Bitcoin was launched in 2009, but a person or group of individuals named Satoshi Nakamoto. This was the time after the global economic meltdown of 2008, and many people felt the need for a financial system that did not depend on Big Banks.
Bitcoin was launched with the promise that it would topple the currently prevalent, centralized global financial system in time. However, since it has a limited supply of coins and the source code can’t be changed, it’s also considered a hedge against inflation.
While Bitcoin stays the most significant cryptocurrency player by some distance, other cryptocurrencies are also gaining popularity among investors. Here is a list of five such cryptocurrencies which you should think about investing in if you are looking to diversify your cryptocurrency portfolio and track them; some alternatives to bitcoin
5 Best Investment Alternatives to Bitcoin with Immense Potential
- Ethereum: Ethereum is more than just a cryptocurrency. Ethereum is a blockchain platform that allows programmers to launch dApps and smart contracts on its blockchain. The native token of Ethereum is Ether or ETH. ETH can also be called a cryptocurrency because it is used to navigate the blockchain on Ethereum and to buy and sell assets on the Ethereum blockchain. Ethereum is becoming increasingly popular among decentralized app developers all across the globe because it is fraud-resistant and runs without any downtime, control, or interference from a third party. Because Ethereum encourages programmers to launch smart contracts and dApps on its blockchain, it is fast becoming a crypto universe with various applications such as Defi and metaverse games. Until now, Ethereum uses a Proof-Of-Work consensus which has been a target of environmentalists because it consumes too much energy.But Ethereum plans to upgrade to Proof-Of-Stake consensus in 2022, which will reduce the energy consumption by 99% and make the transactions on Ethereum much faster than they already are. When the Proof-Of-Stake consensus is finally up and running, the participants will be able to stake their Ether to the network. This will, in turn, make the Ethereum network more secure, and the staking participants will be rewarded with Ether. Investors and crypto enthusiasts are eagerly waiting for Ethereum 2.0, which is widely considered one of the most anticipated crypto developments of 2022. As of March 2022, ETH is trading at $2565, and its market cap is less than half that of Bitcoin. But ETH is still the second-largest cryptocurrency in the market, and if you are looking for alternatives to Bitcoin, you have to start with Ethereum.
- Litecoin: Litecoin or LTC was launched in 2011, and its creator is Charlie Lee, an MIT graduate who has also worked as an engineer at Google. Litecoin is made in the same cast as Bitcoin, and the two digital currencies use the Proof-Of-Work consensus mechanism to approve transactions on their respective blockchains. Litecoin is an open-source digital payments network that is decentralized in nature and isn’t controlled by any central authority.
What makes Litecoin different from Bitcoin is that Litecoin delivers a faster transaction rate to its users than Bitcoin. As of March 2022, a token of Litecoin was trading at $106. Its value has increased more than five times in the last year alone, and this is a good investment opportunity that can provide high returns in the future. As of now, Litecoin is the 21st most prominent cryptocurrency in the market, with a market cap of $7.4 billion.
- Cardano: Cardano or ADA is a blockchain platform much like Ethereum, and it has recently become famous with the name Ethereum Killer. This is because experts believe that Cardano can do everything Ethereum can but much better. Charles Hoskinson co-founds the Cardano project. If you are familiar with the name, it is because Hoskinson was also one of the five founding members of the Ethereum project. However, after disagreements with the direction in which Ethereum was heading, Hoskinson left Ethereum and co-founded Cardano.
Cardano is unique because it is created with a research-based approach, and calligraphy experts, mathematicians, and engineers have been a core part of the Cardano project. While Cardano is still early, it has already beaten Ethereum in its Proof-Of-Stake consensus mechanism. Cardano has big future plans, and it aspires to become the worlds leading financial operating system. While nobody knows if Cardano will be able to leapfrog Ethereum soon, it has had a great start. With its $26.9 billion market cap, Cardano is currently the eighth-largest cryptocurrency. One token of ADA is presently selling at $0.80, and because of this price, ADA certainly is an exciting token to invest in with massive growth potential.
- Polkadot: Polkadot is a blockchain platform that offers users interoperability among different blockchains. DOT is the native token of Polkadot. Polkadot works on a Proof-Of-Stake consensus model to validate its transactions. What makes Polkadot different from Ethereum is that within Polkadot, developers can create their own blockchains and use Polkadot’s security with the concept called shared security. With Ethereum, developers can create their blockchains, but they need to create their security measures because Ethereum does not provide shared security.
This means if you are a low-budget developer, then Polkadot becomes your ideal choice to create blockchains, or if you want to stay on Ethereum, you risk security attacks on your blockchain. Another made Polkadot of Ethereum’s co-founders, Gavin Wood. Polkadot, too, has massive upside potential, with its native token DOT currently trading at $17.59 as of March 2022. The total market cap of Polkadot is $17.4 billion.
- Bitcoin Cash: Bitcoin Cash, or BCH, is unique because it is one of the earliest hard forks of Bitcoin. As we all know, cryptocurrencies are decentralized. Voting occurs whenever there is a disagreement between the developers and miners, and the discussions and debates don’t lead to satisfactory results. And if the large chunk of the participant on both sides still cannot agree, then the digital currency is split. Bitcoin Cash was one of the first examples of this hard fork. BCH came into existence in 2017, and currently, a token of BCH is trading at $286.97 as of March 2022. The total market cap of Bitcoin Cash is $5.5 billion.
There are more than 18,000 cryptocurrencies in the market, and most of these tokens go unnoticed. But there still are a few which have become popular among investors and crypto enthusiasts, and these are just five of them which have the potential to be the next Bitcoin and provide you with diversity in your crypto portfolio.
Considering that the crypto market is highly volatile, everything that looks good right now can turn brittle the next moment. Hence, always invest after thorough research and never invest more than you have the appetite to lose.