two cryptocurrencies – Bitcoin and Bitcoin Cash – which allowed investors to claim equal amounts of both coins, effectively doubling their money! That said, uncertainty regarding developments can drive the price down as it did at the time of the SegWit debate.
This year, all eyes will be on regulators in Europe, the US and China with the decisions sure to affect the price of Bitcoin.
In Europe, the FCA and EBA have been trying to flesh out their approach to cryptocurrencies at a time when Brexit is making new legislation a lot trickier. When the dust settles in the wake of Britain’s exit from the EU (if it ever does!) however, new rulings could prove conducive to the flourishing of digital cash on the continent.
In the US, the SEC has been toying with the establishment of Bitcoin exchange-traded funds; financial instruments which could bring billions of dollars worth of institutional investment into the space. Could 2019 be the year for BTC ETFs?
China’s approach to cryptocurrency is under constant scrutiny as it’s thought that roughly 80% of the world’s Bitcoin is mined there. So far, the Chinese government has come down hard on traders but has been lenient in other areas (specifically ones it can directly control!). Totalitarian regimes can be a tad unpredictable, so we’ll to watch this space!
- World Events
Bitcoin isn’t just for superpowers, it’s for the whole world! In fact, it’s arguable that Bitcoin has greater value in developing nations than it does in first world countries.
In nations where conflict and economic instability are rife (eg. Somali, Sudan, Afghanistan), Bitcoin offers a safe and stable store of value without requiring any infrastructure or third-party trust.
Furthermore, Bitcoin allows countries who have fallen foul of the United States (I’m looking at you Iran, Venezuela and North Korea!) to allude the dominance of the USD as well as any economic sanctions related to it.
You’ll also want to keep an eye on the price of gold, if it tanks you can almost guarantee that the price of Bitcoin will rise. Many believe that Bitcoin is the logical successor to gold as a global store of value for the digital age.
That’s enough about Old Man Bitcoin for for now, let’s consider some other cryptocurrencies worth watching in 2019…
Best Cryptocurrency to Invest In: Ethereum (ETH)
Following the inception of Bitcoin, Vitalik Buterin’s Ethereum entered the market in 2015 as a second-generation blockchain platform. If Bitcoin had set out to decentralize banking, then Ethereum wanted to decentralize everything else.
The revolutionary tech Ethereum is based on allows developers to use the platform’s native coin (Ether) to build their own tokens and dApps (decentralized applications) which in turn could form the basis for a decentralized internet.
The value of Ether has never scaled the heights of BTC and it had an especially torrid time last year when a lot of the tokens built on Ethereum went bust. However, Ethereum has long had the blessing of the crypto community and could yet prove a dark horse as an investment.
The coin value of Ether dipped into double figures late last year but has since achieved a modest recovery and is presently worth around 120 USD, making it an appealing prospect for tech savvy investors eyeing long-term profits.
This year looks set to see innovation on the Ethereum blockchain in the form of the Constantinople hard fork as well as the continued creation of exciting new cryptocurrencies on its developmental framework (one of which gets a mention a little lower down our list!).
Best Cryptocurrency to Invest In: Ripple (XRP)
Founded in 2012, Ripple is often considered an institutional blockchain solution as it actively seeks collaboration with established financial services providers. Often viewed with suspicion and occasionally met with derision by “crypto purists”, Ripple is nonetheless well worth a look.
Getting into bed with the big boys and securing huge amounts of private funding has meant that Ripple is largely insulated against the worst excesses of market volatility. XRP has been a top 3 coin on CoinMarketCap for several years and regularly displaces the better-known Ethereum for the number 2 spot.
Ripple’s market cap is more than 12 billion USD and has a coin value of roughly 0.30 USD, making it a less daunting investment prospect for newbie traders. Buying XRP can be a great introduction to crypto trading as it won’t break the bank. Corporate backing means the coin is managed much more like a traditional business than most other cryptocurrencies.
If Bitcoin’s wearing flip-flops and a hoodie to the office, then Ripple’s definitely wearing a suit and tie!
As regulations begin to catch up with the technology and more institutional investors climb onboard, Ripple may prove itself to be a key innovator in crypto this year, and in the years to come.
