Bitcoin may have been the first cryptocurrency to market, and the scarcity factor–due to the whole “bitcoin mining” approach–heightened its appeal and led its astronomical rise. While Bitcoin may get all the attention, there are many alternatives for investors who want to dip their toes in the cryptocurrency pool. Here are five digital currencies to try if you want to diversify your portfolio but can’t swing the cost of Bitcoin.
1. Bitcoin Cash
Bitcoin Cash operates like Bitcoin, but with larger blocks. The larger block sizes decrease transaction processing time, which is a known stumbling block of Bitcoin. Since Bitcoin Cash was started by Bitcoin miners, it has credibility among cryptocurrency fans. While it premiered in 2017, it has enjoyed a fast rise in value, thanks to its association with the king of cryptos.
If the words “backed by science” make you trust something, then this is the cryptocurrency you want. Cardano is a cryptocurrency platform that hopes to run financial applications used by governments, individuals, and everyone in between. Unlike other digital currency founders, the team behind Cardano is transparent (and highly credentialed), which can foster trust.
Built by scientists and engineers to harness the best aspects of each cryptocurrency, Cardano is poised to offer a lot–and is priced incredibly low. If you’re seeking to get in on the ground floor of the next Bitcoin, this is one to watch.
If the secrecy is the main part of Bitcoin’s appeal for you, then DASH may be your crypto of choice. Originally termed Darkcoin, Dash, which launched in 2014, offers even more secrecy than bitcoin. Transactions are untraceable. In 2017, Dash was up some 8,000 percent, a fact that speaks to the popularity of the principles behind this digital currency.
Ethereum is the silver to Bitcoin’s gold. What makes it unique (and a potentially strong investment) is its non-currency use of blockchain. Ethereum lets retailers track inventory in realtime. Smart contracts trigger purchase orders when conditions are met. These features make Ethereum useful for many applications, a factor some believe will propel it to new highs.
Etherium is widely seen as among the “safer” cryptocurrencies to invest in. If you’re just wading into these alternative investments, that fact may appeal.
While bitcoin’s founder is anonymous, Litecoin’s founder is well-known (and highly esteemed). Consider also that Litecoin is much faster than Bitcoin, and four times as available, and you’ve got multiple compelling reasons to consider an investment.
Litecoin has sought out many merchant partners, hoping that widespread acceptance will translate to widespread use and a high value. Over the last year, Litecoin has grown in transactions by 300 percent, with some 30,000 transactions per day.
It’s important to do your homework with any new investment, but especially with cryptocurrencies, which aren’t regulated. Review the risks and potential rewards, determine how much risk you feel comfortable with, and invest in a cryptocurrency that offers the potential for ample rewards with tolerable levels of risk.