Best Cryptocurrency to Invest In: Zcash (ZEC)
Zcash applies supercharged cryptography to provide its users with enhanced privacy, allowing private transactors the option of using “selective disclosure.” This feature lets users remain anonymous whilst complying with anti-money laundering and tax regulations.
Zcash has a strong development team who consistently make improvements to the coins protocol meaning it entered 2019 in better shape than ever. The most notable upgrade to be implemented on the Zcash blockchain is called zk-SNARKS, or zero-knowledge proof technology which allows users to trust each other with no interaction whatsoever.
Such technological breakthroughs have not only caught the attention of Wall Street but have also won the praise of crypto renegades. CIA-whistleblower, Edward Snowden, had this to say about the fast-rising privacy coin;
“Zcash for me is the most interesting right now, because the privacy properties of it are truly unique, but we see more and more projects that are trying to emulate this and I think this is a positive thing.”
ZEC is currently the 20th biggest cryptocurrency on the market, boasting capitalization of 314 million USD and a coin value of 53 USD. Having suffered like the rest of the market last year, it can be argued that Zcash is presently undervalued and may make a sound investment for traders looking for a coin which exhibits top tech as well as real-world application.
Best Cryptocurrency to Invest In: Binance Coin (BNB)
As the name suggests, Binance Coin is the official cryptocurrency of the world’s biggest coin exchange, Binance. Founded by Changpeng Zhao in 2017, Binance has quickly come to dominate global crypto trading and introduced its native token last year.
The genius of BNB is in its simplicity. Use BNB to pay your transaction fees and you get a discount. It can also be issued to users in the form of a reward or incentive, this gives the coin innate real-world utility and instant resale value.
No surprise then that since its launch, Binance Coin has shot up the coin league table and is presently the tenth biggest cryptocurrency in the world. It has a market cap of 1.2 billion USD and a coin price just shy of 9 USD.
Binance Coin is, in many respects, an archetype for how cryptocurrencies should be conceived of and executed. Whilst some coins seek to establish themselves as alternatives to fiat currencies, stores of value like gold or digital tethers for physical assets (stablecoins), BNB keeps its feet on the ground. It has a clear and present function, and is as such, one of the few cryptocurrencies that you can see in action now rather than at some theoretical point in the future.
As Binance continues to expand its operations in places as diverse as Malta, Jersey and Uganda, you can guarantee that BNB will be indispensable element in its ongoing success. It also means that as crypto investments go, Binance Coin is looking pretty inviting indeed.
Best Cryptocurrency to Invest In: Golem (GNT)
Utility remains the theme here, with Golem presenting an ingenious solution to a tangible problem.
Acting like a kind of crowdfunding for those seeking a cheaper source of computational power, Golem enables users and applications to rent out cycles of other users’ machines.
We all have computers which we (even the most dedicated nerds amongst us) don’t use all the time. Golem allows its users to share their idle computer power with others for a GNT fee on a completely decentralised Ethereum-based application.
The platform has already been successfully deployed for the rendering of studio-quality CGI effects and has myriad potential use cases across numerous disciplines (including gene mapping and machine learning).
Golem is currently the 62nd biggest cryptocurrency on the market, making it an outside bet in its capacity as an investment. However, with an expanding remit, a market cap of roughly 65 million and a negligible coin price, GNT is a near perfect speculative investment. So, if you’re feeling lucky this year, this power-sharing dApp might appeal to you.
So, there you have it. Tokenleak’s top tips for cryptocurrency investment in 2019. And now a word from our sponsor…
Whether you’re investing in cryptocurrencies, gold bullion or Chantilly lace, you need to remember two important lessons;
- Don’t spend more than you can afford to lose. No investment is as safe as houses … not even houses!
- Don’t mistake a guide to cryptocurrency investment (however well-informed) for financial advice, it’s not. That’s what financial advisors are for!
Whether you play it safe and back a proven thoroughbred like Bitcoin or take a punt on a newer innovation like Golem, be sure to remember that the thing that makes crypto trading so profitable is also the thing that makes it so risky. Volatility has come to epitomise the coin market and the only long-term winners are those who invest for the love of the tech and not for the Lambos. Pick a project you dig, research it, then, if you like what you see, offer a little support!
What coins do you think are moon-bound this year? Let me know, I love a good debate!